Memorandum of Conversation, by the Assistant Chief of the Division of Commercial Treaties and Agreements (Deimel)

Participants: The Iranian Minister
Mr. Merriam, NE
Mr. Deimel, TA

Mr. Merriam referred to a remaining balance of funds due American creditors which has been blocked in Iran since the imposition of exchange control in 1936. He said it was understood that the total amount involved was in the neighborhood of $50,000, that the Iranian debtors had not, apparently, questioned the validity of the debts and in some cases had made rial deposits in Iranian banks to cover them. The Legation at Tehran had taken the matter up repeatedly with the Foreign Office, with the result that the Iranian Government had agreed in principle to provide for the necessary dollar transfers, but for some reason this had never been done. The American creditors concerned were continually communicating with the Departments of State and Commerce and with our representatives in Iran in regard to the question and we should be glad to have it cleared up. The Iranian Minister said that he would make inquiries of his Government.

Mr. Deimel then referred to the preceding conversation with the Minister relative to a possible basis for trade agreement negotiations. He said that in accordance with the understanding reached at the meeting on November 15,89 the subject had been discussed in the Trade Agreements Committee, which had, he felt, obtained a sympathetic understanding of the Iranian position with respect to the two problems involving particular difficulty, namely: the questions of Iranian exchange control and government monopolies. The necessity of our obtaining appropriate guarantees against real discrimination was pointed out to the Minister, who was told, however, that we wished to avoid raising difficulties of an imaginary nature; that we were therefore looking further into the subject, pending the arrival from our Legation at Tehran of a report which had been requested on the Iranian Government monopolies and their application to American trade, in the hope of discovering some effective solution; and that at the same time the commodity trade between the two countries was being reexamined.

The Iranian Minister was reminded that the standard provisions, copies of which had been supplied to him and to his Government, did [Page 692]not constitute a definite proposal on our part but merely a basis for discussion. The Minister said that he quite understood this.

There followed a renewed discussion of the various points involved and also an explanation of our trade agreement procedure, including reference to the regular announcement of intention to negotiate, and the list of commodities customarily published therewith. The Minister said that since our last conversation he had discussed the matter with the Iranian trade representative in New York, Mr. Amerie, who assured the Minister that the difficulties with respect to exchange control and government monopoly commitments were not real difficulties at all, but the Minister said of course he had to follow the views of his own Government. However, it was suggested that Mr. Amerie might be of some assistance in this connection with respect to possible commodities to be covered in negotiations, and the Minister offered to ask Mr. Amerie to come down to Washington at any time this might prove desirable.

It was also agreed that we would call the Minister in again as soon as there was anything further to discuss with him.

  1. See memorandum by the Assistant Chief of the Division of Commercial Treaties and Agreements, November 15, p. 688.