The Secretary of State to the Ambassador in Italy (Phillips)
36. Your 86, February 8, 11 a.m. We have not at any time lost sight of the desirability of finding a more mutually satisfactory basis for Italian-American trade relations and I hope you will assure the appropriate Italian authorities of our desire to that end. We have ever since the signing of the present modus vivendi carried forward studies of the numerous complex problems incident to that trade with a view to finding a basis for adjustment. The war has of course added new problems. Furthermore I am sure that the Italian authorities will appreciate the difficulty caused by the present discussion in Congress of the renewal of the Trade Agreements Act.
We recognize that there has been a certain delay in replying to the Italian Government’s note verbale of October 7, 1939. That delay has not been due to indifference. We are equally interested in lowering the barriers now restricting Italian-American trade, and we are anxious to find a basis for increased trade and improved trade relations. However, we are unable to see how modification of the modus vivendi would contribute to this end.
I think the Italian authorities clearly understand that any trade agreement which we might be prepared to negotiate must follow the basic pattern of the trade agreements which we have already negotiated with other countries. One of our major difficulties in studying the possibilities of a trade agreement with Italy is the fact that Italian commercial practices are frequently at variance with the treatment we would expect to be accorded American commerce. Our consideration of the possibility of trade agreement negotiations would be materially helped if the Italian Government were to submit comprehensive proposals to us. You can assure the Italian authorities that any such proposals as they might care to make would receive our early and sympathetic consideration.39
It may be added for your own information that in addition to the points outlined above the recent action of the Italian Government as outlined in your 78, February 1,40 adds very material complications.