611.6831/235a
The Secretary of State to the Minister in Greece (MacVeagh)
Sir: Reference is made to your conversations with various officers of the Department, held during your recent visit to the Department, regarding the possibility of undertaking trade-agreement negotiations between the United States and Greece.
This subject has been given careful consideration by the interdepartmental trade-agreements organization and, on the basis of a report dated June 8, 1939,1 prepared by the Subcommittee on Greece, it is thought that a basis may exist for the negotiation of a trade agreement between the United States and Greece. Copies of this report and the two supplements thereto are enclosed for the Legation’s strictly confidential information.
As indicated in the aforementioned report of the Subcommittee on Greece, it appears possible that concessions could be made on a fairly large number of commodities of mutual interest to both countries. Although reciprocal concessions by Greece and the United States may not be expected to result in any large expansion of the total trade between the two countries, it would nevertheless appear desirable to broaden and consolidate the existing provisional commercial arrangement in so far as possible, now that Greece has undertaken formally to grant American trade equality of treatment in respect of all forms of trade and payments control.
The Department would of course prefer that the initiative in any discussion of the possibility of undertaking the negotiation of a trade agreement be taken by the Greek Government. In a conversation with an officer of the Department regarding the allegation of the Greek Government that the reduction in duty on dried figs contained in the trade agreement recently concluded between the United States and Turkey2 was discriminatory against Greece, the Minister-Counselor of the Greek Legation stated that he would advise his Government to [Page 604] consider the possibility of requesting trade-agreement negotiations with the United States (see memorandum of conversation of June 2, 1939 enclosed with Department’s Instruction no. 592, July 10, 1939).3 It is therefore possible that such initiative may be taken in the near future by the Greek Government. However, if by the date of your receipt of this instruction the question of the possibility of undertaking trade-agreement negotiations has not been raised with you by the competent Greek authorities, and if you perceive no objection because of the present situation in Europe or otherwise, the Department desires that you seek an early opportunity to discuss this matter with the appropriate Greek authorities with a view to ascertaining the attitude of the Greek Government relative to the negotiation of a trade agreement.
If the Greek Government evinces an interest in undertaking the negotiation of a trade agreement, you should point out that the Trade Agreements Act,4 under the authority of which the trade agreements negotiated by this Government are concluded, requires that public notice of intention to negotiate a trade agreement must be given in the United States before definitive negotiations may be undertaken. (The practice of issuing a preliminary announcement that negotiations are contemplated has been discontinued.) In order to avoid, so far as possible, delays in the progress of negotiations, it is the usual practice of this Government, before giving the required public notice, to reach an understanding with the other Government as to the principles and objectives on the basis of which it is expected that negotiations will take place. As the purpose of this public notice is to provide an opportunity for interested persons in the United States to present information and views, you should state that prior to the receipt and careful study of such information and views any conversations between the two Governments in regard to the tariff treatment of particular products are necessarily tentative. You should emphasize that it is essential to avoid publicity in regard to preliminary discussions which might or might not lead to public notice of intention to negotiate a trade agreement.
You should inform the Greek Government that, since the commercial policy of the United States is based upon the principle of equality of treatment, it is customary to include, in the trade agreements which are concluded between the United States and other countries, general [Page 605] provisions designed to carry out this principle, as well as to safeguard the reciprocal concessions. In view of the fact that the modus vivendi between the United States and Greece which became effective January 1, 1939,5 contains reciprocal assurances of non-discriminatory treatment with respect to all forms of trade and payments control, the Department assumes that there would be no difficulty in incorporating essentially similar provisions in the general provisions of a trade agreement.
You should also state that an important object of the proposed trade agreement between the United States and Greece would be to increase the trade in both directions between the two countries. With this end in view, it is contemplated that in respect of products of which each country is the principal or an important source of the other country’s imports the proposed agreement would include schedules of reciprocal reductions of existing high import charges, as well as the binding in other cases of existing customs treatment. In view of the existing system of quantitative restrictions upon imports into Greece, this Government would also expect to obtain in the agreement specific minimum quota assurances with respect to certain products of important interest to the United States.
There are enclosed two copies of a proposed draft of general provisions for inclusion in a possible trade agreement between the United States and Greece. If the Greek Government expresses an interest in undertaking the negotiation of a trade agreement, you are requested to transmit to the competent Greek authorities a copy of this proposed draft of general provisions, together with a copy of the enclosed explanatory comments.6
Should the Greek Government express its readiness to negotiate a trade agreement on the basis of the enclosed draft general provisions, and to give consideration, during the course of the negotiations, to such requests as this Government may make for reductions in the total import charges imposed by Greece on articles of which the United States is an important supplier of Greek imports, as well as to requests for specific minimum quota assurances on such articles, you should inform the appropriate Greek officials that this Government is prepared to give immediate consideration to the possibility of issuing a public notice of intention to negotiate a trade agreement with Greece. In this connection you should state that it is the practice of this Government to publish, along with the required public notice of intention to negotiate, a list of the products in respect of which the Government of the United States will consider [Page 606] granting concessions to the other government concerned in the proposed negotiations; and that therefore we would appreciate receiving a list of articles with respect to which the Greek Government would expect to receive tariff concessions, it being understood that this Government is not in general in a position to grant concessions to Greece on articles of which Greece is not the principal or an important supplier of imports into the United States. You should point out that, while there is no necessity for the Greek Government to indicate at this stage the exact nature of the concessions to be requested, the list should be comprehensive for the reason that it will be difficult to consider any articles not contained in the published list. The list submitted by the Greek Government should include both the United States tariff-paragraph number and a description of each article, the description conforming as closely as possible to the United States tariff nomenclature.
