American Reply to British Note: Will Consi ler Reasonable Suggestions Tondon, Dee. 5.
As some misunderstanding has occurred regarding the reference it the British Note on war debts consequences of a resumption of ents, the exact words of the ote on this subject ave given parts cal interes Oder aig, the it that the discharge of all international debts must finally take the form of transfer of out services the Note said:
"If therefore war debt payments Ihag to be resumed, it. is apparent: that the exchange position of this country" would nood to. be streng: thened' by a redaction of the heavy adverse balance of, trade between the United Kingdom and. the United States, which mounted to £78,000,000 in' 1931. 1a present clrenmstances this could only done by" adopting" measures which would further restrict British purchases of American goods. - The United Kingdom has up to the present been generally the best eustomce of the United States, and the result: of, such restrictions would evitably be ta reduce the market in the United Kingdom for American farm "products. To the extent, therefore, that payments were. re" nowed to the United. States Tr sury, definite and unfavourable re-faction must follow to the Unitel Btatos producer.
"Aforeover Hix Majesty's Government would also have to. guard effects which would fol-facilities offered by tha British market were used by the b other debtors of America to obtain sterling, which they would then sell across the exchange to. meet their obligations to the United States Government.
"After the War the United King. domi attempted to maintain its traditional system of free imports, with the result tha debtor countei throughout the world sold their fonda on the British "market and 10k the proceeds away in exchange or in gold to meet their obligations elsewhere, Under the stress of the present erisix His Majesty's Govern: ment still imports from abroad to the value of several hun-is of million pounds in excess of what it exports and it would be ne-onery "to" consider what. sation fold be taken to secure thatthe sterling, proceeds "of thole imports were "ised more avguly. for ths Wiretes Throug Reuter and American people have such a vital interest.
"The President of the United States is prepared, through what-fever agency may Government, to survey situation and to consider what means may be taken to bring about a restoration of the stability, currencies. and exchange, a revival of trade and a recovery of PEAT welcome the suggestion for a close "examination between the United States and Great Britain of the whole subject in preparation for an international economic conference, for T believe that there fare important avenues of mutual Advantage which -should be" thar-oughly explored. Such an examination does not imply cancellation, In such an examination there would necessarily be consideration of. other forms of tangible compensa fion available for an expansion of the markets for the products of American agriculture and—labour. And you will understand that the problem. of foreign debts. has, the American mind, a very defn relationship with the problem of disarmament and the continuous iden" which competitive armament imposes "upon the ent ing, the reply says the United States Government cannot accept the implications in. the British Note that the loans made the United States represent their entirety expenditure on. de= struction, that the payments hereto-Tore made to the United States have been largely responsible for the. world depression and the concentration of a large "amount of zold" inthe "United States and That m complete" cancellation "of war debts ix essential to world recovery.
Tt says that many of the loans made before the Armistice and substantially all made since were not for destruction und less than one-third of the amounts expended in the United States by her debtors after she entered the war sent for munitions and remounts. In reaching settlements. with thei debtors, the United States Government combined the loans—made during the War and after' the Armistice, including commercial credits, and funded all in debt Rome, Dee. 6 different, practice prevailed Early this, morning the Fa in Europe, the figures cited in the Grand council, in the. presence of British note are mot strictly come Signor Mussolini, delded to pay the parable. The. British war debt instalment due to the comed to over empha United States on December 15 une nonce -which war debt payne Joao other eireumatances. Intervene in the past on A communique states that while the Council invites the: Government morns. With the. variant to take this step, it also invitee the rth Government thee and. figures "present
the necessary negotiations in regard the American" Government order that before June, 1039, a new war not in accord, but it did not. greement may' te. reached' in acdesire to enter Into' a detailed dee cordance with the recent declaration cussion " in view 0 larger ly' President Hoover, 'The President. and his successor. general, it is their view that sleet, addr the. communique, may the causes of the depression lay in ake' into™ account the fact that much more potent forces than these fconomle circumstances in debt, Wansactions and that in the Reve alive me th days total of the receipts and outgo ati reached, war" dobe agreement vas ing from the international transac. ions of the debtor countries amd Tealy's prevent instalment, rep the United States, the debt. pay-seit fatten om pet ea cit only to "einslder Tavoucably the con-understood she is not prepared of these debts had drained the gold item. The argument that. payment rents had been a elatively minor
reserves of other countries to the United Stars did not seem borne out by actual experience, The main Washington, Die. 7. fault in the distribution of gold The Belgian Government has sent supplies seemed to have occurred us new Note to the United States tween the different countries of Government requesting an extension Europe and could not be attributed the moratorium on war debts, to forces originating in the United The, Note was presented to-day to States, The. Secretary of State, Colonel Regarding the statement that the emo, by the Belgian Embassy in devising the Lausanne tlement of reparations was tak a London, Dee. 8. ith the cognisance and approv of the United States Government, Secretary of State, Colonel Henry it says the facts wore more occur: lately set out by the Chancellor of the Exchequer's statement in July, namely, that the "proceedings there were throughout on the basis. that the right course was to -seck an Sas ce te can "Whatever part debt payments European solution without involving: {the United States in the discussion." a very definite ae, ec een After reviewing the circumstances under which the British Debt was funded, the reply concluded: "As to the payment due on December 15, T appreciate the cogency of the cliff: nities which you present ax to the transfer of these monies in the pres out state of foreign exchanges. In
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