Evening star., 1947-11-02

Ora1CeO Dy v. ~. PCPoA eRo0As o
mittee for action at Havana.
Central purpose Of the charter u
to help improve living standards
all around the world by promoting
expansion of international trade
fostering full production and en-
ployment everywhere and elcour'
aging the economic development o1
backward areas.
The Major Objectives
The charter is long, complex
document. Major provisions Of its
100 articles are aimed at eliminat'
ing discrimination in commerce be-
tween nations, reducing tariffs ano
cutting away as much as possible
Of the red tape that impedes the
flow of goods from one country to
another.
State Department officials who
have nursed the charter through
more than q year OF preliminary
negotiations with other nations
consider its key provisions as those
dealing with quantitative restric-
t,ons on trade. Such restrictions
are those which put rigid limits on
the quantity Of country's imports
or exports through quota or licens-
ing systems.
Unchecked growth Of such re-
strictions would be "the worst thing
that could possibly happen to the
trade Of the United States in the
opinion Of Clair wilcox, director OF
the State Departments ONCE Of
International Trade Policy. They
would stifie competition in world
markets and doom private enter
prise under drastic Government
regimentation.
Evils of Quota System
If the United States were face.
with quota systems all around the
world, 1t would have to bargain its
way into foreign markets, country
by country product by product
month by month. These negotiations
would have to be carried on by the
Government, not by private traders
There would be almost irresistible
pressure to increase American bar
gaining power by establishing ar
import quota system Of our own.
Ever since the war;" Mr.. Wilcox
points out, "our Government has
sought to remove controls and re-
store the freedom Of private enter
prise. But II we were to regiment
our foreign commerce We should
have to reverse this trend. Export
and import programs would have to
be made out and approved IN ad-
vance. Licenses would have to be
obtained for individual transactions
The business man, instead of buying
and selling whatever he chose, at the
time and the price that he chose
would have to fight his way through
a maze of controls"
The proposed ITO charter con-
demns quantitative restrictions on
commerce between nations in princi-
pie. 1t does not abolish them en-
tirely because, as a practical matter
their Use is reasonable under some
circumstances. But the charter
does confine their use to clearly
defined exceptional circumstances
and provide for constant control
through the ITO.
Some Exceptions
Two main exceptions to genera!
rule against any quota systems are
provided in the proposed charter
One permits import quotas on agri-
cultural products in surplus supply
but only when restrictions similar
in effect are applied to the same
products domestically. The Other
permits import restrictions wher
necessary to protect a country's
monetary reserves.
The first type Of exception woulo
cover operation Of the 1887 United
States Sugar Act, designed to keer
sugar prices at a reasonable leve,
by regulating the quality of sugar
whether domestic or. foreign, which
comes onto the market.
An exception allowing import re-
strictions to protect a country's In
ternational financial position II
made necessary by the hard fact
that nations, like individuals, can
not long continue to buy things fol-
which they cannot pay. If money
Is lacking, purchases must be cut
accordingly. The only effective way
in which a nation can reduce Its
total foreign purchases to the
amounts it can pay for is to impose
quantitative restrictions on imports
Such restrictions for this reason
are general now among the coun-
tries of Western Europe. Short OF
dollars and goods which they can
sell for dollars, they are having to
restrict drastically their imports OF
even essential goods like food and
coal that have to be paid for In
dollars.
But this condition cannot last for
ever. The ITO charter Is designed
to lay down long-term policies to
guide international trade In normal
times, with sufdcient elasticity to
enable member nations to meet
emergency conditions without losing
sight Of the long-range objectives.
Conference Well Planned
The proposed charter provides
that a nation using import quotas
to protect its financial position must
relax the quotas as its position i'm
proves and eliminate them entirely
when its money difficulties disap-
pear. Provision also is made for
consultation when quotas make for
hardship in other member countries
American oficials point to the
handling of the quota system prob
leysa l.. tho y,ro {ocf aI oh a ~ or ae q ~