The Secretary of State to the Minister in Nicaragua (Lane)

No. 407

Sir: The Department is giving consideration to the possibility of making a matter of record in some way, in connection with the proposed trade agreement with Nicaragua, the concessions which the latter will enjoy by virtue of generalization of concessions made by the United States in other trade agreements but which cannot for reasons of policy be included in Schedule II of the agreement. For your information, a product cannot ordinarily be considered for inclusion in Schedule II unless the country concerned is the chief or an important supplier of the product to the United States. In cases where a commitment on an article has already been made by this [Page 803] Government in another agreement, such commitment cannot ordinarily be written into a second agreement unless there is adequate trade justification.

The Department has been aware of the difficulty in the pending trade agreement negotiations with the Latin American Republics of finding products which can be, consistent with the policy outlined above, included in Schedule II. The fact that such products are limited in number (with most of them on the free list) may affect the negotiations unfavorably or perhaps later militate against Congressional ratification.

The suggestion has been made, therefore, that in connection with the pending negotiations with the Latin American Republics notes be prepared by this Government which will list those concessions of interest to each of the other Governments selected from other trade agreements but which cannot be written into Schedule II of the agreements because of failure to meet the requirements referred to above. The purpose of such notes would be to further the success of the negotiations and, after their conclusion, to aid in obtaining Congressional ratification. It would be primarily an accommodation to the various Governments with which we are negotiating.

On the basis of its studies so far, the Department is not entirely convinced of the necessity of sending such a note. Before deciding the matter definitely, however, it wishes to learn the opinion of the various missions concerned. You are therefore requested to report fully on this subject, emphasizing whether or not you believe that the negotiations which you are now conducting with the Nicaraguan Government would be materially influenced by the plan under consideration.

Very truly yours,

For the Secretary of State:
Francis B. Sayre