136. Memorandum From the President’s Special Assistant (Rostow) to President Johnson1
SUBJECT
- U.S.-Italian Civil Aviation
When President Saragat visited you he raised the issue of U.S.-Italian civil aviation relations. He said that the former U.S.-Italian Civil Aviation Agreement, which Italy renounced, gave Italy less generous terms than the agreements we had with Germany, France and the UK and suggested its terms were related to the World War II armistice settlement. He said that this issue was of considerable psychological importance to Italy and you assured him that you would have the problem carefully reviewed.
[Page 284]At Tab A is a letter from Secretary Rusk to Foreign Minister Fanfani2 transmitting on your behalf our comments on President Saragat’s remarks. Secretary Rusk has approved the letter.
The Rusk letter makes the following points:
- —the former agreement was not related to the armistice settlement;
- —it provided U.S. and Italian carriers approximately equal revenue opportunities. On this criterion, which is fundamental to all our aviation negotiations, it was equal to our agreements with other countries, including Germany, France and the UK;
- —the U.S. is prepared to grant Italy new commercial air rights as valuable as those it would obtain from Italy in exchange. We made a valuable new offer in our most recent negotiations because we very much wanted to settle this issue. We continue to be willing to consider other alternatives consistent with the principle of obtaining overall economic balance;
- —we want to get an exchange of views going again so that we can settle this issue.
The letter closes the door on any further review by yourself. State believes, and I think it is probably right, that unless we do this we will not be able to get the Italians back to the table to negotiate a fair commercial bargain.