Bilateral Trade Annoys United States

Chronicle (Levin), 23 June 1949, Page 5

Bilateral Trade Annoys United States

LONDON, June 20. Articles in -a number of Britisli newspapers suggest that American disapproval of Britisk policy in contracting bilateral trade pacts, and eulminating in the American intervention in the present negotiat'ions between Britain and Argentina, may lead to deteriorat■ing relations betw&en Britain and the United States. Sharp disagreement between the two countries over trading methods emerged into the open last week, when the American Economic Cooperation Administrator, Mr. Paul Hoffman, who_ had previously strongly defended Britain against her crities in the United States Senate, described the proposed five-year Anglo-Argentine trade pact as " a dre-adful defiance" of the principles underlying Marshall Aid. In a dispate'h to his newspaper from New York, the correspondent of the Manchester 'Guardian says this morning: -"The -way now seems to be open for an ear-slitting showdown between Britain and the United States over the future eonduct of international trade under the Marshall Plan. ' '

The London correspondent of the New York Times, xep'orting on British reactions, said that there is a general feeling that .a phase of diffieulty^ and misunderstanding in Anglo-British : eeonomic relations is to be expeeted. This jnewspaper said that the British only now seemed to be realising that Americans are deadly serions about ending bilateral and diseriminatory ; trade, while Americans .on their part did not4 seem to realise that some of these bilateral agreements meant beard and bntter to the British workman, and that the British will' dig in their toes against any .attack on their standards of living. 4 American disapproval of bilateral trading, although it has long been known, first emerged during the negotiation of the Geneva Agr.eement, when America insisted that subscribers to that agreement should anprove dn prineiple a return- to multilateral trading. Subseqnently difficulties over eonvertibility and balauees of payment apparently convinced the Americans that fchey conld not alford to insist for the moment upon strict adherenee to these principles. Sir Stafford Cripps's policy of ckcnmventing Britain 's dollar 8hortage by making bilateral agreements with other countries, under which Britain obtains supplies she cannot obtain from the dollar areas," is now

being opposed by the Americans on the ground that these paets tend to isolate the dollar area and mav ultimately create a situation potentially dangerous to Amjerican trade. They further argue that oue of the main purposes of kjarshall Aid is to break down bilateral -and diseriminatory trading, .and that Britain, as one of the main benefieiaries under Marshall Aid, should not be taking the •lead in promoting ' negotiatioas con■trary to its princnples. This agreement has all the elements necessary to pro■mote a first-class international controversy. One of the chief arguments of British critics of Marshall Aid, and ibefore that of the American loan and of the Geneva Agreement, has been thnt -all these arrangemen'ts placed Americans in a position to interfere Tn Bri•tain's -domestie affairs. It is certain that these arguments will be revived as a result of the United States expressed disapproval of the Argentum Bact.