The Press SATURDAY, SEPTEMBER 14, 1948. Trade Bargains

Press, Volume LXXXII, Issue 24980, 14 September 1946, Page 6

The Press SATURDAY, SEPTEMBER 14, 1948. Trade Bargains

A message during the week reported an agreement between the British Board of Trade and the Soviet trade delegation, covering the unfulfilled part of war-time con. tracts for the delivery of British goods to Russia. The details are clearly incomplete, since 62,000 tons of timber, which the Soviet Exporting Organisation is to make available, cannot balance £40.000,000 worth of British machinery, etc. The details, however, are less important than the general significance of the agreement, which, according to Professor Marquand, of the Department of Overseas Trade, evidences the “ complete accord ” between the Russian and British trade representatives and dears the way for normal trade exchanges. A great deal depends, however, on the definition of “ normal ” trade, where Russia is concerned. '“Two or three months ago, the Russian trade delegation returned to London (with two shiploads of gold and platinum to back its arguments) to overcome difficulties that brought Anglo-Russian trade to a standstill a year ago. Russia had then ordered about £50,000,000 worth of machinery and equipment, £11,500,000 worth had been delivered, but the invoices had been re-i jected on the ground that the prices were too high, although the orders had been placed on an undertaking to accept the same prices as the Ministry of Supply was paying tor similar goods, (in addition, the manufacturers were able to. claim that the prices were actually below current market levels.) Negotiations broke down on the question of price and also qn the question of the shipping arrangement insisted on by Russia, which was that only British ships which delivered cargoes to Soviet ports should lift return cargoes of timber, the chief import from Russia. Timber being bulkier than machines of equiva. lent value, this meant that Russia could obtain delivery in full while Britain could obtain delivery only in part. In addition, the Russian trade delegation stipulated, all along, for prompt delivery, which British industry, still in the throes of reconstruction, is not well placed to promise. If full agreement has now been reached, however, it must cover all these points and probably does so in a way favourable to Britain; for there are plain indications that Russia is making strenuous efforts to speed the new five-year plan by importing. But if, as the nature of the negotiations strongly suggests, the agreement is in effect a bilateral barter agreement and an agreement between the British Government and the Russian foreign trading monopoly, it will not be surprising if WaaWngtpn asks questions and offers some sort of protest. American objections to the conduct of international trade by State monopolies are deep, though it seems obvious that, if Russia is .to be drawn into multi-’ lateral trade agreements, the objection will have to be sunk. Washington dislikes, again, any sort of present agreement bilaterally cast, and therefore likely to stand in the way of free, multilateral tradiqg agreements; and recent notes to Sweden and Russia voiced this objection to the announced trading agreement between them. The international discussions on the future conduct of world trade are near; and it is, of course, undesirable to Impair their chance of success. But the ambiguity of American polieydoes not promote it. There is a Strange inconsistency between, for example, the remonstrance to Sweden and Russia and the actual conduct 1 of American policy. The recent American trade arrangement between the liberated and independent Philippines and the United States is essentially a bilateral and discriminatory trade agreement. Every loan given by the IpiporiExport Bank is given op the terms of a bilateral and discriminatory trade agreement; and the British loan, as a loan from Government to Government, is the only exception to the current rule that all American loans to foreign governments are made through this bank and are therefore “tied-” While American policy has this ambiguity, warnings against bilateralism are not so wholesome as they might be.