TOKYO

The United States Embassy is showing great interest in the
question of Japanese admission to GATT countries. Economic
Counsellor Waring [1] called on me this week and stressed their
concern over impossibility of Japan feeding the population of 85
million when United States procurement orders and other
assistance, which is at present bridging the Japanese balance of
payments, declines, as it must. Procurement orders are already
declining and Japanese exports are also falling. Unless Japan can
find some markets she will be forced either into undesirable trade
practices or into co-operation with Communist China.

2. Waring is inviting several Commercial Counsellors to meet him
for a discussion of Japan's trade prospects. Carne will attend and
learn what he can of the United States view, but will exercise
great care not to commit Australia in any way.

3. I appreciate the complexity of Australian trade and tariff
policy issues involved but feel that from the purely political
viewpoint, great weight must be given to the considerations
advanced by Waring and which I understand will have been put to
you through the United States Embassy in Canberra.