Memorandum by the Assistant Chief of the Division of Trade Agreements (Deimel)

The Czechoslovak Minister, accompanied by Mr. Kabeláč, called today in pursuance of their conversation with Mr. Hawkins on June [Page 42] 15 and the proposed reply which the Minister had drafted to our note of last November regarding our commercial agreement with Czechoslovakia.17

In accordance with the views expressed and concurred in at the meeting of the Czechoslovak country committee on June 30, I told the Minister that we felt that in view of the complexity of the questions concerned in our commercial relations with Czechoslovakia it is essential to keep their different aspects clearly in mind and that we felt his draft note indicated some confusion in this respect. I said that, on the one hand, there were certain matters in regard to which we did not feel that the existing agreement was being carried out in accordance with our views of what it meant and that in this connection we had been making representations through our Legation in Prague and were considering the responses which had been reported to us by our Minister there; that, on the other hand, we had, as the Minister knew, indicated that we were not entirely satisfied with the present short term agreement and had, in our note of last November, set forth some of the considerations, with especial reference to the question of Danubian preference, which we would want to have covered in a more permanent commercial agreement. I pointed out that we were awaiting his Government’s reply.

I added that while we could appreciate the possible difficulties alluded to in his draft note relative to the setting up at this time of a definite and adequate formula to cover the considerations regarding Danubian preference outlined in our note of last November, nevertheless we would necessarily be currently concerned with the existing treatment of our trade and pending the revision of the agreement might have to add to the representations already made regarding the carrying out of the terms of that agreement efforts to seek the adjustment of complaints regarding the treatment of our trade even though these might be covered by the Danubian preference exception under the existing agreement.

The Minister stated that he had been hoping, before leaving his post here, to effect an exchange of notes assuring against unfavorable developments in our commercial relations for some period of time ahead, but that he assumed from my remarks that the important question would be the actual treatment accorded our trade in Czechoslovakia and the responses made by the Czechoslovak Government to our complaints regarding that treatment. I said that while I could, of course, not make any assurances, we naturally were particularly interested in the actual application of fair and equitable treatment to our trade with Czechoslovakia since we must always be able to justify the extension to any country of the benefits proclaimed in connection [Page 43] with trade agreements with other countries, but that we must also not lose sight of the desirability of regularizing our commercial relations on the basis of agreements of long term in order to provide, as. rapidly as practicable, assurances of satisfactory and stable treatment of the trade; while it might not be possible to reach an agreement upon complicated aspects of our commercial relations immediately efforts to develop the terms of a mutually satisfactory agreement through the treatment of individual cases as well as the development of suitable formulae, should continue.

The Minister indicated that he would make clear to his Government the significance of its treatment of our trade to the matter; he also said that as our note of last November remained unanswered; it seemed to him that an acknowledgment by his Government would be desirable and that he would like to bring in very shortly a draft acknowledgement which he might propose to his Government.

  1. Draft note not printed.