328 Commonwealth Government to Lord Cranborne, U.K. Secretary of State for Dominion Affairs
Cablegram 113 CANBERRA, 11 February 1942
SECRET AND IMMEDIATE
Your telegram D.67 and earlier telegrams Lease-Lend Agreement. [1] Commonwealth Government has been giving close consideration to this question. [2] We think that an agreement with United States should be reached as soon as possible and that the difficulties raised by Article VII should not be allowed to impede early agreement.
A general relaxation of trade barriers would seem to be possible if the positive aims of collaboration referred to in Article VII are achieved, i.e. 'the expansion of production, employment and the exchange and consumption of goods which are the material foundation of liberty and welfare of all people'. Australia would be willing to share in agreed action to achieve these positive aims. Consequently British countries should be prepared to accept the general commitments involved in Article VII even if this involved some modification of existing preference schemes.
Achievement of the objectives would obviously be gradual. In order to make this clear we suggest that the United States should be asked to amend Article VII so as to insert the word 'Progressive' before 'elimination' to read 'and to the progressive elimination of all forms of discriminatory treatment in international commerce . . . '. We consider this meaning is already implicit in the present wording and it need not be pressed if it proves quite unacceptable to the United States. [3]
Our view in short is:
a. Article VII can provide general basis of post war economic order so long as it is regarded as an objective to be realised gradually. b. We are committed to such an objective by Atlantic Charter and recent multilateral declaration of Washington. c. It is of supreme importance for British countries to assure U.S.
Government and world that our declarations are intended to be carried out in spirit as well as the letter. d. We must place trust in the common sense as well as idealism of those who will carry out the objectives of the proposed agreement. [4]