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Historical documents

162 Coombs to Chifley

Letter LONDON, 14 October 1946

The British Commonwealth talks [1] have now been completed and
have proved, I think, well worth while. They enabled us to clarify
our ideas quite a lot and they indicated a much wider area of
agreement than I anticipated. I attach a summary of the matters
dealt with which you might be interested to read. A longer
statement has been forwarded to the Departments.

Our suggestions to strengthen the employment provisions by
extending them to cover development in the full use of current
international resources as a means to increasing the international
demand for goods received general support. The proposal to enable
us to modify our obligations under other parts of the Charter in
the event of major countries failing to maintain full employment
got better support than I expected, and I think we may get
somewhere with it.

Our proposals for making specific provision for industrial
development and establishing the right to use tariffs and other
protection measures to promote industrialisation were well
supported in general principle. The U.K., however, are afraid of
the effect on their own export trade, while New Zealand and Eire
seem to think that perhaps they might be freer if no specific
provisions were included in the Charter at all. It seems pretty
clear that the U.K. still intends to press strongly for membership
of the international Monetary Fund being a requirement for
membership of the I.T.O., although they agree that it should be
possible to belong to the Monetary Fund without being a member of
the trade organisation. Their main argument is that unless this is
required, it would be necessary to write into the Charter of the
trade organisation practically all the provisions of the
International Monetary Fund relating to alterations of the
exchange rate.

It does not seem likely that we will get much support in our
proposals for objective criteria for the application of
quantitative restrictions. The U.K., who also are very keen to
have the United States proposals modified, argue very strongly
that the establishment of objective criteria would make it very
difficult, if not almost impossible, for a country to take action
if those criteria were not fulfilled. Consequently every country
would press for criteria that would be so high as to leave them
practically complete freedom.

I am seeing some of the Treasury people today and will probably
have a preliminary talk about London balances.

1 Preceding a meeting of the ECOSOC Preparatory Committee for the
United Nations Conference on Trade and Employment. See Documents
154 and 159.

[AA:A1067, ER46/1/27]
Last Updated: 11 September 2013
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