641.6231/182: Telegram

The Ambassador in the United Kingdom (Kennedy) to the Secretary of State

376. Embassy’s telegram 373, March 20, 7 p.m. In discussing the joint declaration with Board of Trade official, he stated that no British industry had as yet reached an agreement with its German counterpart. He had been hopeful that the 50 industries might work out mutually advantageous price and marketing agreements but that under present political circumstances there was little hope of any agreement.

The official said that the plan had already been to invite industries in other countries to join any agreement reached with the Germans, thus forming, if it seemed advisable in each case, a cartel. With reference to paragraph No. 8 of the declaration he said that the German and English negotiators did not have the United States in mind when they drafted the language. It was devised he said to persuade certain countries to become parties to the agreement, particularly Japan and European exporters who might seek to under-cut in third countries the price level agreed upon by the English and the Germans, for example Swedish hollow-ware manufacturers.

Commenting on the same paragraph an official of the Federation of British Industries who was one of the negotiators at Dusseldorf said that it had so far proved impossible for the British manufacturers to come to any workable agreement with German industry with respect to South American markets, for any arrangement was soon nullified by the Aski mark system. Thus he said the Anglo-German agreement would not have threatened American trade in South America.

Lord Halifax39 told me that the British Government would not support the F. B. I.’s industrial negotiations in view of the political situation. It can therefore be taken as certain that nothing concrete has come of the Anglo-German trade talks and that they will not be resumed until some political settlement has been made.

Kennedy
  1. British Secretary of State for Foreign Affairs.