611.6531/94
Memorandum by the Chief of the Division of Western European Affairs (Moffat)
Mr. Sayre3 today asked the Italian Ambassador4 to call, and, together with Mr. Moffat, received him this afternoon at 4 o’clock.
Mr. Sayre told the Ambassador that, if agreeable to the Italian Government, we are prepared to enter upon reciprocal tariff negotiations with Italy within the near future. In fact, we have suggested giving public notice of intention in the press appearing in Washington, Monday evening, September 24, and in Rome at the corresponding hour. Announcement would be made at the same time for the benefit of American interests concerned that the Committee for Reciprocity Information had prescribed that all information and views in writing and all applications for supplemental oral presentation of views should be submitted to the Chairman not later than November 12; [Page 586] oral presentation of views by persons whose applications therefor had been approved would be heard November 19.
Without asking Italy to bind herself by a formal written undertaking, we nevertheless asked the Ambassador to assure us that the Italian Government during the course of our negotiations would not prejudice American trade by taking further measures of restraint, particularly any of a discriminatory character. It could only be in an atmosphere that was not marked by such complications that we could hope to achieve a successful conclusion. If Italy were about to embark on a program that would embarrass our trade, it might be better not to start negotiations.
Rosso replied that he had talked over the whole question when he was in Italy and found that the Italian Government thought our tariff negotiations policy was a move in the right direction and he felt certain that our invitation would be accepted shortly. On the other hand, he felt that we should have a true picture of the situation in Italy as he saw it. Italy’s main preoccupation today was to keep the lire at its present level, partly because Italy is a large purchaser of raw materials and partly because of its social and psychological importance throughout the country itself. To do this was requiring a great effort and more and more Italy, under the influence of Finance Minister Jung, was turning in the direction of barter agreements and bilateral balancing of payments. He said that Jung recognized that this was a step in the wrong direction but hoped that it might be only temporary to meet the present crisis. The Ambassador said that as he saw the picture, the purpose of the negotiations was mutually to stimulate trade between the two countries in certain products by lowering their respective duties and he saw no inconsistency between this and the policy at present being put into effect by Finance Minister Jung (N.B.: It will obviously be necessary to watch with especial care the effect of Italy’s currency restrictions on imports, so that logical increases in purchases from the United States due to tariff concessions will not be evaded. P.M.) The Ambassador said that he would telegraph to Italy, explaining our point of view and requesting an answer if possible by Friday.