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United States Department of State / Foreign relations of the United States diplomatic papers, 1937. The British Commonwealth, Europe, Near East and Africa

Australia,   pp. 136-159 PDF (9.0 MB)

Page 146

negotiation of a trade agreement with this country. The United King-
dom found that they were hampered in the negotiation of such a trade
agreement by preferences on certain commodities, upon which we
would want reductions in their existing agreements with the Do-
minions. A disposition had become apparent at the Imperial Con-
ference to reconsider the preference agreements with a view to allow-
ing the United Kingdom more latitude in consideration of its trade
agreement with the United States.
  At this juncture Mr. Casey explained that the present Government
in Australia headed by Mr. Lyons was coming to the end of its Parlia-
mentary term and that an election must be held between now and the
first of December next. He said that, in his opinion, the election would
be some time before December and probably very soon. He said, of
course, the Lyons Government facing an electoral campaign was not
able to commit itself to any specific arrangements with regard to its
trade agreement with Great Britain as there was a strong feeling in
Australia that the existing trade agreement had conserved to Australia
a considerable and secure market for its principal exportable prod-
ucts and in an electoral campaign the present Australian Govern-
ment felt that it would not be politic to create an uncertainty in the
minds of a large portion of the Australian voters with regard to its
future trade position.
  Mr. Casey then brought up the possibilities of discussions with this
Government for a trade agreement between Australia and the United
States. He said that if the Australian Government could be sure of
supplying through trade with the United States any loss it might
incur by reason of a readjustment of its preference position in Great
Britain, it would make easier a consideration of a re-adjustment of
its present trade agreement with Great Britain. He said, at this point,
that he felt it would be possible to make certain readjustments in the
Australian-United Kingdom preference agreement,'9 but that, of
course, the Australian Government would want to know what ar-
rangements might possibly be made with the United States in the
way of trade concessions in order to know how far they could go in
any re-adjustment with Great Britain.
  Mr. Welles then stated that as far as discussions of trade agreements
between Australia and the United States were concerned, it would not
be possible for us to consider the matter while the Australian Govern-
ment was pursuing its policy of discrimination against American
trade. He explained that this was a matter of principle with us as
we did not in our negotiations of reciprocal trade agreements act on
the basis of negotiating the removal of discriminations. It was neces-
1' British and Foreign State Papers, vol. cxxxv, p. 183.

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