The Japanese Ministry of Foreign Affairs presents its compliments
to the Australian Embassy in Japan and has the honour to forward,
as enclosed herewith, a copy of the arrangement for sale and
purchase of Australian barley which was signed on 14th November by
Mr H.M. Tomlinson, General Manager, Australian Barley Board and Mr
S. Tohata, Director, Food Agency, Japanese Government.

The Ministry highly welcomes the finalisation of the present
arrangement and, on this occasion, has the pleasure in expressing
its willingness to enter into negotiation with the Australian
authorities, if they so desire, with a view to concluding similar
agreements over other essential commodities as well. In the
Japanese view, these sorts of agreements will, to not a small
extent, contribute to bring about an orderly expansion of trade
between Japan and Australia, which, the Ministry believes, is the
common objective for both countries.

In this connection, the Ministry has the honour to refer to the
current pattern of trade between two countries, in particular, to
the running deficit in payments on the Japanese side. An overall
balance with the Sterling Area as a whole being the primary
concern for the Japanese Government, they positively never intend
to stabilize Japan's sterling payments relation on the country-by-
country basis. However, the recent trend in the Japan-Australian
trade makes the Ministry feel impelled to draw attention to the
Australian authorities to the matter and ask for favourable
considerations on the Australian side to re-examine at this stage
possibility and advisability to see that import restrictions
against the Japanese goods in Australia be reasonably eased. In
putting forward this proposition, the Ministry feels all the more
justified since, as expressed by conclusion of the arrangement
over barley, the basic policy to promote Japan's imports from
Australia has been and will be pursued to the maximum extent
practicable by the Japanese authorities. The Ministry has pleasure
in reiterating its readiness to discuss with the Australian
authorities any problems involved in this respect whenever the
latter desires.