28 Evatt to Fraser

Letter CANBERRA, 24 January 1944

SECRET

With reference to the recent exchanges of views of New Zealand and Australian Ministers and officials, relating to pending overseas talks on post-war international economic collaboration, it now seems to me that the following clearly expresses our common point of view:-

(1) Because a high level of employment is a fundamental condition of better standards of living throughout the world, it is agreed to press strongly for an international agreement by which (a) subscribing countries will bind themselves to pursue domestic policies aimed at full employment and (b) existing organizations (such as the I.L.O.) will be used, or a new international organization established, to facilitate the exchange of information and consultation with each other on employment policy, and generally to give effect to the international agreement.

(2) During the immediate post-war period the economic situation will be in a state of flux, and the economic policies of all countries will still be unsettled. It is agreed, therefore, to advocate and support such forms of international economic collaboration in the transition period as should make it unnecessary for countries to adopt policies of aggressive economic nationalism.

(3) Every effort should be made to obtain as a permanent feature of international economic relations, a maximum degree of collaboration. However, because of the uncertainty of the economic future it may be impracticable at the outset for many countries to accept inflexible obligations of a far-reaching character. In such circumstances it is desirable, as a preliminary step, that limited agreements should be sought which would provide at least for regular consultation between nations. These may well lead progressively to more comprehensive agreements.

(4) It is necessary for countries which are not fully developed or are highly dependent upon a narrow range of exports to be able under any agreement- (a) to use such economic measures, for example, import selection, exchange control, state trading and British Commonwealth preferences, as may from time to time prove necessary to ensure continued stability. The need for these measures will decrease to the extent that international collaborations prove successful;

(b) to develop and diversify their industries.

(5) All agreements affecting Australia and New Zealand should take into special account the dislocations and developments which have been made necessary by their total war efforts, and also of accumulated needs resulting from the prolonged diversion from their peace-time production.

If you agreed, these general lines of policy should be used as the basis of a directive to the officials taking part in the pending overseas talks.

It seems to me that the time is fast approaching when the governments arranging these talks and putting for-ward proposals informally should be expected to put them forward on the footing of government responsibility.

H. V. EVATT

[AA:A989, 43/735/168]