[Enclosure]
The American Minister (MacVeagh) to the Greek Minister for Foreign Affairs
(Maximos)
Dear Mr. Maximos: Following our various
conversations on the subject, I have made some further study of
the clearing situation in Greece as it is affecting American
trade, and summarize this here on account of the interest which
you have expressed.
The chief difficulties which American products are encountering
as a result of Greece’s development of barter trade may be
summarized as follows:
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1. Compulsory Barter
for Specific Commodities.
By various decrees the Greek Government has specified
that imports of certain commodities, from whatever
source, will be permitted only if payment is effected by
exports of Greek products. This presents no difficulties
in the case of countries having clearing agreements with
Greece, but it amounts to a virtual embargo upon imports
of those commodities from the United States. The results
are shown in official Greek import statistics for
several items where American products have been
practically driven from the market because of the
difficulty of arranging barter payment for individual
shipments of specialized types of merchandise.
2. Compulsory Barter
for Government Purchases.
In calling for bids on government contracts, Greece now
requires in most cases that payment be effected by
exports of Greek products. This is no handicap to
countries having clearing agreements with Greece, as is
specifically stated in a recent call for bids on
tractors issued by the Ministries of War and
Agriculture. Barter requirements will probably limit the
competition in this case to firms of one country only,
regardless of price and quality, in which American
products may be equal if not superior.
3. Application of the
Import License System.
Certain Greek imports, notably of machinery, require a
special permit from the Ministry of National Economy in
each individual case. In numerous instances importers
state that these permits are refused unless the
machinery is obtained from a country having a clearing
agreement with Greece.
4. Quotas Relaxed for
Certain Countries.
By several decrees, imports of certain commodities in excess of
existing quotas have been permitted where Greece enjoys a
favorable balance under clearing agreements with foreign
countries. Greece also has a favorable balance with the United
States, but importers of American merchandise are unable to
obtain the advantages of these decrees, which serve to increase
purchases from other countries.
As I understand it, the basic purpose of all the foregoing
measures is to encourage importation from countries with which
Greece enjoys a favorable balance of trade. Yet, in 1933, in
commodity trade alone, Greek exports to the United States were
150 million drachmas in excess of imports, while if immigrant
remittances, tourist, expenditures, and other invisible items
are added, the final balance in Greece’s favor probably totals
well in excess of two billion drachmas for the year.
Would it not be wise to encourage imports from America rather
than discourage them, as Greece is doing under the barter
system? I need not stress the advantages inherent in our
depreciated currency, but I can truthfully say that if Greece
would only take a helpful attitude toward our trade with her,
there is practically no limit to the expansion of her possible
trade with us, for the United States is the largest potential
market for Greek products in the world.
Very sincerely yours,
