It could, however, not be denied, that the trade situation between Denmark and the United States was unsatisfactory, partly because of the fact that the United States exported many times more to Denmark than Denmark exported to the United States, partly because the small and still decreasing exportation from Denmark to the United States must in no small degree be ascribed to the high tariff rates and the tariff laws of the United States.

If these rates and tariff laws were to be further increased and made harder to comply with or more stringent in their application to Danish products, it was to be feared that considerable losses of trade would be the result for Danish producers and exporters.

The Danish Ministry of Foreign Affairs therefore undertook a study of the trade situation between Denmark and the United States since the World War and especially since the year 1922, and I have been directed to submit the result to you in the document (memorandum) here inclosed in translation in three copies.

I venture to hope that you can see your way to transmit copies thereof, and of my present note if you deem proper, to the appropriate committees of the Senate and of the House of Representatives of the United States, and that it may be helpful in arriving at a fuller insight into the commercial relations between our two countries and to a definition of the point beyond which an increase of tariff duties would either prevent or so seriously hamper as to reduce to a negligible minimum the exportation from Denmark to the United States.

In this respect I beg leave to point out that the exclusion or reduction to a minimum of our export to the United States would make it a very serious problem for us how to pay for our large importations from the United States, and that these in all likelihood would have to be curtailed, perhaps considerably.

The inclosed document (Memorandum) was prepared before the actual rates and the text of the new tariff bill were known, and I, therefore, beg to reserve to my Government the opportunity to submit to you supplementary observations on the probable effect of the actually proposed rates or rules on the trade between Denmark and the United States.

It may already now be observed that a duty of 8 cents per 100 pounds is proposed on cement, which until now has been free of duty, and that it has been reported to me that the comparatively small importation of cement from Denmark to the United States would have to cease if cement were placed on the dutiable list. It may also be observed that the duties have been considerably increased on our china (porcelain), cheese, and seeds and on Iceland wool.

It may further be observed that if a more frequent or wider application of American values instead of the foreign value or the export value should result from the new text in section 402 of the tariff bill, or from the provisions in section 642 of the tariff bill, relative to investigation of methods of valuation, it is feared in Denmark that this would have for effect to considerably increase all the ad valorem duties and still more accentuate the now existing unfavorable situation as to the exportation of Denmark to the United States compared with the exportation of the United States to Denmark.

It is also in our opinion to be feared that such application of American values as a basis for the assessment of duty would create the

greatest difficulties for our exporters, rendering it practically impossible for them to make reliable calculations.

As of further assistance in the investigation which it is hoped will be made, I beg to inclose in translation three copies of the statistics of import and export between Denmark and the United States for the years 1913-1928, received from the Danish Government. I have the honor to be, sir, with the highest consideration,

Your most obedient and humble servant,

MEMORANDUM

C. BRUN.

The trade between Denmark and the United States is overwhelmingly in favor of the United States, which clearly appears from the following summary:

In 1928 the value of the importation into Denmark from the United States was therefore about twenty-three times larger than the value of the exportation from Denmark to the United States.

The Danish Government appreciates the fact, that this great difference is due in a large measure to natural economic conditions, but is on the other hand bound to realize, that the unfavorable conditions of importation, with which Danish commodities are met in the United States in regard to customs duties and customs laws, are in no small degree responsible for the markedly small sale of Danish products in the States. The difference in importation and exportation between Denmark and the United States has furthermore increased in a very marked degree since the years before the World War. This will appear from the fact that the value the exportation from Denmark to the United States in 1927 amounted to 0.6 per cent of the total exportation from Denmark against 1.1 per cent in 1913, while the value of the importation to Denmark from the United States in 1927 amounted to 15.6 per cent of the total importation of Denmark against only 8.1 per cent in 1913.

With regard to the tariff duties in the United States, as applied to Danish commodities, the duty on butter may be mentioned in the first place. The duty on this product was pursuant to the Tariff Act of 1913 21⁄2 cents per pound; it was increased to 6 cents in 1921, to 8 cents in 1922 and finally further increased to 12 cents in 1926, a rate which may be called exceedingly high considering that butter is so eminently an article of necessity.

The last increase took, as is well known, place after investigation by the Tariff Commission of the difference in the costs of production in Denmark and in the United States, an investigation against the methods and results of which the Danish Government made at the time a well founded protest.

It is very clear that the persistent increase of the tariff duty has contributed in a marked degree to the very great decrease in the exportation of butter from Denmark to the United States during later years (1920-1927).

Another Danish product, which has been affected by the American increases of customs duties and for which the present duty is very high, is cheese.

Pursuant to the tariff act of 1913 the duty was 20 per cent ad valorem, which in 1921 was increased to 23 per cent and in 1922 to a minimum of 25 per cent, and finally in 1927 the duty on Swiss cheese and Emmenthaler cheese was increased to a minimum of 371⁄2 per cent ad valorem.

