TRADE & ECONOMIC SECURITY

Rotorua Morning Post, Issue 5284, 21 December 1946, Page 7

TRADE & ECONOMIC SECURITY

DISARMAMENT ISSUE HOW FAR WILL UNITED STATES REDUCE TARIFFS? LONDON, December 1:2. By now piublic opinion in Britain has had an opportunity to learn about the recommendations of the Preparatory Committee on Trade and Employment, which completed its tal'k in London at the end of November, writes John Kingsley, the eccmomist. Optimism with regard to the distance travelled from the grand phrases of the Atlantic Charter, mutual aid agreements and United Nations declarations towards a new structure of world trade must be guarded, The man in the street in London, New York and Paris fully agrees with the idea that economie seourity and disarmament are desirable and even necessary; full employment and flourishing trade are as dear to the man in the street as to. the delegates of the, 17 countries, representing between them a very lai'ge proportion of world trade, at the recent London conferenee; and the hecessity of & world organisation to take care of international trade and employment is still beyond dispute. • But it with some trepidation that the man in the street asks: "Are the recommendations as suggested in London "sweeping enough to secure and safeguard full employment, a rising standard of living* and an unhampered flow of trade throughout the world ? " Economy in Man's Best Interest. On the eve of international consultations the President of the Board of Trade declared that we must do something better, more courageous and more imaginative after this second World War than was done after the last. "We need boldness and realism in dealing with the world economic situation and faith that a man-created economy can by men be ordered in the best interest of mankind." Are the London recommendations realistic and courageous enough to attain the high purposes of the Internaitonal Trade Organisation? As for realism, the man in the street wonders whether the drawing up of a code of conduct for international trade is an approaeh faetnal enough for a world which is still very such and is more in need of convalescent treatment than rules on table manners at a table almost without food. As for speed, some experts are apprehensive that the world is drifting towards a new slum era unless quiclc and energetic measures are adopted to prevent it. One must recall that the British and United' States Governments started discussions on problems of commercial policy in 1943; United States proposals for consideration by the International Trade Conferenee were puhlished in Washington in December, 1945, when it was hoped that international discussions might begin in the spring of this year, not only to discuss principles but to get down to bargaining on tariffs and preferences. The open— ing of discussions was delayed until last October, negotiations and tariffs may begin in April; the final Charter of-the International Trade Organisation may be ready by the end of 1947 or later, and considering the time needed for its ratification# it will probably be well into 1948 before the new organisation will be in operation. Tariffs and Preferences. No one in partieular is responsible for the slow march of events, but the man in the street cannot help wondering whether the rhythm of action is in accordance with the urgent needs. of the world. The core of the problem is how far the British and Americans can go in mutual reduction of tariffs and preferences. The British point of view was clearly stated by the Prime Minister, who, on December 6, 1945, declai'ed there was no commitment on any coun'try, in advance of the negotiations, to reduce or eliminate any margin of preference and there was no question of any unilateral surrendel' of preferences. Britain is ready to reduce preferences if other natiofts offer compensating advantages. According to Press reports, a number of Republic Party spokesmen in the United States have declared

that formidahle industrial forces, now supporting the Republican majority, had been foremost in their demand for tariff revisions, emphasising the need for agreement with the British Empire. Under the Trade Agreements Act of 1934, the United States administration holds power to reduce tariffs up to 50 per cent. Is the democratic administration ready to use these powers in the face of the Republican majority in the new United States legislature? Will a cut of 50 per cent. be enough to compensate for reduction or elimination of Empire preferences so desired by the United Sthtes? Is it out of the question that the Republican majority may yield to the persuasion of that part of Congress which since the days of Hawley-Smeet has been in favour of high tariff walls? These are very grave problems especially in the light of a recent statement by the Chief of the State Department's Commlercial Policy Division who declared that the United States will insist on the "safety clause' 'in any trade agreements concluded . with Britain and other countries — a clause to withdraw any tariff concessions deemed harmful to United States economy. ,'No one can blame a country even as powerful as the United States for taking care of her economic security •by safety clauses or any othe- means; though one cannot help regretting that in addition to a future Charter for Intei-national Trade and Employment any country should feel it necessary to adopt such a drastis^ safety clause it may be hoped that the operation of international trade organisations and the spirit of the-,negotiators will render such special protective measures unnecessary.