258

9th October, 1929

PERSONAL AND CONFIDENTIAL

My dear Prime Minister,

I was able to get away from Rome on Saturday the 5th October and, travelling straight through, arrived in London on Sunday night after one of the most unpleasant of channel crossings.

INTERNATIONAL INSTITUTE OF AGRICULTURE, ROME

There can be no doubt that the first meeting of the new Agricultural Economics Committee at Rome was quite successful. A sane spirit of realism dominated the discussions and if the real Powers that be in Rome adopt the policy recommended by the Committee, considerable progress towards the reform of the Institute ought to be accomplished. Whether this will occur or not is problematical.

I took the opportunity at the end of the Conference to have a very frank talk with the Italian Secretary-General and a Dutch member of the Finance Committee of the Permanent Committee and explained to them how essential it was that Rome should be prepared for real reform if it was to anticipate the continued support of the countries of the British Empire.

You are probably aware that the International Institute was established at an International Convention in 1905 and that some of the quite urgently needed reforms would require an amendment of some of the Articles of the Convention. When the Secretary-General pointed this out to me, I very tentatively made the suggestion that, as there would be a General Assembly of the State Members of the International Institute next October, consideration might be given to the idea of a request being made to Governments to give their principal Delegate powers to attend a Diplomatic Conference for the revision of the Articles of the 1905 Convention. This idea was very well received by the Secretary-General and also by Mr.

Van Ryn. I satisfied myself that the Secretary-General had a real desire for effective work and for reform and that no opposition would come from him. If, therefore, the Italian Government can be convinced that it would be greatly to the advantage of the Institute, and also to Italian prestige, to have the Institution working once again at full strength and along sane lines, it may be possible to make a great deal of progress during the coming year.

I understand that the inter-Departmental Committee, which is sitting in London to consider the Agenda for the Imperial Economic Conference, would be prepared to suggest that the work of the International Institute of Agriculture should be placed on the Agenda; this, I think, would be very much to the good.

I shall, during the next couple of weeks, prepare a report on the work of the Agricultural Economics Committee and will also deal fully with the general problems of the work of the Rome Institute.

I trust that my report will prove of use to the Commonwealth Government both from the point of view of probable discussions at the Imperial Conference and also to enable the Commonwealth Council for Scientific and Industrial Research fully to appreciate the present position in Rome and the potentialities of the Rome Institute for useful service.

ECONOMIC ACTIVITIES OF THE LEAGUE OF NATIONS

Now that I am back in London, I have commenced to prepare a confidential report on the economic tendencies revealed in the discussions at the Assembly this year. I hope to complete this in the course of the next week or ten days and shall forward it to the High Commissioner [1], as the leader of the Delegation, for submission to you.

I was so unfavorably impressed with the degree of financial control of League expenditure exercised by the Fourth Committee that I am proposing, with the assistance of Major Fuhrman [2], to prepare another confidential report on this subject. I think it is inevitable that League expenditure must slowly increase but, as things stand today, there seems to be no effective method whereby the Assembly does exercise a real supervision of expenditure.

LABOUR COMMONWEALTH GROUP

The Labour Commonwealth Group is being reconstituted in the new British Parliament and will start its meetings shortly after the House assembles. I have been invited to give an address on the work of the Empire Marketing Board from the point of view of the Dominions. This will obviously afford an opportunity of explaining to the Group the immense importance of the maintenance of existing preferences. I hope that there will be a reasonably good attendance and a stimulating discussion.

THE IMPERIAL ECONOMIC CONFERENCE

I enclose a leading article from the 'Times Trade Supplement' which was written by the Editor on the basis of some very full notes supplied by me. [3] I hope that, if you have time to read this, you will agree that it was a useful line to develop at this juncture.

I am also enclosing a copy of an article on Imperial Economic Cooperation, the typescript of which was forwarded to you some time ago.

IMPORTATION OF SWEATED GOODS

I am enclosing a copy of a most interesting letter which appeared in the 'Times' of the 30th September from W. E. D. Allen [4], M.P.

one of the Ulster Members. The letter seems to me a quite admirable comment on this general question and the suggestion that the Government should consider the imposition of wages equalisation duties, although probably not of immediate political significance, is one which I have long felt merits close study.

I shall be very interested in any comment that you might care to make on this subject.

BRITISH MOTOR EXPORT TRADE

I am enclosing an interesting letter from Robert Horne [5] to the 'Times'. This letter has started a certain amount of correspondence. I was very glad that Horne expressed himself so warmly on the way in which the Commonwealth Government has assisted British trade in the recent Budget. [6]

Yours sincerely, F. L. MCDOUGALL

1 Sir Granville Ryrie.

2 O. C. W. Fuhrman, Private Secretary to the Australian High Commissioner 1922-26; often served as secretary to Australian delegations to the League of Nations.

3 Times Imperial and Foreign Trade and Engineering Supplement, 5 October. The editorial noted the serious ramifications for Empire trade of the 'increased severity of foreign competition' and the worldwide growth of economic nationalism. It forecast extensive discussion of these matters at the Imperial Conference proposed for 1930.

4 Conservative M.P. and company director; member of the Ulster Unionist Council since 1923.

5 Philosopher, barrister and conservative politician; President of the Board of Trade 1920-21; Chancellor of the Exchequer 1921-22;

chairman and director of major firms.

6 Times, 2 October. The preferential tariff concession on British motor chassis had been increased from 20 to 30 per cent.