Furthermore, such commodities as potatoes and seeds have been the subject of tariff increases which have affected the sale thereof adversely. Exportation of potatoes will under normal condition for this reason be out of the question.

With regard to a number of special products (porcelain, China, biscuit, silverware, boat motors, cream separators), it may be said that the high tariff duties tend to prevent an expansion of the export trade in these articles. The exportation of these articles to the United States is now of very modest proportions in spite of their recognized very high standard.

The Danish exportation to the United States as a whole, as explained above, is of comparatively very small value and yet is constantly decreasing, and this situation, combined with the difficult conditions for importation into the United States, forms a very striking contrast to the very great value of the importations to Denmark from the States and to the liberal conditions under which this importation into Denmark takes place.

It is easy to understand that this difference has attracted wide attention in Denmark, especially though not exclusively in the agricultural world, and has caused proposals having for purpose a change of the situation.

A further examination of the American importation into Denmark and of the tariff provisions applied to this importation will help to understand the feeling created in Denmark.

In 1927 Denmark imported from the United States commodities to a value of 251,000,000 kroner. This amount is between 1 and 2 per cent of the total exportation of the United States and, in view of the area of Denmark and its number of inhabitants compared with the world market as a whole, it will be seen that the United States has only reason for the greatest satisfaction with the situation. It has already been mentioned that the importation from the States amounts to 15.6 per cent of the total importation into Denmark. With regard to several products the Danish market is even of paramount importance to the United States. Thus Denmark in 1927 purchased respectively about 80 per cent and about 70 per cent of the total export from the United States of cottonseed cakes and other oil cakes. Denmark takes a considerable part of the total export of the United States of such products as oleo stock, oil-cake meal, desiccated apricots, alfalfa (American luzerne), and oil seeds. For products like corn, corn grit, flour of wheat, fresh and desiccated apples, prunes, nuts, sirup, timothy and other grass seeds, binder twine, agricultural machinery, automobiles, and raw phosphate the Danish market is of importance.

A considerable part of this importation is free of duty. This is for instance the case with regard to such important commodities as grain and feedstuffs, cotton and petroleum. The duty when imposed does only in a few instances reach or exceed 10 per cent ad valorem.

As already pointed out above it is especially in agricultural circles that dissatisfaction has arisen as a consequence of the existing abnormally uneven proportion as between importation and exportation. This must in the first place be ascribed to the fact that the agricultural products are the principal articles affected by the increased tariff rates in the United States. But the sharpness of the dissatisfaction is also in some measure due the very remarkable circumstance, that it is precisely the Danish agricultural industry which takes the main part of the exportation of feedstuffs from the United States and that these feedstuffs are admitted into Denmark free of duty.

If it is now intended to adopt increases of the tariff duties which will make still more difficult the export to the United States from Denmark that is yet possible in spite of the tariff increases of later years, it should not be overlooked that the result will be increased dissatisfaction and an increased tendency to try to reduce the importation from the United States. The justification of the considerations, which are the foundation for this tendency, may not be lightly dismissed, and the consequences thereof may not be belittled. It may not be deemed impossible that these considerations may sensibly influence the sale of American products in Denmark, especially feedstuffs.

In these circumstances the Danish Government ventures to hope, that the American Government will endeavor to prevent such tariff increases, which would reduce the possibility of continuing the sale of Danish products in the United States. This applies in the first place to butter, cheese and seeds, but also to hides, skins, and cement, which last named products until now have been free of duty.

Exports of domestic articles from Denmark to United States

[Value in 1,000 kroner. The figures for 1928 include both domestic and foreign articles]

Exports of the most important domestic articles from Denmark to the United States

Hon. REED SMOOT,

81, 469 37, 437 12, 480 7,439 8,857 6,457

DOMINICAN REPUBLIC

DEPARTMENT OF STATE,
Washington, June 19, 1929.

Chairman Finance Committee, United States Senate.

SIR: Pursuant to your request that you be furnished by this department with copies of all representations made by foreign governments to this Government touching tariff questions, I have the honor to inclose for your information copy of a note, in translation, received from the Dominican Minister, dated April 15, 1929, concerning the possible revision of the United States Customs Tariff.

I have the honor to be, sir,

Your obedient servant,

[Translation]

J. REUBEN CLARK, Jr.,
Acting Secretary of State.

Washington, April 15, 1929.

LEGATION OF THE DOMINICAN REPUBLIC,

His Excellency HENRY L. STIMSON,

Secretary of State, Washington, D. C.

Mr. SECRETARY OF STATE: The present condition of the commercial relations between the Dominican Republic and the United States causes the possible revision of the customs tariffs by the Congress, which is assembling in extraordinary session on this day, to be regarded in my country with excusable anxiety.

The statistics of recent years show that the United States holds in our foreign trade the position of first seller, as it furnishes at least 60 per cent of the aggregate value of our imports while, as a purchaser, it only buys 25 or at most 30 per cent of our exports.