Letter from John W. Dulanty to Joseph P. Walshe (Dublin)
(Secret and Confidential)

At¹ the conclusion last night of the British Government banquet to the Delegates attending the International Convention on Industrial Property Mr. Runciman² and I walked away together.

The moment we were alone the conversation turned on the position of trade as between the two countries when Mr. Runciman deplored the existing state of things. The political side was not his affair but the trade side was, and he felt that the existing policy of drift was unfortunate for both countries. He doubted whether there were any two countries in the world whose general trading operations fitted in so well with each other as Ireland and England. He farms on a very extensive scale in the North of England and is practically acquainted with the livestock position and the consequences for Irish farmers of the present restrictions.

I asked what he thought would be the attitude of his colleagues in the British Cabinet if, leaving the political and financial framework untouched, a suggestion were put forward for a reciprocal trade agreement between the two countries. The British had made agreements with the Russian Government where the relations were not free from political or financial difficulties and they had also made agreements with Denmark - a country closely resembling ours in its export trade relations with England, but very much inferior to our normal position as a buyer on the British market. I said that I was merely thinking aloud; I had obviously no authority to commit my Government but I did not see why he and I should not talk frankly to each other, not as President of the Board of Trade and High Commissioner, but as friends of more than twenty years standing.

He said he would wish for nothing better than to talk on that basis. He asked about the present relationship between the annuity figures and the amounts which the British have collected through the special import duties and I told him that according to Neville Chamberlain's Budget the British for the year 1934 had obtained the equivalent, or possibly rather more than the equivalent, of the annuities through the special duties.

He thought this a most favourable circumstance. He said that he had not made a survey recently of our trading position with them but he would do so and would at the same time examine the Russian and Danish agreements in order to see how far they might serve as models, or suggestions of models, for an agreement with us. So far as he was concerned he would not wish for a moment for any political difficulties to be put in the way, but on that aspect he would naturally have to take his line from the Cabinet. (On this point please see my report of even date giving an account of a conversation with Mr. Grenfell.)³

I repeated that I did not know precisely what line the President would take but I was disposed to think that since the President was completely devoid of any anti-British feeling he would quite probably agree to consider a plan under which the orders which we are sending out from An Saorstát to foreign countries should be given to Great Britain if Great Britain made it worth our while.

Mr. Runciman said that he understood the position perfectly; he would treat the conversation as secret and confidential, but he would be glad if he might be allowed to talk with Mr. Walter Elliot when he returns from his illness to London on Monday next. I said that I had, in fact, on behalf of my Government, been making what were virtually trade agreements with Mr. Elliot, and that he and his Department had said that their experience in these matters wi

This brought us to Mr. Runciman's door where I left him with his under-taking to ring me up at home when he had made his enquiries.