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14 Richardson to Wheeler

Letter (extract) [SYDNEY], 24 April 1948

DOLLAR STATISTICS AND POLICY

I commence my reply to your letter of 19th April [1] at paragraph
35 because I want to assure that you do not have to convince me of
the need for all of us to understand just what we are trying to do
about the dollar statistics and related matters. Surely you will
remember that in our discussion a month ago I pressed the need to
lock a number of people (not including me) in a room and to keep
them there until they ironed out the statistical aspects. And now
to turn to the important parts of your letter.

2. Your paras. 2, 3 and 4
I agree with your aim to keep Australia in the dollar pool on a
flexible 'gentlemen's agreement' basis. Perhaps the last part of 4
would be better stated somewhat along the following lines 'we take
note of the changing fortunes of the dollar pool [and] practice
the maximum degree of economy in dollar expenditure that seems
necessary from time to time'. This, of course, is vague but it
seems to me to express what we really feel about the matter. I
don't see how we measure our economies against those of the U.K.

or, for that matter, any other member of the sterling area.

3. Your para. 5
My reason for supporting a draw from the I.M.F. was not because I
thought that something less than our present gold holdings and
drawing rights were sufficient as an ultimate reserve but because
I thought the U.K. request was not unreasonable in light of our
expected dollar deficit of $150 million or more this financial
year.

4. Your paras. 6 and 7
I would like to avoid further cuts in our import programme until
we see how E.R.P. [2] is going to work. In light of what we have
done this may be practicable. At least we can defer a judgment
until your cable re the I.M.F. drawing goes off and the reply
comes to hand. Maybe, however, the price of deferring further cuts
win be a drawing from the Fund. If so, I would make the draw. I
think that E.R.P. must give us some indirect benefit. It seems
convenient to mention here also that I am much concerned about the
possible effect on our economy of the cuts already made in our
dollar imports and I think we should give high priority to the job
of really examining our position from this angle.

1 Document 12.

2 European Recovery Program.


[AA: A2910, 453/7/1, vii]
Last Updated: 11 September 2013
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