Dispatch 44/1/43 WELLINGTON, 3 June 1944

I have the honour to refer to your telegram No. 104 of 29th May,
to the Acting Minister of External Affairs [1], Wellington,
concerning an invitation from the United States to a formal
Monetary Conference on 1st July. [2] In your telegram you
suggested that the two Governments should exchange views on the
attitude to be adopted towards the statement of monetary
principles and urged that they should reach an agreement as
precise as possible on the application to the monetary proposals
of the joint Australia - New Zealand Agreement on international
economic collaboration. [3]

2. In this connection, however, I would make the same point as I
made previously [4] concerning the International Labour
Organisation Conference at Philadelphia, and our approach to the
United States on the full employment issue, namely that the chief
New Zealand representative will be Mr. Nash, who is still Minister
of Finance, and that in the absence of himself and Mr. Fraser from
Wellington the New Zealand Government here will be unwilling to
issue very explicit instructions to him. In addition, the
Government's chief adviser on economic matters, Mr. B. C. Ashwin,
Secretary to the Treasury, is on his way to London and he would
probably return to Washington to assist Mr. Nash at the talks on
monetary policy.

3. I would suggest, therefore, that, if it is hoped to have a
joint Australian - New Zealand policy prepared in detail, it may
be necessary to refer your precise proposals to the Prime
Ministers of our two countries while they are in the United
States. As with our proposed joint approach on the full employment
issue I would suggest that our policy regarding an International
Monetary Agreement should be drafted in detail so that there is
little room for misunderstanding or lack of cooperation between
the delegates of our two countries.

4. I understand that Mr. Fraser plans to remain in London until
some such date as the 10th or 12th June. This will give him an
opportunity to have discussions with Mr. B. C. Ashwin, and with
Mr. G. A. Duncan, Director, Export Division, Marketing Department,
who are due to arrive in London on 6th June. The purpose of their
visit and of their discussions with Mr. Fraser is to pursue
negotiations for a long-term marketing agreement with the United
Kingdom and for a compensating fund to be set up in London to
offer increasing prices paid by New Zealand for British imports.

[5]

5. Although I have no detailed knowledge of these negotiations, I
understand that arrangements covering both these matters have been
concluded at least in principle between the United Kingdom and
Australian Governments. So far as New Zealand is concerned, I
judge that while an agreement on long-term marketing could be
assured the question of a stabilisation fund is the point still at
issue. While in London for the recent Dominion economic talks [6]
Mr. Nash carried on lengthy negotiations for the establishment of
this fund and I believe, succeeded in pushing negotiations to the
point of agreement to a fund totalling about 12,000,000.

Apparently, however, he was not satisfied with the results of his
discussions and left London without a final agreement being
reached. It is on this point presumably that Mr. Fraser's
discussions, supported by Mr. Ashwin and Mr. Duncan, will be
pursued.

6. I understand that, in the recent discussions concerning long-
term marketing, Australia House, London, was instructed to keep
the New Zealand representatives informed concerning Australia's
primary production programme, but I am not aware of the extent to
which there has been co-operation between Australia and New
Zealand in presenting their ideas on both long-term marketing and
on the equalisation fund. I should be glad if you could arrange to
have some information concerning these matters supplied to me here
so that I would be in a position to judge to what extent the New
Zealand Government were carrying out the terms of the agreement
regarding a full exchange of information and the pursuance of an
agreed policy.

TOM D'ALTON