611.5231/964
Memorandum of a Conversation Between the Assistant Chief of the Division of Western European Affairs (Hickerson) and the Counselor of the Spanish Embassy (Yrujo)
Mr. Yrujo came in to see Mr. Hickerson today to learn whether or not it had been possible for us to work out in the case of a list of five items which he had submitted to us on March 1, more precise definitions or classifications in such a way as to make it possible for Spain to grant reductions to the United States with regard to these items without giving away bargaining power to other countries. Mr. Hickerson informed him that it seemed probable that satisfactory definitions could be worked out in some cases and perhaps in all but that in order to expedite the course of the negotiations we did not desire to take up the question of the classification of these five items until the Spanish and American negotiators had had an opportunity to go over together the Spanish and the American lists of desiderata in their entirety. Mr. Yrujo regretted that we could not give him at this time new definitions of the items contained in his list of March 1 and stated that he would inform his Ambassador that we had politely refused to comply with his request. Mr. Hickerson immediately pointed out to Mr. Yrujo that such an interpretation of his remarks would be mistaken, that we were not unwilling to comply with the Spanish request for more precise definitions but, on the contrary, were anxious to submit the entire list to an examination with a view to more precise definition wherever it seemed necessary. Our objections were not to making more precise definitions but to devoting too much time at this point in the negotiations to items of minor importance. It was pointed out to Mr. Yrujo that certain of the items contained in his list were of comparatively small importance while, on the other hand, certain items which did not appear on his list were of the greatest importance to us. We believed it more desirable, therefore, to take up with the Ambassador the complete lists of desiderata, than to begin with a few items chosen without relation to their importance.
Mr. Yrujo replied that he believed that both sides already knew fairly well which were the important items on each other’s lists, and that as the only way in which Spain could grant reductions below its second column was by creating what amounted to new items he had hoped to be able to take up the simpler items first. When Mr. Hickerson pointed out to him that Spain appeared recently to have granted the Netherlands reductions below the second column rates Mr. Yrujo stated that the Spanish view of the matter was that a new [Page 701] classification with a special rate had been set up for certain specific Netherland products and there had been no reduction in the rate for the classification under which these Netherland products had previously entered Spain. It was pointed out to Mr. Yrujo that if this policy was to apply in the negotiations with the United States there was all the more reason why the entire list should be taken up at one time. Mr. Yrujo replied that he had no authority to make any decisions but that he would inform the Ambassador that we were anxious to begin consideration of the entire list rather than a few individual items.
Mr. Hickerson took advantage of the occasion to remind Mr. Yrujo that on January 22 he had supplied us with a more detailed indication of a number of the items on which Spain desired duty reductions but had informed us that he would be unable to state definitely the Spanish desires with regard to certain items until information which had been requested from Madrid had been received. Mr. Yrujo stated that he believed that this information had not yet been received.
Mr. Hickerson also informed Mr. Yrujo that we had heard rumors that it was the intention of the Spanish Government to place a quota on the importation of automobiles based on imports during the year 1934. Mr. Yrujo said that he had seen reports to this effect in the newspaper La Prensa, published in New York, but that the Embassy had received no official information. Mr. Hickerson pointed out to Mr. Yrujo that if Spain placed in effect a quota based on imports in any period subsequent to the imposition of prohibitory duties in November 1931 it would be unfair and unjust to the United States and that to freeze by a quota the situation brought about by the duties of 1931 would render practically impossible the conclusion of a really satisfactory trade agreement since prior to the adoption of the discriminatory tariff rates automobiles had constituted our most important import into Spain except cotton, and one of the principal aims of our present negotiations was to remove the obstacles which at present prevented us from getting our fair share of the market for motor vehicles.