The Secretary of State to the Minister Resident in Iraq (Knabenshue)
Sir: The receipt is acknowledged of your despatch No. 591 of February 20, 1936,7 transmitting a copy of a note dated February 12, 1936, from the Iraqi Foreign Office containing its observations on the draft treaty of general relations submitted by this Government.
The Department is prepared to negotiate three separate treaties with reference to commerce and navigation, general relations (residence and establishment), and naturalization, respectively. It believes that a treaty of commerce and navigation is most important at this time, and accordingly desires to begin negotiations looking toward the conclusion of such a treaty first.
It is noted that on pages 5 and 6 of the memorandum of your interview with the Director General of the Foreign Office on July 15, 1935,7 you express doubt as to the advisability of proposing negotiations for a commercial treaty owing to the fact that the Iraqi Government is considering the adoption of a new trade policy. An examination of the possible objections of the Iraqi Government reported in your later despatch under reference, leads to the conclusion that the objections are specific in nature and not general.
You are requested to ascertain whether a proposal for the negotiation of a commercial treaty would meet with the concurrence of the Iraqi Government. Negotiations for a treaty of residence and establishment could follow, and the naturalization treaty would be last in order.
For your information the Department desires to point out that in the negotiation of a commercial treaty it must insist upon the inclusion of an article providing for unconditional most-favored-nation treatment, a principle to which this Government is firmly committed. To conclude a commercial treaty without the unconditional most-favored-nation clause would not only be futile but even prejudicial to American interests.
Very truly yours,