Foreign Relations of the United States, 1951, European Security and the German Question, Volume III, Part 2

762A.00/7–1751: Telegram

The Director of the Berlin Element (Page) to the Liaison and Political Reporting Division, at Bonn¹

secret   priority

Berlin, July 17, 1951—9 p. m.

30. For Slater. 1. CDTs met today with key Ger reps (Senate, Reuter and Eich; FedRep Vockel and Kaumann; Labor, Scharnowski, and industry, Spennrath). Gen Bourne as chairman CDT made introductory statement covering fol points:

(a) History of Warenhegleitscheine issue.

Resume of Allied case concerning Sov requirement for certificates of origin. Despite correspondence with Dengin and quadripartite talks at technical level on illegal trade, Sovs have shown no disposition to normalize Warenhegleitscheine handling.

(b) Countermeasures.

CDT’s recommended to HICOM imposition of countermeasures. In addition to refusing to sign IZT agmt, of which Gers are informed, Allies have plan for embargoing shipments to East of comprehensive list of hard goods of high value particularly needed by East Zone to fulfill five year plan.

(c) Publicity.

In recognition need for strong support West Berliners and West Gers, Allies are preparing suitable info for press background which, after coordination with West and approval by HICOM will be given to Gers or simultaneous use by FedRep and Senate shortly after countermeasures instituted.

(d) Stockpile.

Present stocks must not be permitted to drop beneath present levels by even one day’s supply.

(e) Controlling certificates of origin.

Recalled instructions to Mayor that certificates of origin were not to be submitted to East auths.

Pointed out that even small firms must comply with this order.

(f) Assistance to Berlin economy.

Requested Gers for accurate info concerning sitn faced by business community and firms requiring immed assistance.

2. After consulting among themselves privately, Reuter replied for Ger group, but stated he spoke solely as Mayor of Berlin and not representative of FedRep as well.

(a) Sitn was regraded as extremely grave. Although some weeks ago Gers were reticent, they now fully support Allied position. In event of open trade war, prestige of entire Western World wld again be at stake in Berlin and therefore everything must be done to support Berlin economy and morale. Although this wld come as severe shock to Berliners, they will understand issue, particularly if complete freedom for movement West Berlin goods can be foreseen as result. (Scharnowski made heartening statement that with increased unemployment under these circumstances, workers’ morale can be maintained since issue directly concerns their freedom and more wld be lost than gained by weak stand).

(b) Gers not in position to gauge effectiveness or outcome of Allied countermeasures without detailed examination, but did not want this statement interpreted as taking position against countermeasures. Allied countermeasures may result in Sov retaliation. However, if yield to Sovs this wld lead to certain control of West Berlin trade, without guarantees for normal handling Warenbegleitscheine, Gers wld be at mercy of Sovs. With possible consequences of countermeasures in mind, conclusion arrived at that we must not give in.

(c) No comments as to publicity.

(d) Assured CDT’s Senate wld do all it cld to maintain stockpiles, assuming continuance of imports to Berlin without new interference.

(e) Additional administrative measures will effectively prevent firms from submitting certificates of origin to East auths, altho no assurance practice can be completely stopped. No further legis is believed necessary.

(f) Difficult to foresee consequences present sitn on business community 60 to 70 million DM worth of goods totaling between 10 to 12 thousand tons waiting transport from Berlin. Only remedy is to provide transport without Sov control, otherwise firms face bankruptcy and increasing unemployment. West Berlin is unable to solve this problem by itself and it is doubted if FedRep will provide effective measures. Allied–Ger Berlin comite was proposed to deal with problem of assisting Berlin firms. Senator Eich added that financial assistance is immed necessary as some firms are not in position to meet wage and social security payments.

3. Reuter stated he is obliged to inform Senate, Berlin political party leaders and FedRep of sitn. Vockel will inform FedRep officials tomorrow in Bonn. Gers agreed to hold info in strict confidence until authorized otherwise by CDT’s. Reuter expressed hope that he cld be in position to make public statement at next regular mtg of House of Reps, scheduled for 19 July.

4. Our mtg with Gers today shows that we have full support of principal Ger leadership. Furthermore, they expressed conviction that the Berliners themselves will not be found wanting, especially if tangible Allied support becomes evident.

Page ;

1. Repeated to Washington, Frankfurt, London, Paris, and Moscow. The source text is the copy in the Department of State files.