640.0031 Danube/72

Memorandum by the Secretary of State of a Conversation With the Austrian Minister (Prochnik)

The Austrian Minister came to ask about our attitude regarding the Danubian Union. He asked me pointedly whether we would raise our most-favored-nation treaties. I told the Minister no, provided that the five Danubian countries treated all outside countries alike. He asked me whether our Government took more than a platonic interest in it and I said that, if that meant we would assist them financially, I was afraid we would not as it was contrary to our policy. As to our bankers’ position, I could not say except that it was very hard to make a loan anywhere now. In reply to the Minister’s inquiries, I told him, in general, that we regarded the move sympathetically as one which was sound, economical and designed to help out those countries. The Minister told me that their proposal for a reciprocal concession of only ten per cent was probably not large enough to offset the competition of the powerful industries in the larger nations outside, and I told him I thought that was true; that they would have to make larger concessions than that in order to be of real value it seemed to me.

H[enry] L. S[timson]