611.946 Rag Rugs/116: Telegram
The Acting Secretary of State to the Consul General at Shanghai (Gauss)
Please transmit the following to Kobe by mail:
“On December 7, the Department handed to the Japanese Ambassador a memorandum11 substantially as follows:
‘We understand your proposal with respect to exports of cotton rugs from Japan to the United States to be as follows: (1) the maximum amount of chenille rugs for the year beginning June 1, 1935, to be 700,000 square yards; (2) the maximum amount of hit-and-miss rugs for the year beginning June 1, 1935, to be 3,350,000 square yards; (3) the maximum amount of all other cotton rugs for the year beginning June 1, 1935, to be 4,070,000 square yards. We accept this proposal and will not press for any deduction from these figures for the special shipments of Japanese rugs during May 1935 so that we may not complicate the problem by further discussion of the working of the arrangement in the past.
We ask your cooperation, however, to prevent the creation in the future of such problems as a disagreement upon the measure of Japanese exports of cotton rugs or uncertainty as to the adjustment of quotas. Hence it is our suggestion that your Government arrange with the rug exporters’ association for cooperation with the American Consulate at Kobe in a study of the preparation of statistics of such [Page 1041] exports to the United States in order that agreement may be reached upon the basis of classification of these exports and the method of recording these statistics. It is our thought that it should be possible to avoid any discrepancies between the Japanese and the American figures if such an arrangement can be made soon and if, in addition, a representative of the Japanese exporters and a representative of the American Consulate at Kobe can compare their figures at the end of each month.
In view of your assurance that exports of cotton rugs from Japan are now being strictly controlled, it is our expectation that cooperation along the lines suggested above will in the future prevent any considerable discrepancy between the statistics compiled by the Japanese exporters and those recorded by the American Consulate at Kobe. If there should recur important differences in these figures we would desire to reopen the question of the proper measurement of rug shipments.’
On December 21, the Japanese Embassy informed the Department that the Japanese exporters’ association was ready to cooperate with the American Consulate at Kobe in order that a study might be made toward the preparation of statistics of cotton rug exports to the United States, and that this cooperation would be retroactive to the first of June 1935. The Embassy stated ‘According to our experience heretofore, the cotton rugs without certification of the Exporters Association were exported to the United States with the certification of the American Consulate. As a result the figures of the American Customs would show this amount while the figures of the Japanese Exporters Association would not, thereby causing a discrepancy in figures between the two countries. In such a case the Exporters Association was not in a position to control this.’
The Department desires that in accordance with the foregoing you confer with representatives of the exporters’ association for the purpose of (a) preparing statistics of exports to the United States of the three above-mentioned categories of cotton rugs from June 1, 1935, to the present; (b) preparing such statistics monthly hereafter; (c) arriving at some method of measuring the discrepancy between the Consulate’s figures and those of the association arising out of the fact that not all Japanese exporters belong to the association, and of offering suggestions as to how this discrepancy might be removed.
Dr. Frank A. Waring and Dr. Ben Dorfman, economists of the Tariff Commission, who are now in the Philippines, will be requested to confer with you en route to the United States, probably in January, with a view to working out the problems involved in the preparation of these statistics.
Your reports prepared in compliance with this instruction should be mailed to Shanghai for transmission by naval radio.
Please send copy of this instruction to the Consulate General at [Page 1042] Tokyo with request that the Consulates at Yokohama, Nagoya, and Nagasaki be notified for the purpose of obtaining effective cooperation.”
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