ANGLO-AMERICAN TRADE

Dominion, Volume 31, Issue 70, 16 December 1937, Page 20

ANGLO-AMERICAN TRADE

Efforts At An Agreement MR. L. S. AMERY’S VIEW In view of the negotiations being conducted for a trade agreement between Great Britain and the United States of America, the following letter in the “Manchester Guardian,” written by the Rt. Hon. L. S. Amery, and the editor’s comment, is of interest. Mr. Amery’s letter followed an editorial article in that paper.

“I have read with great interest the leading article, in which you indicate some of the difficulties inherent In any attempt to arrive at an Anglo-Ameri-can trade agreement,” he says. “You note that on the industrial side the American tariff is about twice as high as ours, and make it clear that, what with ‘the susceptibilities’ of her highlyprotected manufacturers and the complication resulting from the mostfavoured nation clause, the concessions on that side which are likely to be of much value to us are strictly limited. In return for them we are to make concessions at the expense of the Ottawa agreements and of our own farmers. “The simple question I should like to put is: What reason is there to suppose that the concessions which we might secure will be of greater value than those which we now enjoy through the Ottawa agreements, and which we shall obviously endanger if we go back upon those agreements? You point out yourself that ‘lndia, Australia and ocassionally Canada’ buy more British goods that the United States. You might have added South Africa and the colonial Empire, which are even better markets than the three Empire countries already mentioned. Even if they took no steps to reduce their preferences, the reduction of our purchases from them (far more important to their

economic structure than our purchases are to the United States) would inevitably affect their purchases from us. “But the United States is to be helped, not only at the expense of Dominion producers, but also at that of our own farmers, who provide our industries with a market even more important than that of any Dominion. The proposal, then, is that we are to endanger our position in our six or seven best markets in the uncertain hope of concessions in a next-best market. I confess that does not seem to me good enough.

There is, of course, room for a trade agreement with the United States if it were willing to reduce its industrial duties to something nearer our level, and at the same time to match any concessions in the sphere of primary production by equivalent concessions to British and Empire agriculture. But is there any prospect of that at present? If not, shall we not be much wiser to carry on consistently with that policy of mutual economic concession and co-operation which we inaugurated at Ottawa? The old fable of the dog, the bone and the shadow is still worth keeping in mind.” In a footnote to the letter the editor states:

By all means let us continue a policy of mutual economic concession and cooperation within the Empire, but we cannot believe it to be inconsistent with economic concession and co-operation outside the Empire. We should have thought it unlikely that a revision of the Ottawa agreements which benefited American products would necessarily be disastrous to the Dominions’ market here, or to provoke them to penal treatment of our exports. Expedients that commended themselves in a year of universal depression like 1932 can hardly be regarded as the last word in wisdom in a period of expanding trade, when the almost universal desire is to reduce barriers to commerce. We fail to see why concessions in an agreement with the United States should be “uncertain”; if they were we presumably should not sign it. Many British manufacturers, however, have an acute memory of concessions that were “uncertain” —those that were supposed to follow from the “reasonable competition” clause of the Ottawa agreements. We should agree that mutual concessions between the United States and the Dominions would be the proper complement of an AnglaAmerican agreement, but have no evidence to show that these are impossible of negotiation.