DEPARTMENT OF STATE
                                                            
 
                                                            
 
               OFFICE OF THE ECONOMIC ADVISER               
 
                         MEMORANDUM                         
 
June 4, 1934.
           Economic Considerations regarding the            
 
  Desirability of entering into Direct Trade Interchanges   
 
       with the German Government at the Present Time       
 
 
(1) The elements of recent German commercial
policy (of which the chief factors have been quotas                                               
often established on arbitrary bases, the creation                                                
of state monopolies for import, treaties giving arbitrary 
and sometimes discriminatory rights to import,
and restrictions on exchanges) have decrived our
most-favored-nation treaty with Germany of effectiveness.                                             
The German Government refused an invitation
extended by this Government some months ago to                                                 
mutually define most-favored-nation rights.                                                          
 
 
(2) In regard to the commodity most often mentioned,                                             
lard, the German Government has (a) created                                                
a monopoly for dealing in all fats, which monopoly                                                
strives to develoo home supolies to the utmost,
regardless off price, and (b) in treaties signed with                                             
other countries has given these other countries                                                   
quotas for lard import more favorable than those                                                  
 
 
allotted