The Chargé in Belgium (Tuck) to the Secretary of State
[Received June 29.]
Sir: I have the honor to refer to the Embassy’s despatch No. 160 of February 7, 1938, concerning certain conversations with Mr. [Page 211]Leurquin, the Assistant Director of the Section of Commercial Accords at the Foreign Office, in regard to the failure of the Belgian Government to observe the terms and spirit of the Trade Agreement with the United States.
In the months which have elapsed since my conversations with Mr. Leurquin, some of the specific commodities mentioned in the memorandum and annexes which were left with Mr. Leurquin on February 4, 1938, and which were transmitted to the Department under cover of despatch No. 101 of December 13, 1937,11a have been discussed with representatives of the Foreign Office in an attempt to improve, if possible, the situation as described in the memorandum. In these occasional informal conversations the position of the assemblers in Belgium of American automobiles has always been avoided by the Belgian officials who have stated that they did not wish to go into that for the present as an exhaustive study of the automobile industry was in progress and it was better to await its completion before making even any unofficial statements.
On its side the Embassy had not pursued its representations of a general nature concerning violation of the Trade Agreement but had confined its efforts to an attempt to obtain favorable treatment in the case of individual commodities. The Embassy in this matter was guided by the Department’s telegram No. 4 of January 13, 1938, 8 p.m., in this sense. There appeared to be reason to hope during Mr. Paul Culbertson’s visit in April and May and immediately afterwards that the excellent work done by him would bear fruit in the speedy submission through the Belgian Embassy at Washington of an acceptable Belgian counter draft and the successful negotiation of General Provisions. (See the Embassy’s telegram No. 47 of May 4, 1938, 1 p.m.) It is true that shortly after Mr. Culbertson’s visit to Brussels, Mr. Suetens, the Director of the Section of Commercial Accords, and Mr. de Fontaine, also of the same Section, went to Oslo for the Meeting of the Oslo Powers, and that since their return various other current negotiations have kept them very busy. The fact remains that although Mr. Suetens assured me as recently as June 16, 1938 that he hoped to be able to send the Belgian counter-draft to Washington at an early date, it has not yet gone forward.
Such is the relevant background of a recent series of events which I feel compelled to report to the Department for its information although, as will be seen later in this despatch, the Prime Minister and Minister for Foreign Affairs and Foreign Commerce, Mr. Spaak, has in a sense annulled the action of his subordinates.
On June 16, 1938, I called upon Mr. Suetens at the Foreign Office at his request, and was received by him and Mr. Leurquin. Mr. [Page 212]Suetens handed me an Aide-Mémoire with a Memorandum enclosed concerning the “Automobile Policy of the Belgian Government.” The Aide-Mémoire was dated June 16, 1938, and the Memorandum May 25, 1938, and Mr. Suetens stated that he was making them available to me for transmission to my Government in order that it might have an opportunity to express its views before August 1, 1938, the date on which it was planned to have the new automobile policy go into effect. It was impossible to digest the substance of these documents while I was still with Mr. Suetens and Mr. Leurquin, and it was not until I returned to the Embassy that a careful study could be made of their contents, and at the same time copies and translations, which are enclosed, were prepared for transmission to the Department.12
It did not take more than a hasty perusal of the Memorandum to disclose the fact that the contemplated measures would go further than ever in a violation of the spirit if not the letter of the Belgian-American Trade Agreement, and that in the case of trucks at least restrictions were contemplated which could in no way be considered as depending upon legislation which antedated the Agreement.
In order to obtain an expression of opinion from at least one of the important American automobile assemblers, I requested Mr. E. W. Zdunek, Managing Director of the General Motors Company, to come to the Embassy, and in strictest confidence obtained his views on the subject. He told me quite frankly that he had known for some time that such a Memorandum was in preparation but he had understood it was not to be delivered to the Embassy because it did not meet with the approval of the Prime Minister, Mr. Spaak (whom he knows personally and sees from time to time).
My conversation with Mr. Zdunek took place on Friday, June 17, 1938, and on Saturday, June 18, 1938, I had an appointment to call on Mr. Spaak for the purpose of introducing to him Mr. McAneny, Chairman of the Board of Directors of the New York World’s Fair. While I was with the Prime Minister I took the occasion to mention the Aide-Mémoire and Memorandum, and he said he had been on the point of sending for me as he wanted very much to talk to me about the matter and requested me to come to see him at 10 a.m. on Monday, June 20, 1938.
Accordingly I called on the Prime Minister and Minister for Foreign Affairs and Foreign Commerce this morning, Monday, June 20, 1938, at 10 a.m. He asked me immediately what my objections were to the contents of the Memorandum, and I replied that the aims of the Memorandum appeared to me to be contrary to the Belgian-American Trade Agreement. I recalled that at the time of negotiation of the [Page 213]Agreement in 1935, there had been a proposal of requiring 40% Belgian content in automobiles assembled in Belgium and sold in the Belgian market, and that our Government at that time had rejected any such proposal. It was true, I added, that subsequently there had been a gentlemen’s agreement between the automobile industries in Antwerp and the Belgian Government which had effectually put this 40% into effect in so far as passenger automobiles are concerned. I said that any such proposal as the one contained in the Memorandum in question, even though submitted to our Government for its consideration, would, I felt sure, prove unacceptable and, frankly, would produce a very bad effect. I rehearsed briefly the steps which the Ambassador, Mr. Gibson, had taken with Mr. van Zeeland with regard to the operation of the Trade Agreement and the feeling that we had that there had been a failure on the part of the Belgian Government to observe the spirit of that Agreement. I said that as a result of that démarche there had been a change for the better but that subsequently we were faced with practically the same difficulties as had arisen previously. I told him that I had no wish to exaggerate the seriousness of the situation and I realized that the Memorandum, if forwarded, would only be for the consideration of our Government and for its observations, but that I experienced a certain amount of embarrassment in sending it on. Mr. Spaak immediately suggested that I return the Aide-Mémoire and added that he would talk with the competent services with regard to it and that an understanding along other lines would be sought. I thanked him for his understanding of the situation, and again stressed the fact that I had no desire to exaggerate the importance of the step which Mr. Suetens proposed, but that I felt certain that by returning the Aide-Mémoire and Memorandum to him, we could reach a more workable solution.
In accordance with Mr. Spaak’s request, I returned the Aide-Mémoire and Memorandum to him, and they are to be considered as not having been transmitted by the Foreign Office to the Embassy. It is considered advisable, however, to report what took place and at the same time to make available to the Department for its information the enclosed copies and translations of the Aide-Mémoire and Memorandum, which it is urged be treated as strictly confidential.