You should also emphasize that, since the purpose of the required public notice of intention to negotiate a trade agreement is, as stated above, to provide an opportunity for interested persons to present their views relative to the proposed agreement, it is of course not possible for this Government to undertake any commitment in regard to the products which might be included in the proposed agreement with Greece, or the extent of the concessions which might be granted on such products, before the views of interested persons are received and appropriate consideration given to them. You should also point out that, under the authority of the Trade Agreements Act, the President of the United States may not modify any existing rate of duty by more than 50 percent and may not transfer any article between the dutiable and free lists.
Upon receipt of information that the Greek Government is desirous of undertaking the negotiation of a trade agreement, the interdepartmental trade-agreements organization is prepared to proceed as rapidly as possible with the preparation of a preliminary list of articles of which the United States is in general the principal or an important supplier of Greek imports and which it desires to have considered in the negotiations for tariff concessions or quota assurances by Greece. You may inform the Greek authorities that the Department will be glad to transmit to them a list of such articles as soon as possible, it being understood that the list would be subject to modification in the light of information from the trade which may be received following public notice of intention to negotiate and the public hearings held pursuant to the terms of such announcement. In this connection, you should inform the Greek authorities that while the United States does not publish a list of products on which concessions may be requested from the other Government in trade-agreement [Page 607] negotiations, nevertheless the public announcement gives interested persons an opportunity to submit their views regarding such products in writing or orally at the public hearings.
There are enclosed herewith three copies of the Department’s press release no. 330 of August 16, 19397 containing the formal notice of intention to negotiate a new trade agreement with Belgium, which you may wish to bring to the attention of the Greek authorities as illustrative of our trade-agreements procedure.
The publication of this Government’s formal notice of intention to negotiate a trade agreement, together with the publication of the list of products under consideration for the granting of concessions to the other country, is customarily followed by a period of about six weeks during which interested persons in the United States may submit their views in writing with respect to the proposed negotiations, which in turn is followed by public hearings at the end of a further week or ten days. After an additional brief period for the study of the information thus received, this Government is then in a position to proceed with definitive negotiations.
With reference to the possibility of this Government’s granting a tariff concession on figs in a possible trade agreement with Greece, the interdepartmental Committee on Trade Agreements is strongly opposed to any such concession, for the reasons stated in the report of the Subcommittee on Greece of July 26, 19398 enclosed herewith. However, for your confidential information at this time, the Committee has approved a proposal to inform the Greek Government, if it is disposed favorably to enter into trade-agreement negotiations on the basis outlined above, but insists upon a tariff concession on dried figs in the agreement, that the Committee would be prepared to include dried figs in the list of products to be published along with the formal notice of intention to negotiate a trade agreement with Greece and therefore to give active consideration to the granting of some concession on this item, the exact nature of any concession to be determined after further investigation and in the light of information obtained from interested persons following the public announcement of intention to negotiate a trade agreement with Greece. Therefore, if the question of a concession on dried figs should be raised specifically by the Greek authorities, you should inform them that this Government, having reduced the duty on figs under the trade agreement with Turkey, is not disposed to consider granting any further concession on this product, and you should endeavor to obtain their assent to the exclusion of dried figs from the list of products [Page 608] to be considered in the negotiations. If the Greek authorities should continue to insist upon a concession on dried figs, you should merely state at this time that you will be glad to transmit their request for such a concession to your Government along with their other proposals regarding a basis for undertaking trade-agreement negotiations.
Please keep the Department informed briefly by telegraph of any important developments in connection with these matters.
Very truly yours,
- Not found in Department files.↩
- Department of State Executive Agreement Series No. 163, or 54 Stat. 1870.↩
- Neither printed. The Greek contention was that the concession on figs valued at more than 7 cents a pound would injure the trade in Greek figs, which were valued below 7 cents. The Department in an aide-mémoire of June 28 to the Greek Legation pointed ont that the concession to Turkey was in return for Turkish concessions and expressed the belief that it was doubtful whether the market for Greek figs would be affected. (611.683/23, 24)↩
- Approved June 12, 1934; 48 Stat. 943.↩
- Provisional Commercial Agreement, signed at Athens, November 15, 1938. See Department of State Executive Agreement Series No. 137, or 53 Stat. 2046.↩
- Neither printed.↩
- Department of State Bulletin, August 19, 1939, p. 135.↩
- Not found in Department files.↩