143 Record Of Conversation By Warwick Smith

31st July, 1956

CANBERRA

Dr Westerman, Mr Rattigan and I saw Mr Suzuki and Mr Uyama today at Mr Suzuki's request.

Mr Suzuki said that he wanted an indication of what Australia's requests were likely to be in the forthcoming trade talks, and what likely negotiating points, before the Prime Minister's visit to Tokyo.

Dr Westerman explained that the Australian Government had been trying to move forward in a stocktaking of Australian trade policy as a whole. The delay in coming to trade negotiations with Japan had been due to this process and not to any anticipated obstacles in getting a settlement with Japan.

Dr Westerman said that we understood that Japan wanted most- favoured-nation treatment, non-discriminatory import licensing and the application of G.A.T.T. to Australia/Japan trade relations.

Dr Westerman went on to say that Australia wanted broadly, the same things from Japan, but because of the Japanese trading system these would need to be defined so as to give practical meaning to the principles, e.g. non-discriminatory treatment in respect of State-traded products need not mean anything if the Government policy cost a large part of the market for a particular commodity to be preempted.

Australia, in the course of the trade negotiations, would want to find ways of removing the fences to Japanese imports. In doing so, however, there were very practical considerations that had to be faced. The major problem of a possible undue inflow of goods from Japan might be met in large part if the Japanese Government were able to ensure that no more than reasonable quantities were exported to Australia. However, the Australian Government would also need to be in a position itself to apply, should the need arise, any measures necessary to protect its own industries and pattern of trade.

Mr Uyama thought that what Dr Westerman had said corresponded pretty well with their own thinking.

With regard to the timing of the exchange of requests it was agreed that both sides would give further thought to this matter, but Mr Suzuki agreed that what Dr Westerman had said did remove some of the importance from a formal meeting next Tuesday at which requests might be exchanged. This point was left on the basis that both sides would have a further look at it.

[AA : A1310/1, 810/1/15]