ANGLO-AMERICAN TRADE

Manawatu Standard, Volume LVIII, Issue 302, 19 November 1938, Page 9

ANGLO-AMERICAN TRADE

SIGNIFICANCE OF TREATY CONCESSIONS ON BOTH SIDES

(United Press Association.—By Electric Telegraph.—Copyright.)

WASHINGTON, Nov. 18

The Anglo-American Trade Agreement, which was signed , yesterday at the White House by the representatives of both countries, involves concessionson 675,000,000 dollars’ worth of commodities. The United Kingdom makes concessions on American imports valued at 300,000,000 dollars on the basis of 1938 trade, of which 200,000,000 dollars are in respect of apples and farm products.

The chief British concessions are on American wheat, lard, canned grapefruit, and fruit juices, on which the duties are eliminated. The duties on rice, apples, and pears are reduced. The number of hams entering under the British quota system is increased. The United States has granted concessions on British imports valued at 141,600,000 dollars on the basis of 1937 trade. The duties actually are reduced on imports worth 59,900,000 dollars in that year. * The United States binds itself not to increase the duties on 39,000,000 dollars’ worth of British imports, and has guaranteed that an additional 42,600,000 dollars’ worth of commodities will remain oil the free list. The concessions made by the United States principally involve duties on United Kingdom textiles, metals, metal manufactured goods, and various specialties. NO SURPRISES. Bearing out the earlier belife that it would contain no radical trade departures, the Anglo-American Treaty, with the exception of the free listing of wheat, does not reveal any surprises. It discloses itself principally as , an instrument for regularising the interchange of products of the two nations, encouraging, as far as possible, the free Alow of goods, and setting an example to the world of how the principal traders of it can conduct themselves amicably. It is seen that the United States has apparently given Britain assurances that in the time of war restrictions arising from America’s controversial neutrality legislation will not be allowed to handicap Britain. This evidence of Anglo-American solidarity will probably be carefully noted by foreign chancelries, but it was long mooted during the negotiations, and seems to grow naturally from the problems involved. Another interesting aspect of a broader nature of the treaty is the socalled “escape clause’’ relative to currency values which precludes a possible war in depreciated currencies in order to obtain selling advantages in each other's market. The treaty provides for a modification in the event of substantial variations in the rate of exchange between the two currencies, or termination of the agreement in its entirety within 30 days, after notice. It is felt that this provision will ensure close co-operation and equalisation of funds in England and America to maintain a reasonably stable parity between sterling and the dollar.

Linoleum duties are reduced 25 per cent., and duties on woollen fabrics, chiefly men’s suitings, are reduced 10 to 25 per cent. On w oollen hosiery the duty is reduced 15 to 25 per cent., and that on voolknit outerwear is reduced 10 per cent. Other reductions are on books, pamphlets, and music, the printed matter rate being halved to 7 per cent. The cowhide soles ad valorem rate is reduced from 12| to 10 per cent. Bound' on the free list are raw materials like rubber, tin, tea, cocoabeans, unmanufactured sisal, copra, essential and distilled oils, and various spices. Imports from the United Kingdom and colonies of these products in 1937 were valued at more than 350 million dollars. SCOPE OF AGREEMENT. AUSTRALIA NEED NOT FEAR. WASHINGTON, Nov. 17. An analysis of the types of concessions which Britain has granted to the United States indicates that, with the exception of wheat, which is given free entry and for which it is understood Britain has arranged adequate recompenses to Australia, there is little that Australia need fear. The concessions granted to the United States, such as dried fruits, leave the vital raisin field unaffected, for instance, and, while dried nectarines, apples, etc., from the United States are given concessions, they are not. necessarily vital. Canned fruits from the United States are given concessions, but chiefly the varieties not produced in Australia, such as canned grapefruit and loganberries. The concessions relating to fresh apples, while important, are designed not to interfere with Australian apple exports since the cuts in" duties will affect certain months when Australia is not shipping apples. The provisions relating to meat products are of various nature. While giving the Ul ited States greater opportunity for export, by reason of increased quotas, they nevertheless seem amply to protect Australia and New Zealand as far as can be seen from an early examination of the voluminous schedules since the increased quotas affect stuffs such as lard, etc., in which Australia and New Zealand are non-competitive. A matter of great importance to Australia is seen in the important concessions granted to Britain in manufactured woollen goods of the finest qualities. This is expected to produce a marked increase in the basic consumption of Australian fine Merino.

DETAILS OF CONCESSIONS,

REDUCTION IN DUTIES

WASHINGTON, Nov. 17. Details of the Anglo-American Treatv are as follow : In respect of tobacco the United Kingdom guarantees that the present Empire preference on unmanufactured tobacco of approximately 50 cents a pound will not be increased during the life of the agreement. It also undertakes to re-examine the question in 1942 with a view to reducing the preference. Cotton, which has long been on the free list, remains duty free. The United Kingdom has reduced the duties on apples by one-third. The United Kingdom absorbs 40 per cent, of American apple exports. The concessions on American commodities include grains, the present duty of 6 cents a bushel being removed. Previously this duty tended to divert British wheat which was purchased to Canada and Australia. Corn is now duty-free and is guaranteed against the imposition of duties. The duty on rice is slashed from about 2 cents to 1 1-3 cents a lb., a vision which is expected to regain American markets which were lost when rice was given free entry to Empire countries in 1932. FREE ENTRY FOR PORK.

