TRADE PACT

Star (Christchurch), Volume LXVI, Issue 20235, 20 February 1934, Page 1

TRADE PACT

ANGLO-SOVIET TREATY PUBLISHED. Favoured-Nation Treatment. AGREEMENT TERMINABLE AT SIX MONTHS’ NOTICE. British Official Wireless. (Received February 20, 12.35 p.m.) RUGBY, February 19. The text of the Anglo-Soviet Temporary Commercial Agreement has been published. The previous agreement was denounced in October, 1932. firstly because it was felt that the usual most-favoured-nation provisions incorporated in the agreement did not operate satisfactorily, owing to the fact that the foreign trade of one of the parties was conducted by the State, and it was not possible to claim that the most-favoured-nation provisions had been infringed on the grounds that a monopolistic State refrained from buying United Kingdom goods; and secondly because it. was felt that the obligation undertaken to Canada at Ottawa to safeguard preferences against the creation or maintenance of low prices by State action made it impossible to continue to give unqualified most-favoured-nation rights to the Soviet Union. The first article of the new agreement is a most-favoured-nation article ©n the usual lines. It is qualified in Article 2, which provides that either party may represent to the other that tuch prices are being created, or maintained, by the latter as are likely to frustrate the preferences accorded or injure home production. Such representations shall be followed by negotiations. If these negotiations fail the first party may, at three months’ notice, intimate that most-favoured-nation treatment in respect of import restrictions and prohibitions shall cease to apply to the goods in question. In Article 3 the Soviet Government expresses a desire to spend more of the proceeds of the sale of its goods in Britain upon the purchase of British goods and on British shipping services and undertakes to give effect to the provisions set out in the schedule, which lays down that Soviet payments are to bear in each year an increasing ratio to the Soviet proceeds until after a transitional period of four 3-ears there is an approximate balance of payments. Article 4 provides that trade between the United Kingdom and the Soviet Union will be eligible for any Government export credit facilities on the same basis as trade with other couatries. The protocol to the 1930 agreement contained a similar provision. Article 5 deals on similar lines to the 1930 agreement with the position of the Soviet Trade Delegation. Article 6 provides for a reciprocal grant of most-favoured-nation treatment to shipping. Article 7 contains certain reservations in respect, to preferences, etc. Article 8 provides that as long as Soviet goods receive most-favoured-nation treatment in any Empire country*, apart from the dominions, which are outside the scope of the agreement, the goods of that country shall receive such treatment in the Soviet Union. The agreement is terminable at six months’ notice on either side.