611.5331/178

Memorandum of Conversation, by the Assistant Secretary of State (Sayre)

The Portuguese Minister came to see me in order to discuss a possible trade agreement between our two Governments. He asked whether we are now prepared to enter into negotiations. I told him that we had some time ago appointed a committee to study Portuguese-American trade and that this committee expected to report its conclusions to the Trade Agreements Committee within the course of the next two weeks. I said that as soon as the Trade Agreements Committee had a chance to discuss the matter, I should be glad to get in touch with him at once and talk the matter over with him.

The Minister then went on to say that he came under explicit instructions from his Government to request that we send some representative over to Lisbon to discuss the negotiations before negotiations are formally begun. He said that his Government felt confident we could negotiate an agreement without difficulty but that it desired to have someone explain some of the technical and other questions involved and felt that this could best be done through personal conversations in Lisbon. The Minister made it clear, however, that the actual negotiations should be carried on in Washington rather than in Lisbon.

The Minister added that his Government felt there should be no difficulty in reaching an early agreement. He said that they were definitely prepared to discontinue flag discrimination. He also said that they now realized it would be impossible to secure in a trade agreement protection of wine designations and he felt that this would not be pressed. He said that his Government was interested primarily in sardines, cork and Madeira embroideries. I asked whether his Government was familiar with the general provisions which we insert [Page 665]in trade agreements and he assured me that it was and that there would be no difficulty in his Government’s agreeing to these since his Government is one of the countries which does not believe in quotas or exchange control.

He reiterated that he came to me under the express instructions of his Government.

I assured the Minister that I would look into the matter and let him hear from me within ten days or two weeks.

F. B. Sayre