In reply to your note of December 17, 1943 , I have the honor to state that I have been instructed by the Secretary of State to inform you that he shares your regret that it is impracticable at the present time to attempt the negotiation of a reciprocal trade agreement between the United States and Australia. In order to avoid any misunderstanding I have been requested to make the following observations with respect to certain points raised in your note.
The United States Government initiated the proposal to undertake simultaneously the negotiation of reciprocal trade agreements with the United Kingdom, Australia, New Zealand and South Africa because of the complex relationship and its interdependence between possible United Kingdom concessions on agricultural products to the United States and possible United States concessions on agricultural products to the Dominions. In conversations between United Kingdom and American officials in October, 1943, the United Kingdom Government first made known to the United States Government its position that it would be inadvisable to pursue the project further. It was assumed that the United Kingdom Government had previously made known its position to your Government, perhaps at the preceding informal discussions between representatives of the United Kingdom and the British Dominions held in the summer of that year. 
As you observe, the discussions begun in 1941 between the United States and Australian representatives were protracted. The American representatives frequently urged that efforts be made to expedite the matter. They were aware, however, of the difficulties with which the Australian Government was confronted, both as a result of war and of local conditions in Australia.
In Paragraph 3 of your note reference is made to the assistance rendered by your Government in connection with the negotiations in 1937 and 1938 leading to trade agreements between the United States and the United Kingdom, and the United States and Canada.
The United States Government is not unmindful of this and appreciates the assistance rendered.
Paragraph 4, however, appears to be susceptible to the interpretation that my Government assumed some obligation to the Australian Government in connection with the trade agreements that the United States negotiated with the United Kingdom and Canada in 1938. Such an interpretation would be correct only in the sense that the Department of State was desirous of negotiating at a propitious time a mutually satisfactory trade agreement with Australia. To implement this desire my Government in 1941 initiated the proposal to try to work out mutually satisfactory bases for the simultaneous negotiation of agreements with the United Kingdom, Australia and New Zealand and South Africa.  It is regretted that our efforts did not meet with success.
With reference to your statement that your Government was led to believe that the tentative offers presented by its representatives were satisfactory in principle, I should like to point out, in order to avoid future misunderstanding, that our representatives consistently took the position that it would not be possible to reach a basis for definitive negotiations unless your Government indicated a willingness to consider meeting the tentative American requests or make counterproposals of equivalent value. Our representatives indicated, moreover, that they considered that the tentative offers made by your Government failed to satisfy these requirements.
I should like to take this occasion to express on behalf of the Secretary of State his appreciation of the immediate response of your Government to his invitation, given in 1941, to send a delegation to Washington to explore the possibility of negotiating a trade agreement. He was particularly gratified that your Government should send on this mission, at a time when the pressure of government work in Australia was extreme, high ranking officials whose services must have been in great demand. The cooperative attitude of these officials was deeply appreciated.
Accept, Sir, the renewed assurance of my highest consideration.
NELSON TRUSLER JOHNSON