The Minister in Rumania (Wilson) to the Secretary of State

No. 1048

Sir: In its despatch No. 1026 of February 21, 1933,41 the Legation reported the difficulties experienced in securing permits for the importation of merchandise from the United States owing to the application of the Rumanian system of import quota. These difficulties have continued to increase until, at the present time, it is almost impossible to secure permits for the import of any American goods. The Commercial Attaché has intervened constantly, but with slight results, with the Minister of Industry and Commerce in behalf of persons wishing to import goods from the United States and, in conversations on this subject which I have had with the King, Mr. Mironescu, the Vice President of the Council of Ministers and Acting Minister for Foreign Affairs, Mr. Madgearu, Minister of Finance, and Mr. Lugoşianu, Minister of Industry and Commerce, and others, I have pointed out that if the present policy of the Rumanian Government continues, it will practically put an end to commercial exchange between Rumania and the United States. As previously reported, this quota system is the pet scheme of Mr. Madgearu, the Minister of Finance, and he is absolutely intransigent in his intention to push it to its extreme limit which, as far as the United States is concerned, makes the import of American goods almost prohibitive owing to the alleged unfavorable trade balance between Rumania and the United States. On the other hand, I know from personal conversations with the King, Mr. Mironescu and Mr. Lugoşianu and, I believe, the Prime Minister, that they are opposed to the quota system but that, owing to Mr. Madgearu’s violent character and his position and following in the National Peasant Party, nobody dares to oppose him openly.

The situation would be bad enough if the quota system were properly applied, but I am convinced that it is applied most arbitrarily and, in my opinion, although it is difficult to secure proof, in a discriminatory manner, especially in so far as the United States is concerned. I am also convinced that permits are granted for pecuniary compensation.

Yesterday, I called on the Under Secretary of State for Foreign Affairs and discussed the question generally as to the effect of the present quota system on American-Rumanian commercial relations. I pointed out that although Rumania and the United States have a commercial agreement providing for reciprocal most-favored-nation treatment,42 nevertheless, [Page 688] American goods were not, owing to the quota system, receiving the same treatment as merchandise from certain other countries. I added that conditions were constantly growing worse and that it was now practically impossible for importers of American goods to secure import permits, so that unless conditions changed it meant almost the closing of the Rumanian market to American products.

As a proof of this, I left with him a memorandum, a copy of which is enclosed herewith,43 showing the fate of six recent applications to import American goods into Rumania. I especially called his attention to the last paragraph of the memorandum where it is stated that in these six cases import permits were requested for over 70,000 kilograms of American goods (this figure was based on the quantities imported in 1931) and that permits have been granted for only 55 kilograms. This treatment, I added, seemed to me to go beyond the requirements of the quota system and to be discriminatory. I further pointed out that the trade balance between Rumania and the United States was not unfavorable to the former country, as certain invisible exports from the United States were not taken into consideration (immigrant remittances, for example, which were $15,000,000 in 1931, and that the very lowest estimate for 1932 must be at least $2,000,000. See the Legation’s despatch No. 995 of December 27, 1932),43 I also referred again to the acknowledged case of discrimination against the American firm of the General Railway Signal Company, for which the promised compensation has not yet been forthcoming, and, in view of the statement contained in the Department’s instruction No. 259 of August 24, 1932,43 I repeated that I felt that the treatment accorded American interests could not fail to cause an unfavorable impression in the Department of State and other departments of the Government.

The Under Secretary of State promised to discuss this question with the Acting Minister for Foreign Affairs and with the Minister of Industry and Commerce, but I do not anticipate any improvement in the treatment of American goods as long as Mr. Madgearu is allowed to continue to impose the quota system.

In view of this situation, and in view of the Department’s strictly confidential instruction No. 289 of March 23, 193343 I venture to inquire whether the Department would consider it advisable, the next time the Rumanian Minister calls at the Department to discuss the American recognition of Russia and the Bessarabian question, to refer to the unfortunate situation arising from the practical exclusion of American goods from the Rumanian market owing to the application of the quota system.

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It further seems to me that this practical exclusion of American goods from the Rumanian market might properly be taken into consideration when the time comes to discuss the question of Rumania’s war debts to the United States.

Respectfully yours,

Charles S. Wilson
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  2. Signed at Bucharest, August 20, 1930, Foreign Relations, 1930, vol. iii, p. 799.
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