19th May, 1958
151. CONFIDENTIAL PRIORITY
TOKYO
The Japanese Government will issue a statement about consultations which will be within the terms of summary of conclusions agreed with the Embassy. The statement will use Japanese trade figures.
It will be cleared with us. No release at either end before early next week.
2. Suggest that the Minister is not obliged to make a press statement but if he does he can draw on the same summary of conclusions. If a release is proposed I suggest it be a not too elaborate version of the following which commences paragraph 3 and that you advise me for mention here of tiny additional points to be made. Should the Minister decide to issue a statement suggest an appropriate time might be 7 p.m. next Monday evening. Would you cable decision on this?
3. The statement could indicate that the first of the annual consultations provided for in the Trade Agreement between Australia and Japan was recently concluded in Tokyo.
4. Consultations took the form of reviewing all items of the Agreement and the confirming and strengthening procedures which had now been developed on both sides for giving effect to the agreement. Both Governments are satisfied that the procedures are operating fairly and effectively and with mutual advantage to the trade of both countries.
5. Japanese exports to Australia are increasing at a reasonable rate and would probably reach 25 million for 1957/58 compared with 18 million average for three years ended June, 1957 and 12.9 million for 1956/57. This progress had been achieved within the safeguards of the Treaty which had operated to prevent serious damage to Australian industry.
6. Despite the serious decline in world prices for commodities exported by Australia, especially wool, Australian exports to Japan for 1957/58 are likely to exceed the average for the three preceding years although there would be fall in the total value compared with 1956/57. Japan has been a major support in the wool market and has under the Treaty provided very important new markets for wheat and sugar together with smaller but useful openings for dried vine fruits and dried milk.
7. All other commodity undertakings by Japan (e.g. barley) are being met and a substantial development of exports of Australian coal was occurring under the assurance of most-favoured-nation treatment now given by Japan. This assurance means that Australian suppliers have equal rights with other suppliers to seek markets for raw materials (e.g. coal and minerals) needed by Japan.
8. I have not spoken to the press here at all and the short and rather innocuous statement about the discussions which appeared Saturday press Tokyo must have come from Japanese sources.
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[AA : A1838/280, 3103/10/2, v]