THE PACT WITH CANADA. PRINCIPAL CONCESSIONS LISTED WASHINGTON, Nov. 17. The Canadian-American Treaty grants more favourable concessions to exports of American farm and industrial products than the original pact which expires on December 31 next. The agreement covers American exports valued at 80,000,000 dollars annually on the basis of 1937 commerce. The United States has granted Canada, its best foreign customer, additional benefits on the basis of imports totalling 73,000,000 dollars in 1937.

The principal concessions on United States commodities are as follow : Raw cotton, bound, on the free list, 0 per cent, excise tax removed. Lemons ditto; dried and canned fruits and vegetables, duties cut 15 to 50 per cent; eggs, reduced from 5 to 10 cents a dozenj grain and corn, reduced 10 per cent. Barley and oats are also reduced. Pulp, paper 1 and printed matter, 3 per cent, excise duty removed, with duty reductions in some cases.

The 10 per cent, duty on lard is removed, and continued free entry is guaranteed for chilled or frozen pork. The American quota of hams, whicli are already on the free list, is guaranteed not to fall below a minimum of 56,000,0001 b. against a quota ranging from 47,000,0001 b. to 49,000,0001 b. m 1935-37. Provision is ma de for a possible increase above a 56, 000,0001 b. minimum after the first year of t e treaty's operation. The duties on pears are reduced by one-third during the period from August to January, when the bulk or the American shipments is made. Those on canned fruits, pears, peaches and apricots the United Kingdom promises not to increase. The duty on grapefruit, at present 15 per cent., is abolished. The duty on pineapples is reduced by 2 per cent. , The duties on asparagus, corn, anci ovsters are reduced by 50 per cen The duty on chilled and frozen salmon is reduced by 50 per cent. Canned sa mon is guaranteed against increas . The duty on office machinery and new standard tyi>cwriters is reduced by M per cent. , „ Other reductions are: Accounting and calculating machines and casi registers, 25 per cent.; dictating n < chines, 50 per cent.; electrical machinery and applicances, including retrg erators, and vacuum cleaners, P cent.; tools, 20 per cent.; "'omens shoes and handbags, 20 per cent-, patent leather shoes, o 0 per c • > silk and hosiery, 25 per cenC UNITED STATES CONCESSIONS. The United States has made concessions or undertaken not to increase the rates on 621 British commodities, including whisky, gin and rum. The United States has promised to increase the duties on • , -g factures. The duties on 40 elassinc. Sn” are reduced ton, one-Mth of one per cent, .to seven p '''reductions on cotton doth range from 20 to 48 per cent. Ori flax ami jute and manufactures thereof the reductions range from per cent.

Metals.—The duty on iron and steel has been reduced from 450 to 400 cents a ton. Machinery has been granted new concessions, but that does not include, however, automobiles and aircraft.

Agricultural implements, 7J- per cent, bound, 3 per cent., excise duty removed. Radio, reduced 30 to 25 per cent.; timber reduced 20 to 10 per cent.; cotton fabrics, base bound against increase. Boots, shoes and rubber tyres are slashed from 35 to 30 per cent. Major concessions made to Canada include Grains ; The duty on barley is lowered from 20 to 15 per cent.; rve from 15 cents a bushel to 12; oats, from 16 to 8 cents a bushel. The timber duty of two dollars a 1000 feet on most timber is continued, fir and hemlock being added. Newsprint and paper-making materials are continued on the free list. Nickel, aluminium, and zinc duties arc reduced from one-fourth or less Other reductions refer to perishable foods, furs and fresh meats.

LOWER LIVING COSTS.

BENEFITS TO CANADIANS

OTTAWA, Nov. 18,

It is considered that the Canadian public will benefit from the new agreement in a lowered cost of living and cattlemen, fishermen and timbermen from an extension of their markets. The sacrifice of the whole British preference on Canadian wheat and one-third of the preference on apples and pears will not, it is contended, prove damaging. Wheatgrowers have been assured a fixed price of 80 cents a bushel by the Government and anplegrowers retain a substantial, if reduced, margin. What t.mbergrowers lose in the British market they will regain in the American. The treaty will probably prove most popular with Canadian manufacturers of iron, steel and textile products.

