611.5731/190

The Department of State to the Norwegian Legation

Memorandum

The Department has carefully considered the aide-mémoire of April 27, 1938 which was left at the Department by the Minister of Norway [Page 630]and which contains the views of the Norwegian Government with respect to the possible negotiation of a trade agreement between the United States and Norway.

The Department is particularly gratified to learn that the Norwegian Government is in sympathy with the trade-agreement policy of the American Government and is anxious, through the conclusion of a trade agreement, to contribute to the objectives of American commercial policy which are to liberalize world trade through the reciprocal reduction of excessive restrictions on that trade.

Officials of the Department have on numerous occasions, notably during Foreign Minister Koht’s visit last fall and in recent conversations with the Minister of Norway, outlined the views of the American Government with respect to an acceptable basis for possible trade-agreement negotiations. The Department is firmly convinced that a basis exists for such negotiations concerning all or most of the products of which each country is the principal or an important supplier to the other. The object of such an agreement would be to increase the trade in both directions between the two countries, by means of reciprocal reductions in existing tariff rates on certain products, as well as bindings of such rates on other products. It is on this basis that the United States has negotiated the trade agreements which are now in effect and is negotiating further trade agreements at present.

The Department is of course fully appreciative of the importance attached by the Norwegian Government to the question of a reduction in the duty and excise tax on whale oil. It has therefore exerted every effort to secure the removal of the excise tax through legislative action and, in view of the unsuccessful outcome of that effort, has frankly stated, in the Department’s memorandum of February 11, 1938, the extent of a possible reduction in the duty and tax on whale oil which this Government would be prepared to consider in connection with broad trade-agreement negotiations as outlined above. By virtue of the general provisions of the proposed trade agreement, the rate of duty and tax which might be established in the agreement would be bound, of course, against any increase during the life of the agreement.

Careful study has been given to the proposal made in the Norwegian Legation’s aide-mémoire of April 27, 1938 as a basis for trade-agreement negotiations. This proposal is greatly appreciated and the Department hopes that the Norwegian Government will find it possible, after further consideration and study, to enter into trade-agreement negotiations on the same broad basis as the United States is prepared to enter into such negotiations. The Department of State has indicated that this Government would be willing to consider in [Page 631]connection with trade-agreement negotiations duty reductions or bindings on 45 Norwegian products which accounted for 61 percent of total imports for consumption from Norway valued at nearly 22 million dollars in 1936. Therefore, the Department would expect that the Norwegian Government would be willing likewise to consider, in connection with trade-agreement negotiations, duty reductions as well as bindings on the products of which the United States is the principal or an important supplier to Norway.