611.5831/130

Memorandum by the Assistant Secretary of State (Sayre)

The Swedish Minister called to see me this morning in order to discuss the contemplated trade agreement between the United States [Page 720]and Sweden. He said that he found, when he reached Sweden during the past summer, that almost nothing had been done about the matter and he spent much of his time while there at the Foreign Office working on the matter. He said that he had received a cable three days ago appointing him to act as the negotiator, and that he was expecting a despatch sometime next week giving his Government’s reply to the memorandum which we submitted to Sweden last winter.

He went on to say that Sweden was at present such a low tariff country that he did not see how Sweden could offer much to the United States in the way of reductions in tariff. He said that Sweden was an ardent advocate for liberalized trade but is being so hard pressed now by countries like Germany and Great Britain that his Government is having a very difficult time to maintain its present low trade policies. For these reasons, he said that he feared it would not be possible for his Government to grant much in the way of tariff reductions but that, in view of the pressure to which his Government is subjected by existing economic conditions, he felt that it would be a large concession in itself if Sweden should guarantee to American trade the continuance of existing arrangements, including the existing free entry and low tariff rates charged against American goods.

I replied to the Minister that the United States was primarily interested not in petty bilateral bargaining in an effort to out-trade competitive rivals but rather in the general liberalization of world trade; and I felt sure that with two countries both anxious to reduce existing barriers we could find a way for bringing into force a mutually advantageous trade agreement. I suggested that only through increasing existing trade could relief be found for the pressing financial problems which at present exist.

. . . . . . . . . . . . . .

The Minister welcomed this expression of views and promised to return, probably next week, with a communication from his Government in reply to our memorandum of last winter.

F[rancis] B. S[ayre]