800.51W89 U.S.S.R./168: Telegram

The Ambassador in France (Straus) to the Secretary of State

87. Department’s circular January 31, 7 p.m. Marchandeau, Minister of Commerce, lunched at the Embassy today and I discussed with him the breakdown of commercial negotiations with the Soviet Government reading to him the text of the statement given out in Washington.

He said that the American offer appeared to him more favorable than anything the French were prepared to offer at this time particularly with respect to a revolving fund for credit and that he was sure that the negotiations had broken down on the question of any recognition of debts no matter what their origin. He said that the Soviet authorities had naturally endeavored to play France off against the American group and vice versa in the matter of these negotiations and that he was very pleased to have the definite information of our positive attitude.