BARRIERS TO INTRA-EUROPEAN TRADE
THE OEEC payments agreements aimed at increasing intra- European trade primarily by creating the means of paying for it. This was a logical first step. With equal logic it had to be followed closely by measures to remove other barriers to trade. The following chapters, therefore, tell what the OEEC countries have done about quantitative trade restrictions, tariffs, cartels, and some other barriers to intra-European trade.
Payments difficulties accounted for many of the restrictions on intra-European trade. Governments short of foreign exchange used exchange controls, quotas and import licenses to hold imports down to the amounts officials thought their countries could afford.1 Since at any given moment a country might have larger supplies of one foreign currency than another, import controls were made discriminatory as well as restrictive. National authorities holding a plentiful supply of Country A's currency would permit importers to buy its products but would forbid them to buy the same products from Countries B, C, and D, whose currencies were scarcer. A bilateral agreement might oblige a country to import from a certain trade partner practically all it needed of a particular commodity, thereby leading it to ban imports from other potential suppliers. This type of discrimination obviously had its uses as a bargaining weapon and was virtually essential in carrying out bilateral trade policies.
Not only the source of imports but their composition was____________________