611.60H31/148: Telegram

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

164. Department’s 46, November 10, 1 p.m.

As soon as Pilja and other negotiators return from Rome I shall request meeting in order to emphasize to them Department’s views contained in paragraphs 1 and 2 of Department’s telegram.
As to paragraphs 2 and 3, in the event that we cannot persuade Yugoslav Government to agree to grant to us percentages covering representative period (that is quota of 40 per cent for passenger automobiles and 35 per cent for trucks) will the Department accept, with the reservation that it does not satisfy the requirements of the policy of the United States Government, a unilateral declaration on the part [Page 703]of the Yugoslav Government that it will grant us quotas for passenger automobiles and trucks each for 30 percent of the total importations of the respective products into Yugoslavia for the preceding 3 months? Thus if the total passenger automobile imports for the last 3 months of 1938 should amount to 25,000,000 dinars we should have a quota for the first 3 months of 1939 of approximately 7,500,000 dinars, any unused portion to be carried over to the next quarter or quarters.
We are compiling figures on other controlled items and will submit shortly to the Department our recommendations. It must be borne in mind, however, that Yugoslav authorities have indicated unwillingness to grant percentage quotas for these items although they are apparently willing to grant us same quantitative importations as we enjoyed in 1935. Even should Yugoslav Government agree to grant us a percentage quota for each controlled product negotiations would necessarily be extended.
As to paragraph 2 supra I should appreciate the Department’s specific instructions, for my guidance, (a) whether unilateral declaration by Yugoslav Government with respect to automobiles and trucks would be acceptable as a temporary expedient, even though we may not now be granted quotas for other controlled products other than those equal to our 1935 quantitative importations; (b) if so whether it should be tendered to us orally or in writing; (c) and in latter case what reservation we should make in acknowledging note.
In view of my proposed departure on November 27 I should appreciate an urgent reply so that I may be prepared for next meeting.