BRITISH TRADE PLAN

Press, Volume LXXXIX, Issue 26967, 17 February 1953, Page 9

BRITISH TRADE PLAN

Butler Seeks E.P.U. Mandate

(Special Correspondent N.Z.P.A.)

(Rec. 9 p.m.) LONDON, February 16. It is understood in London that when the Chancellor of the Exchequer (Mr R. A. Butler) opens the financial discussions in Washington, he hopes to be regarded as a spokesman, not only for the Commonwealth, but for the whole sterling area, embracing France and the European Payments Union countries. The reason for this is reported to be that he is taking with him proposals tentatively discussed at the Commonwealth economic conference for what amounts to a new world banking plan with the object of ending the dollar-sterling problem. For its proper working, the plan would need the allegianee of all the Commonwealth countries, the E.P.U. and the United States. The basis of the plan will be the provision, by the United States, of very large dollar sums to underwrite the freeing of world trade in conjunction with all countries which reciprocally lower tariff barriers) and remove all other restrictions.

This scheme was said to have been discussed by Mr Butler and Mr Eden with the American Secretary of State (Mr John Foster Dulles) when he visited London. One of the first aims would be to harden the value of sterling by easing customs regulations and cutting import quotas. Eventually, free world trade is proposed with sterling becoming freely interchangeable for any foreign currency, including dollars. This would reopen Commonwealth markets to United States goods by removing trade barriers, wipe out the basic trade unbalance between the dollar and sterling areas, and thereby end the need for more American aid in the future. This plan is at present being discussed in London with the French Prime Minister (Mr Rene Mayer), the Foreign Minister (Mr Georges Bidault), and the Minister of Economic Affairs (Mr J. Buron). Mr Butler is reported to be seeking French* support for the proposals. This aspect of the

talks would indirectly affect New Zealand, as the French have said they intend raising several matters concerning Commonwealth trade, including Imperial preference. Reports from Paris suggest the French would be ready to co-operate as long as the E.P.U. did not suffer through any lowering of tariffs, easing of customs regulations, or cutting of import quotas that the United States might grant to Commonwealth countries. In return, the French are seeking freer trade, not only with Britain, but with all other, Commonwealth countries. It is understood that one of Mr Butler’s difficulties is to meet the French request for an increase in British imports from France, because in recent years French inflation sent prices so high that British buyers have scarcely used the limited quotas allowed for French imports. Similarly, the French want New Zealand and other Commonwealth countries to «take more French goods.