611.6531/213: Telegram
The Secretary of State to the Ambassador in Italy (Long)
66. Your 176, April 2, 11 a.m. On Monday the President proclaimed the Belgian trade agreement. At the same time he issued a letter to the Secretary of the Treasury listing the countries to which the benefits arising from the Belgian agreement should be extended.20 The letter recites that the President is authorized to suspend application of duties proclaimed on products of countries which discriminate against the commerce of the United States. He directs that the duties be applied to articles from countries listed in the letter. There are three categories of countries in the second of which Italy falls. With respect to countries in this category provision is made that generalization shall be extended from the date such duties become effective until 30 days from the date on which the Secretary of the Treasury is notified by the President that the United States has ceased to be bound by provisions of a treaty or agreement providing for most-favored-nation treatment in respect of customs.
The Italian Ambassador came in on Tuesday to make inquiry with regard to the exact meaning of this provision. It was explained to [Page 529] him that this meant that in the event of denunciation of the treaty the benefits arising from trade agreements with other countries might not be extended at the end of the period of denunciation provided for in the treaty; that it would be our intention in the event of giving notice of denunciation of a treaty to extend most-favored-nation treatment until the effective date of denunciation as provided for in the treaty, unless discriminations against American commerce become so flagrant as to make it impractical for this Government to continue to accord most-favored-nation treatment to the commerce of such flagrantly discriminating country. The Ambassador was informed that we did not wish to denounce the existing treaty in its entirety, but that Articles 6 and 24 were very much out of date and that we would in a day or so present to him a note suggesting an agreement between the two Governments looking to immediate abrogation of these two articles. We will seek an agreement providing merely for the termination of Articles 6 and 24, and should this agreement not be possible, we may be obliged to give notice of denunciation for the whole treaty in order that we may free ourselves from our present obligation in the face of Italian discriminations against American commerce. We will indicate that we stand ready to enter into an exchange of notes providing for non-discriminatory treatment in respect of customs rates and formalities, exchange, monopolies, quotas and internal taxes.
No mention was made during the conversation with Rosso of the pending trade agreement negotiations, but unless some more plausible basis for going forward than now seems to exist should develop, it seems that it will be necessary to postpone indefinitely the proposed negotiations.
I am not unmindful of your recommendations in this connection, but we feel that it will be better to delay action pending a better clarification of the present position of American exports to Italy.
I might add that I wish you to know how much we appreciate your excellent work on this trade matter, and while we have not found it feasible to go forward with your suggestions at this time, your reports have assisted materially in clarifying the situation before us.
- For text of letter dated April 1, 1935, see Department of State, Press Releases, April 6, 1935, p. 216.↩