520 Department of External Affairs to Sir John Latham, Minister to Japan

Cablegram 183 25 June 1941,

SECRET

Your 310. [1] We have under immediate consideration this and other telegrams from you on economic warfare measures as affecting Japan and propose consulting United Kingdom Government on general policy.

In the meantime the following summary of economic policy adopted by Australia and at present operating, may be useful to you in discussion with Japanese:

(1) All strategical materials other than wool, zinc, lead, scrap iron and steel. Exports to Japan are permitted up to the average pre-war level of exports.

(2) Cereal foodstuffs. We have sold large quantities to Japan and generally speaking we have supplied Japan with as much as she has offered to pay cash for.

(3) Oil bearing foodstuffs such as copra. We have never supplied Japan with these in quantities now desired, and Japanese demand comes to us solely for the reason that N.E.I. and United States have taken steps to reduce substantially supplies to Japan.

Our general policy of limitation to pre-war level, views of United Kingdom Government and restrictions by N.E.I. and U.S.A.

Governments will largely decide this question, which is still under consideration.

(4) Wool. Empire's need precludes meeting Japan's full request as to types. With respect to lead, we are supplying almost twice as much as average pre-war level and feel we may have to reduce this to the average pre-war figure. Zinc. Permitted exports are only slightly lower than average pre-war level. Scrap iron and steel.

You are familiar with the reasons for prohibition as well as our own war needs.

We will advise you further as soon as review of policy has been completed.

1 Document 518.

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