711.652/85: Telegram

The Secretary of State to the Ambassador in Italy (Phillips)

16. Your 50, February 8, 1937. The Department regrets that there should be any misapprehension on the part of the Italian Government in regard to our intentions in connection with the negotiations for the Treaty of Friendship, Commerce and Navigation. There is no desire whatsoever on our part to delay proceedings and Mr. Sayre6 so informed the Italian Ambassador on February 1st, adding that he hoped that negotiations might be concluded in time to permit the new treaty to be submitted to the Senate before Congress adjourned next summer.

The report to which you refer may have had its origin in a despatch from Ambassador Suvich to his Government with respect to Mr. Sayre’s testimony before the House Ways and Means Committee when extension of the trade agreements act7 was under consideration to the effect that negotiations with Italy were inactive. Suvich on instructions from his Government called on Mr. Sayre about this February 1, 1937, and Mr. Sayre explained to him that his testimony had reference to trade agreement negotiations and not to treaty negotiations, that we were anxious to go ahead with treaty negotiations, and that we expected to make a counter proposal within the near future.

We feel that as we are now in process of negotiating a basic treaty, we should confine our efforts to those negotiations. You should, therefore, discourage any discussion of the trade agreement. We are anxious to reach an understanding with regard to the fundamental principles underlying the regulation of Italo-American trade and in attaining this end, it becomes of first importance that we reach a satisfactory agreement in respect of Article 8 of the proposed treaty.

Far from being indifferent to the substitution of new arrangements for the present treaty, this Government is anxious to work out such arrangements well ahead of the time when the old treaty shall terminate when this Government might find itself under the necessity of suspending the generalization of our trade agreement concessions to Italian products. Moreover, since the success of trade agreement negotiations will depend upon the extent to which the commercial policies of the two countries can be reconciled, successful negotiations for the new commercial treaty will pave the way for effective trade agreement negotiations.

A decision with reference to a counter proposal to the Italian draft of Article VIII has been somewhat delayed on account of extra work [Page 437] in connection with renewal of the trade agreements act, but we expect shortly to forward instructions in this regard. In this connection, it should be noted that the Italian proposal has been in the Department only since the first of January whereas the Italian Government did not reply to our proposal until the expiration of over 2 months.

From a tactical standpoint, we do not deem it feasible or practicable to give any indication of the Department’s impression of the Italian treaty or trade agreement proposals as a whole. With regard to the Italian suggestions looking to a trade agreement transmitted with your despatch No. 129 of December 21, 1936,8 it was not the Department’s understanding that any expression of opinion by the Department was required and therefore no adequate study of the Italian suggestion to that end has so far been made here.

You are authorized to use any of the foregoing in your conversations with the Italian authorities.

  1. Francis B. Sayre, Assistant Secretary of State.
  2. The Trade Agreements Act of June 12, 1934, was extended by Joint Resolution, March 1, 1937; 50 Stat. 24.
  3. Not printed.