FOREIGN ECONOMIC AND COMMERCIAL POLICY


721


II. UNITED STATES CONCERN AT THE DISCRIMINATORY ASPECTS OF
  EXCHANGE AND       IMPORT RESTRICTIONS MAINTAINED            BY   THE
  UNION OF SOUTH AFRICA

NAC Files,' Lot 60D137, Box 362
Draft of Ainutes of the 151st Meeting of the National Adisory
   Council on    International Monetary     and   Financial Problems,
   IVashi'ngton, February 28, 1950 2

SECRET
   [Here follow list of names of persons present (27) and discussion
of a prior lagenda item.]

2. South African Restriction'3
   Mr. Glendinning4 said that the United States Executive Direcor
on the Fund had requested Council advice as to what attitude he
should take in the Fund on the maintenance of exchange and trade
  'Master fle of the document of the National Advisory Council on International

Monetary and Financial Problems (NAC) for the years 1945-1958, as maintained
by the Bureau of Economic Affairs of the Department of State.
  STheNational Advisory Council was an interdepartmental committee estab-
lished by the Bretton Woods Agreements Act of July 31, 1945 (59 Stat. 512).
The act provided for U.S. participation in the International Monetary Fund
(IMF) and the International Bank for Reconstruction and Development (IBRD,
or "the Bank"). The National Advisory Council was to coordinate
policies and
operations of the U.S. Government with respect to U.S. relations with the
two Bretton Woods institutions, specifically to make "recommendations"
to the
United States Executive Directors on the two bodies.
  Consultations under Article XII of GATT on discriminatory import restric-
  tions which were to be imposed by the Union of South Africa had loomed
large
  in U.S. initiatives at the third session of the Contracting Parties at
Annecy
  (France) in 1949 (see Foreign Relations, 1949, vol. i, pp. 651 ff.). In
January 1950
  the Union Government introduced the new import regulations in furtherance
  of its restrictive system. In NAC Document No. 965, February 27, 1950 (Lot
File
  60D137, Box 366) the NAC Staff Committee defined the new regulations as
  taking "the following form":
  "'Universal' import permits are issued by the Union for purchase in
any coun-
  try of certain specified classes of 'essential' commodities. Goods purchased
with
  these universal permits will be paid for in gold and hard currencies, and
the
  permits will be issued in approximately the amount of South African gold
and
  hard currency availabilities. However, in addition to these universal permits,
  the Union will issue 'restricted' permits which may be used only for purchases
  of imports from soft currency countries. These restricted permits will
be issued
  in approximately the amount of the Union's soft currency availabilities.
Although
  only fragmentary information has yet been made public, it seems clear that
the
  dual system is designed to provide a net accrual of South African gold
to Great
  Britain."
  4C. Dillon Glendinning, Deputy Director of the Office of International
Finance,
  Department of the Treasury, and Secretary, National Advisory Council.