SIGNING CEREMONY. PRESIDENT’S SPEECH. (United Press Association —By Electric Telegraph.—Copyright.) WASHINGTON. Nov. 17. The East Room of the White House, where the treaties were signed, comfortably held the 250 spectators, who were composed half of journalists, the remainder being the negotiators and their families, including some youngsters. The treaties were signed in a brief and highly informal ceremony, which, however, did not lack genuine dignity and impressiveness President Roosevelt spoke first, impromptu. He merely emphasised that from the beginning of the first Can-adian-American Treaty there grew the greater and more beneficial AngloAmerican Treaty. The President then tried to hand the four copies of the treaties to Sir Ronald Lindsay, who stood on his right, for signature, when an officer of the State Department mildly reproved him, saying: “I had planned, Mr President, to have the Secretary of State sign first, and so arranged the documents.” The President smiled, and thereupon the signatures were affixed in the order of Mr Cordell Hull, Sir Ronald Lindsay and Mr Mackenzie King. HISTORIC PHOTOGRAPH. Mr Hull, Sir Ronald Lindsay and Mr Mackenzie King then made brief speeches, after which Mr Roosevelt voiced his thanks to the large number of technicians of all countries, whom he called “patriotic citizens,” for the untiring work they had done to achieve a difficult end, and concluded : “New, the nlstory of this signing will not be complete until the photographers have made a. record.” Fifty photographers took hundreds of snapshots, the glare. of the flashlights pricking the eyeballs of all present, hut apparently it was least disconcerting to the principals. The ceremony was then over, and the gathering dispersed. The journalists adjourned to the State Department to hear an exposition of the treaties from the experts who were responsible for the technical features. Observers declare that Mr Mackenzie King’s speech after the signing of the treaties seemed to be the most forceful, although Mr Hull’s was probably the most emphatic as to the meaning of the treaties for world peace. TALKS WITeTaUSIRALIA. TIME NOT RIPE YET. WASHINGTON, Nov. 17. One of the highest officials of the State Department, after the signing of the treaties, informed the Australian Associated Press that the present determination of the American Government was not to fix a date for beginning negotiations with Australia. “We have learned the unwisdom of trying to set a date for such a thing,” the official said. “I can assure you, however, that the will is there and the intention exists. I do not believe anybody can say when the right time for it will come.”

By other sources representing the American point of view it is readily admitted that the greatest concession which the United States lias as a trading point with Australia is wool. All other concessions, such as fruits and possibly meats, are impossible for a variety of reasons. Overpowering opposition would be raised by such fruitproducing States as California and Florida, andfrozen Australian meats would really be unable to compete against chilled imports. It is generally admitted that the State Department feels clearly that a reduction in wmols would give the American consumer one of the most important gains possible from any reciprocal trade treaty, but whereas some wool concessions might have been possible two years ago, they are impossible between now and 1940 purely for political reasons. It is conceivable that if Australia was ready to assure a wide open market for United Stat°s automobiles, cinema, and other important manufactured goods, the United States might be ready to negotiate a treaty, but such an instrument would have to be so overwhelmingly in America’s favour that it would be unacceptable to Australia. The Associated Press is informed from a reliable source that the placing of wheat on the free list as a concession to the United States was broached by the British Government to Sir Earle Page (Australian Minister of Commerce) during the latter’s visit to London and was by him accepted in return for definite recompenses to Australia by Britain, the exact nature of which is not known here.

LOSS TO EXPORTERS.

AUSTRALIAN WHEATGROWERS

SYDNEY, Nov. 18. Wheat exporters declare that the removal of the preference on Australian wheat will cost local growers £l,250,000 this year. Thus the Australian grower will be compelled to lean still more heavily on the Government. America, on the other hand, would become a hot competitor because of her surplus of subsidised wheat.

SIR EARLE PAGE’S LIST.

CANBERRA, Nov. 18

The Minister of Commerce (Sir Earle Page) told the House of Representatives to-day that the Australian commodities chiefly affected by the AngloAmerican Trade Agreement were fresh apples, pears, canned pineapple, and wheat. Sir Earle emphasised that the changes were concurred in after the fullest consideration by the Governments of Britain and the Dominions. He explained that the duty of 2s a quarter on wheat imported by Britain from foreign countries had been removed.

STIMULUS TO TRADE,

NEW ZEALAND’S CONTRIBUTION. Per Press Association. WELLINGTON, Nov. 18. New Zealand’s contribution to the commercial agreement which has been concluded between the United Kingdom and the United States of America was referred to by the Prime Minister (Rt. Hon. M. J. Savage), in a statement this evening. He said the consummation of the agreement, _ which would have the effect of bringing the two great English-speaking countries into closer relationship, was an event much to be desired and he was sure it would be looked upon with much satisfaction bv the people in New Zealand as well as throughout the Empire. The agreement aimed primarily at the expansion of trade between the two contracting cointrics, but it was to be expected, said Mr Savage, that it would have much wider influences to the extent that the agreement gave stimulus to trade New Zealand stood to gain in that the markets for her products in both the United Kingdom and the United States might be improved. The conclusion of the agreement was facilitated by the co-operation of the

Dominions in foregoing their rights to certain preferences fixed under the Ottawa Agreements, added Mr Savage. New Zealand’s contribution to the agreement was represented by concurrence along with other Dominions in the reduction of duties fixed in accord with the Ottawa Agreement in respect of apples, pears and honey entering the United Kingdom from foreign countries.

The following concessions had been made in favour of United States products; The apples duty was reduced during the period from August 16 to April 15 from 4s 6d per cwt to 3s per cwt.

The duty on pears was reduced during the period August 1 to January 31 from 4s 6d to 3s per cwt. The honey duty was reduced from 7s to 5s per cwt.