215 Coombs to Chifley

Letter (extracts) [WASHINGTON], 7 June 1943

Food Conference. The Food Conference is now over and the general feeling appears to be that it has been a very real success. [1] You have received by this time a summary of the recommendations which Dr. Evatt forwarded. [2] Four copies of the final act of the Conference and the reports of the various sections are being despatched to External Affairs with this mail. [3] Dr. Evatt was a little concerned at the fact that one of the resolutions dealt with the desirability of reducing trade barriers, as he thought that this might possibly prove embarrassing to the Government during the election campaign.

The attitude I took in this section was that the greatest emphasis should be placed upon the maintenance of full employment in industrial countries and the development of under-developed areas and that progress in the reduction of trade barriers could be expected only if these positive objectives were achieved. This view was accepted by the section and I think is embodied quite clearly in the resolutions. The resolution dealing specifically with the reduction of trade barriers was introduced by the American Delegation in terms almost identical with those used in the relevant section of Article VII. I suggested that in order to re-emphasize the prime importance of an expanding economy that the resolutions should be introduced by the phrase 'progressively with the achievement of full employment and the development of under- developed resources' and that no specific reference should be made to tariffs but to trade barriers generally, on the grounds that tariffs were a legitimate means of maintaining employment when world economic conditions were unfavourable and a legitimate instrument of industrial development in less developed countries.

The Americans at first were willing to accept these changes but subsequently withdrew their agreement on the grounds that this would have meant going back on an undertaking to which the majority of governments present were already committed in Article VII. I pointed out that Article VII quite clearly envisages that positive measures of increasing production and consumption would go with measures taken to reduce trade barriers and, accordingly, I suggested that the clause might be introduced with the phrase 'as part of this general programme'. The Americans accepted this and agreed to drop the specific mention of tariffs.

In view of Australia's adherence to Article VII I feel that it would not have been possible for me to press for further modification.

There was a good deal of compromise in the final results and some pretty loose thinking, but I am satisfied that the work of the Conference lays down a basis for food and agricultural policy which, if adopted generally by the participating countries, can have very marked effects. The work done on the measures necessary to improve agricultural efficiency and to make easier the adaptation of rural production to changing conditions was, I thought, particularly good.

There was one rather important division of opinion. The conclusion reached in relation to the immediate post-war period was that we must expect a very severe shortage of even energy giving foods (grains, etc.) and that, therefore, it will be necessary in the immediate post-war period to concentrate on the production of foods for direct human consumption rather than for the rebuilding of livestock herds, etc. It was thought that even where substantial surpluses would be available, such as in wheat, transport difficulties are likely to prevent European shortages being overcome by this means, particularly if the Far Eastern section of the war continues for long. Some people fear that if this policy is pursued in Europe it will re-establish the practice of substantial grain production and the opportunity will be lost to place European agriculture on a basis which will make it complementary rather than competitive with the agriculture of the main exporting countries. It is a difficult question and in my mind turns largely on the validity of the account of shipping difficulties on which the Conference's judgment was based. I find that there is some skepticism about this in other quarters which think that it will prove possible to ship a much larger quantity of wheat and other food products from the main producing countries than this account assumed.

[matter omitted]

Financial Discussions. Dr. Evatt has cabled you to-day [4] suggesting that a postponement of the London talks for a week be sought so that I can attend these joint discussions on the Stabilization Fund and Clearing Union plans. I have not yet received anything formal from the U.S. Treasury but I understand that they have made fairly substantial modifications to meet the points we put forward in our discussions. I think it would be worth while participating in these talks.

[H. C. COOMBS]

1 The United Nations Food and Agriculture Conference was held at Hot Springs, Virginia, from 18 May to 3 June. The Australian delegation was led by Coombs and included McDougall, E. J.

McCarthy, Brigden and Burton.

2 See cablegram E132 of 4-5 June (FA:A3195, 1943, 1.23629, 1.23609).

3 Not found.

4 See cablegram E147 on file AA:A989, 43/735/56/3.

[AA:A571, 43/1354]