The Secretary of State to the Ambassador in Spain ( Bowers )
15. Since Foreign Office stated early in January24 they would require 10 days or 2 weeks to consider question of settlement of claims in exchange for recognition of Spanish Zone, it is suggested, within your discretion, that you sound Spanish out regarding their willingness to reach an agreement along lines outlined as points (1), (2) and (3) of formula in your 6, January 14, 3 p.m. Department assumes that (1) comprises claims amounting to 207,039.85 pesetas as indicated in second paragraph of Department’s 7, January 29, 7 p.m.
While the Department has assumed that reference to claims being settled means actual payment of claims prior to recognition, rather than delay agreement we would not insist, provided the Spanish agree in an exchange of notes to specify a specific and reasonable time in which payment would be made. We would also be willing to have [Page 1013] Kettani claim settled subsequently by negotiation between Blake and the High Commissioner.
The Department reiterates its desire to have claims settled without any conditions other than that the United States shall formally recognize the Spanish Protectorate.
In view of rumors, confirmed by Johnson, who is here this week, that Spanish are reluctant to go along with the French in the proposed change of the customs regime, it is suggested, within your discretion, that you point out again to the Foreign Ministry orally that this Government is opposed to the French proposal since the project as we interpret it, involving a system of quotas which are inherently discriminatory, and a unilateral balancing of trade, is out of harmony (1) with the principle of commercial equality as guaranteed to the Powers in the Act of Algeciras,25 and by the French in various treaties which constitute the basis of the French Administration in Morocco, as cited in paragraphs 4 and 5 of the Department’s 669 of December 18,26 and (2) with our general policy to encourage the fullest volume of mutually profitable commerce throughout the world by the removal of trade barriers.
Please keep Department informed by cable.