The Acting Secretary of State to the Ambassador in Italy ( Phillips )
132. Your 401, October 5, 4  p.m. This Government is gratified to hear of the abolition of the ad valorem tax on imports of September 24, 1931, the authorization for the Chief of the Government to revise import duties, the authorization for the Undersecretary for Foreign Trade and Exchange to vary the volume of import quotas and to abolish the system of private clearing, and the authorization to the Chief of the Government and the Minister of Finance to suspend all or part of the existing restrictions on movement of capital and foreign trade. It regards these measures as an important step toward the restoration of normal, mutually profitable trade between this country and Italy.[Page 351]
The policy of this Government naturally continues to be to seek the reduction of excessive trade barriers under the most-favored-nation principle rather than to seek special favors at the expense of other countries. You should utilize every appropriate occasion to emphasize to the appropriate officials of the Italian Government the importance which we attach to the restoration of international trade through the progressive relaxation and abolition of quotas and exchange controls as a necessary concomitant to stability in international exchange and as essential to that real prosperity upon which peace depends.
It is noted that the measures referred to above are highly elastic and allow great discretionary power to certain branches of the Italian Government. Therefore, the Department desires that you follow the application of those measures closely and that you exert every effort to ensure that American trade receives its fair share of the advantages resulting from them.