326 Prime Minister's Department to Mr S. M. Bruce, High Commissioner in London

Cablegram 973 1 March 1941,

The following message has been received from the Australian Minister, Tokio [1]- Begins.

'Vice Minister for Foreign Affairs [2] sent for me specially to ask that consideration be given to Japanese wool requirements. Did not disguise that some required for Army use but also wishes to keep manufacturing industry going. Wool interests have made similar representation. Commerce Bureau official gave details.

Would like Cross-bred, but recognise difficulties in the way. They ask for merino types which I am asked to describe specifically as follows:

"For warp and/or weft-from 64's to 70's;

For warp and/or weft-from 60's to 66's;

For warp and/or weft-from 64's to 66's.

It is asked that these types be about 71% of supplies in same proportions as in the first seven releases. Official says that if some concession cannot be made, Japan cannot continue present self-imposed obligations to purchase from Australia two-thirds of wool imports. Guarantee will be given against wool reaching enemy.

I have said that war requirements are necessarily dominant and this is admitted. If, however, request could be granted to some extent, it would be very greatly appreciated. The British Ambassador [3] agrees with me that it would be wise to consider requests with sympathy.' Consul General, Australia [4], has also written to Acting Prime Minister [5] requesting sympathetic consideration of wool supplies. Shorn of unimportant passages, his letter [6] reads:

'I desire to inform you that at present, on account of the prohibition of the sale of certain types of wool to Japan, Japanese merchants in Australia are finding themselves in a very difficult position. Particularly has this been the case recently, when alarming reports of the deterioration of the relations between Australia and Japan have been in circulation and I am sure you will agree with me that the responsible statesmen of our respective countries should strive, by every means in their power, to achieve a better and more harmonious understanding between the two countries. Not only is the wool trade the backbone of the trade between Japan and Australia but it is also one of the most important evidences of the cordial relations existing between the two countries. If, at the present moment, when sensational reports are current regarding the relation between the two countries, the purchases by Japanese merchants of their ordinary requirements of wool could be made, this fact would no doubt greatly contribute to the lessening of the anxiety caused by the present situation. For this reason I wish, on behalf of the Japanese merchants and under the instruction of the Japanese Government, to approach you in order to enquire whether your Government will, at this time, use its good offices, with a view to the granting by the British Government of permission for the allotment to Japan of, say, 50,000 bales of wool of merino types containing free to few burrs.

If you can do so I shall be greatly obliged as the interruption of the wool trade naturally leads to decrease of business so that the Japanese merchants are compelled to return to Japan, an effect which, in my opinion, we should strive to avoid.

Should this matter receive your favourable consideration I shall at once instruct the representatives of Japanese firms to get into touch with the Central Wool Committee in order to supply further particulars of their requirements. I shall greatly appreciate any endeavours you may make for the furtherance of the trade in the abovementioned direction which will contribute to a better understanding and the lessening of the tension, if any, between our two countries.' Government and Central Wool Committee are aware of the reasons for the present ban but Government feels it must ask you to submit to proper authorities in U.K. the representations as given herein.

Have suggested to the Australian Minister, Tokio that British Ambassador would probably help position if he cabled his views to his Government. Intervention by Japanese Government is apparently at instance of commercial interests involved and Minister at Tokio apparently considers conciliation of those interests to be of some value. As you already know, Government here have, on numerous occasions, notified representatives Japan that wool is property of United Kingdom Government and its disposition rests entirely with that Government. In requesting you to place matter before U.K.

authorities our purpose is not to urge any particular viewpoint for we consider there is no need to stress again Australia's position vis-a-vis Japan. We feel, however, that in general consideration of position, this latest development on wool supplies may be of sufficient importance not to be ignored.

Central Wool Committee has cabled Essendon [7] in this matter.

Please contact him and hand him a copy of this message.

1 Sir John Latham. The cablegram (no. 97 of 24 February) is on file AA:A981, Trade 68, iv.

2 Chuichi Ohashi.

3 Sir Robert Craigie.

4 Masatoshi Akiyama.

5 A. W. Fadden.

6 Dated 17 February. See file cited in note 1.

7 Chairman of U.K. committee for Sale of Empire Wool Abroad.

[AA:A981, FAR EAST 20B, i]