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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

United Kingdom ,   pp. 1-135 PDF (51.1 MB)

Page 67

sized that it was the pending Australian elections which were the main
source of delay; that at that time no mention had been made of
American-Canadian negotiations which, even now, were not techni-
cally in the stage of negotiations but were explorations to ascertain
whether it would be possible to conclude a supplementary American-
Canadian trade agreement on a fifty-fifty basis.
  Secretary Hull particularly stressed that the United States had
no intention of paying two for one in the matter of an Anglo-Ameri-
can agreement; that whereas, in order to alleviate certain political
difficulties which it had been represented that Mr. Mackenzie King
was facing, the American Government was willing to conclude an
American-Canadian supplementary agreement, it could not give com-
pensation in that agreement for any releases which Canada made to
the United Kingdom in order that the United Kingdom should be in a
position to negotiate in turn with the United States; that "the coun-
tries which made the Ottawa Agreements must themselves be respon-
sible for the relaxing of their provisions."
  F or his part, Mr. Mallet stressed the desirability of obtaining the
non-Ottawa list, which, he said, would require study beyond the ter-
mination of the Australian elections on October 23rd, and he particu-
larly emphasized that his Government was most desirous of doing what
it could to accelerate the process of negotiations. Sir Frederick Phil-
lips likewise expressed this view, and it was agreed that Mr. Mallet and
the Acting Commercial Counselor should see Mr. Sayre the next day
and discuss the matter with him in detail.
  Incidentally, in the course of Secretary Hull's exposition of the aims
and purposes of the American trade agreements- program, the Secre-
tary of the Treasury stated that he "stood shoulder to shoulder"
Mr. Hull in this matter.
  In response to a query, Sir Frederick Phillips summarized his view
of the position of world trade briefly as follows:
  World trade by any standard of measurement was now found to be
increasing, but the rate of increase was far- too moderate and slow.
Due largely to the rise in the prices of primary products, the producers
of these raw materials had acquired a purchasing power which was
being reflected in the demand for finished goods and, in the absence of
a decline in prices, this process of mutual beneficial trade should
continue and increase. Sir Frederick Phillips saw as the main diffi-
culty in the way of world trade the exchange and quota systems which
had been erected in the first place, not as a means of regulating trade
per se, but in order to protect the currency position of particular coun-
tries. While he did not expect any abrupt relaxation in these controls,
he hoped that, with the return of the world markets from being a
buyer's to a seller's market, these countries would gradually, despite

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