SOME CURIOUS EFFECTS IN OVERSEAS COMMERCE

Press, Volume LXXXIX, Issue 27011, 10 April 1953, Page 8

SOME CURIOUS EFFECTS IN OVERSEAS COMMERCE

U.S. TRADE EMBARGO

tßv the Staff Correspondent in Wasl-ngton of the “Sydney Morning Herald"] (Reprinted by Arrangement]

When the Foreign Secretary, Mr Eden, and the Chancellor of the Exchequer, Mr Butler, undertook during their recent conferences here to tighten Great Britain’s embargo against the shipment of strategic goods to Communist China, they were given a remarkable picture of America’s strenuous efforts to keep the iron and bamboo curtain countries from obtaining materials of value to their economies. . America’s embargo against the communist nations of Europe and Asia plays acutely on psychological angles. For instance, there is a category oi products which are identified as incentive goods,” and so far as it. is; in America’s power these are mteraicted. “Incentive goods” are those things which ostensibly will make the labourer in Communist countries work harder. , . Take the case of China. The Communist regime in China nas found that neither indoctrination nor even the threat o 5 a bullet m the back of the head will make the coolie work harder at building roads, or m a factory if the wages he gets cannot buy for him the things that pleas*his vanity or feed his ego as well as filling his belly. The Human Factor Mao Tse-tung has discovered that human nature can be modified only so far, and no further, by Marxist doctrine, no matter how much it may be backed up by compulsion. Not one in 10,000 Chinese can write or tell the time by a watch. But the possession of a loumain pen or a wrist watch is an matter of social distinction. And Ginseng, a “perennial araliaceous herb, which is grown commercially m America, is highly valued by the Chinese because of their belief (erroneous according to medical science) that it heightens virility. It is therefore the aim and purpose of the United States Department of Commerce to see that fountain pens, wrist watches, Ginseng, ana other “incentive” goods do not get to Communist China. No wonder that the traders of Hong Kong are up in arms against restriction of American exports of such commodities to the Crown colony! . For the most part America will allow the export to Hong Kong of strategic materials—and this includes incentive goods—only to the extent that they are for the. use of the Crown colony and definitely not. for re-export to the Communist mainland. To achieve quantitative restrictions statistics oi Hong Kong’s own “normal, pre-Korean requirements” are used. America herself, however, is dependent in certain instances on trade with China. Take pig bristles—an apparently insignificant item. insignificant to American house painters who find themselves seriously inconvenienced by the shortage and high price oi Chinese pig bristle brushes in the United States. British Exports While good Chinese pig. bristle brushes are also expensive m Great Britain, they are in much more plentiful supply and still only about halt as expensive as they are in the United States. . . There is therefore a modest but steady purchase of English-made paint brushes in the United States, despite a 25 per cent. duty. Rubber tyres and the necessary materials for the manufacture Of tyres are important items in the United States embargo on exports to China. Here is where India enters the picture. *

The Indian Government is scrupulously adhering to its commitments that ■ tyres and carbon black —the most i®. portant constituent in the manufacture I of this- item after rubber itself—inj. I ported from the United States are not for re-export to China, and American i exports of these commodities to India are statistically in conformity with India’s domestic needs. However, the Indian Government U hardly able to stop a very profitable trade in tyres with Communist China ■ Chinese buyers haunt the bazaars in obscure Indian border hamlets, pay fantastic prices for tyres, and haul them away in the night. If all this sounds fantastic, i n actuality it is even more fantastic than it sounds. Take the matter of blood plasma. In America there are professional blood donors who live on the blood they sell to commercial dealers in plasma. These, in turn, have a profitable foreign market for their goods. In Latin America, for example, it fc fashionable to take a “shot” of blood plasma when one feels seedy, just as in other countries one takes vitamin pills. But the Department of Commerce has to be careful how it allows the export of blood plasma. To begin with, there is always the possibility that this, like bootlegged penicillin, may ultimately get behind the iron and bamboo curtains.

In any event, plasma is allegedly in constant short supply in Korea for United Nations troops. Thus the policing of the market m blood plasma 1 is a real problem. The United States Government*! embargo efforts are not without their mildly humorous side. A recent incident illustrates this aspect of the cold war. „ ' 7 When an American firm applied to the International Trade Division of the Department of Commerce for a licence to export nylon to Poland, a slight shudder passed through the 3500 alert men and women of that division. Nylon is definitely a “strategic” material with many uses in war. When the lower echelon of the division processed the licence application, however, it discovered that it involved only a few dollars’ worth of the material and it was to be consigned to an order of Polish nuns who wished to use it for stiffening their white linen caps. It seems certain that the nuns will get their nylon. The ramifications of the American embargo against the Communist countries are bewilderingly complex—and they work both ways, as well as cutting . across the interests cf America’s allies. , Licences Needed There are few things one can now export from America without an export licence. . , A „ For instance, if you wish to fly a bouquet ot flowers to a friend abroad, you must have a permit, such is the vigilance of the International Trade Division of the Department of ComThe most innocent commodity in the most modest supply may have a profound importance in sustaining the economy of nations which are either making war on the United States or increasing their potential to do so. Thus, from industrial diamonds to common herbs, everything has a meaning in the cold war. Nor is the United States averse to purchasing Chinese pig bristles in foreign markets, provided the seller doesn’t make a point of the fact that they are a recent import from Communist China. ______