Memorandum by the Secretary of State

The Minister of Yugoslavia came in to say goodbye before sailing for home for the summer. He undertook to explain the recent embargo measures of his Government calculated to affect some of our [Page 819] American exports.6 He then suggested consideration of a trade agreement between the two countries.

I repeated with emphasis the economic program of this Government and pointed out that it was much broader in its objectives than mere dollars and cents which might be derived from bilateral bargaining or bartering; that it contemplated the normal restoration of international trade and the consequent removal of a large range of both economic and political difficulties and controversies. I then added that I did hope his Government might see its way clear to proclaim the same ultimate economic objectives and to emphasize them from week to week and month to month in the most public manner; that his Government in that way could be very helpful to the advancement of our trade agreements program; that the nations would go backward, instead of forward, under the existing policy of bilateralism so prevalent in Europe; and that I earnestly trusted his Government might see its way clear to face forward economically, instead of backward by imposing embargoes in a discriminatory manner. I further stated that we had the highest opinion of the people of his country and were very desirous of improving and expanding our trade relations in every way mutually desirable and profitable; and that to this end we were giving due attention to all of the fundamentals and the details of the situation.

The Minister indicated as he left that he would go back and very earnestly preach the fundamentals of our economic program and its objectives to the appropriate officials of his Government.

I finally emphasized to him that Europe with its civilization was not making progress under the existing narrow, trouble-breeding, economic policies; that it was moving noticeably in the wrong direction; and that I felt the adoption of some such economic policy as this Government was advancing would be the largest single factor for restoration of sane economic conditions in Europe, as well as in other parts of the world.

C[ordell] H[ull]
  1. The American Consul in Belgrade, Robert B. Macatee, submitted a report on July 3, which analyzed the presumed consequences to American trade of the Yugoslav import control measures of June 25, establishing financial quotas on imports from countries with which Yugoslavia had no clearing agreements. The restrictions would affect the total of American trade less than might have been expected at first glance, because approximately 90 percent of American exports were not included in the list of 33 articles subject to the new controls. Among the imports of American goods which might be most interfered with, automobiles and radios constituted the most important items. (660h.006/12)