611.6231/587

Memorandum by the Chief of the Division of Western European Affairs (Moffat)

By reference from the Secretary, the German Ambassador (accompanied by Dr. Lohmann) called this afternoon on Mr. Sayre.6 (Mr. Grady and Mr. Moffat were also present).

The Ambassador said that with our announcement regarding the generalization to other countries of the concessions granted Belgium and with the public release entitled “Policy of the United States concerning the Generalization of Tariff Concessions under Trade Agreements”,7 we had reached a new mile-stone in our trade program. He recalled that for more than a year Germany had been pressing for the negotiation of a trade agreement but that we had not thus far been receptive. The Ambassador noted that concessions to Germany would only be granted until the termination of our commercial treaty next October;8 in our statement, however, the hope was expressed that agreements would be reached with Germany and countries in a similar position before the existing most-favored-nation treaties or agreements expired, in order that it might not be necessary to withdraw our minimum rates from any of the relatively few countries in this group.

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The Ambassador said that he regarded this more or less as an invitation and came to inquire more specifically what we proposed. From his point of view the essential was not what would be written into the treaty but that negotiations should be started as only six months remained for their completion. He felt that it would be exceedingly important to have experts sent over here from Berlin but that the main thing was to institute negotiations without delay.

Mr. Sayre did not see the problem in quite so simple a light. He reviewed our trade policy pointing out that if Germany would accept our thesis of equality of treatment and most favored nation, we could conclude some sort of an agreement overnight. He doubted, however, whether Germany was as yet ready to reverse her entire trade policy to this point and in the circumstances it required considerable study to see whether a possibility existed for useful negotiation. The Ambassador reiterated that Germany had given equality of treatment to the United States as far as she had been permitted to do so by other countries; that we must not lose sight of the fact that since the War she had bought eight billion dollars worth more in this country than she had sold; that as far as meeting her debts, she had spent all the gold in her possession down to thirty million dollars worth, et cetera, et cetera. Such being the case, he implied that we should view the German problem on the basis of facts and not on the basis of a rigid question of principle.

Mr. Sayre replied that he and his associates would study the problem anew, would discuss it with the Trade Agreements Section and would confer with the Ambassador again at a later date.

Pierrepont Moffat
  1. Francis B. Sayre, Assistant Secretary of State.
  2. Vol. i, p. 536.
  3. Treaty signed December 8, 1923, Foreign Relations, 1923, vol. ii, p. 29. For denunciation of this treaty by Germany, see ibid., 1934, vol. ii, p. 453.