740.00119 E.W./7–546
Memorandum of Conversation, by the Secretary of State52
The Italian Ambassador53 called to see the Secretary this morning by appointment arranged through Mr. Dunn. The Ambassador stated he was called home by his government to confer one or two days on the situation of Trieste in view of the agreement reached by the four Ministers. He said that dissatisfaction, consternation and distress were so great in Italy that he feared the consequences. He stated that Prime Minister de Gasperi felt very despondent as a result of the agreement regarding Trieste since it was so different from the starting point in London. The Ambassador said that Italy has made a great concession but he felt it was in the interests of world peace. He then inquired whether the Secretary had any message which he wished to convey to the Prime Minister.
The Secretary replied that he had no message. He said he gathered from the Ambassador’s remarks that the Italian people were dissatisfied. Having played a part in starting the war, Italy has reached the position where peace is being made. The Secretary said it was inevitable that those who shared the views of the Ambasador and Mr. de Gasperi and those who have been doing all in their power to remedy the situation should be disappointed. He said he judged they did not expect to be asked to pay any reparations or to have the victorious Allies ask anything of them as an enemy country. He remarked, however, that when de Gasperi was in London he had no reason then for believing that there would be anything but an insistent demand to take Trieste into Yugoslavia. The Prime Minister knew that we were making an effort to establish an ethnic line and deep down in his heart he must believe the decision was better than he had expected.
The Secretary continued that had it not been for his devoting all his time to prevent it, Trieste would certainly have gone to Yugoslavia. He said de Gasperi knew this, also. He continued that it was his belief that for the people of Trieste this agreement was far better in the long run. He stated that during his fight there was a [Page 778] very serious thought in his mind all the time. After the peace treaty was signed, the U.S. and British troops would have to leave Trieste. With the departure of our troops, Yugoslavia, overwhelming in strength and more interested in Trieste than in anything else in the world, would undoubtedly find some incident as an excuse for stepping in and taking charge. He explained that the Yugoslavs are fanatical in their belief that Trieste belongs to them and that it is robbery when we don’t give them that country. The Secretary stated that under the proposed international arrangement there is some assurance of stability. It will be necessary to have the Military Committee of the United Nations assign at least two brigades there. He said he believed these troops should come from states such as Canada and Australia, rather than from the United States or the Soviet Union. In this way the United Nations can use its influence to help the trade of Trieste and keep it alive. If something on this order is not done, Trieste will dry up. The Secretary said that the Yugoslav Vice-Premier Kardelj informed him that Yugoslavia controls the railroads, and that if Trieste were left with Italy or left in an international zone Yugoslavia would see to it that no business went there and would divert it to another field. They would not furnish traffic and trade to the Italians. The Secretary said it was evident that the Yugoslavs hated the Italians with a terrible hate. They remember wrongs inflicted 20 years ago.
The Secretary said he had advised Kardelj that he ought to live in the present and recall that this was not the government which he claimed was so oppressive; that he ought to look to the future, and with the democratic government now in Italy the two nations must settle their differences and must, live in peace and harmony because the world just cannot be sending in troops to keep order between them.
The Secretary continued that there is some chance that Trieste can remain a live port. He explained that no man from the outside would have been putting capital into any business in Trieste unless there was some assurance that order would be restored. Neither would a man who is very wise be extending his investments there if he thought the Yugoslavs were coming in in a month or two.
The Secretary stated he had realized it would be disappointing to the people there, and when people’s passions are aroused they will not see the military danger. Some would be willing to fight it out. But the Secretary said Italy was in no position to fight it out, not even economically. He expressed the belief that they will have a chance now. He stated that if the nations of the world are interested in the welfare of Trieste they may protect it from a military standpoint and they may develop it from an economic standpoint.
[Page 779]The Secretary then referred to the payment of reparations out of current production. He said he had inquired of Mr. Carandini regarding any understanding between Italy and the Soviet Union as to the method of payment of reparations and Carandini had replied that he thought there was some basis for it. However, there was no agreement between the two governments. Carandini had explained that the industrialists feared their equipment would be taken from them and preferred to pay out of current production. The Secretary said he therefore tried to figure out a plan for current production. He said that two days ago he received a message from the Italian Embassy in Washington that Italy did not want to give up the two ships, Vulcania and Saturnia, as she wanted to use these ships to earn dollars for foreign exchange.54 The Secretary had therefore agreed to take the ships out. He said that at the Council meeting last night he had insisted that Italy get a moratorium of two years before beginning payments out of current production as he did not believe Italy was in a position to start the delivery of any production currently. He explained that Italy must have a chance to get on her feet first. Molotov finally agreed to the two years, and he also agreed to the proposal that Russia furnish the raw materials, which was the only plan the Secretary could agree to. The Secretary said that Italy’s position could not be compared to that of Rumania, Bulgaria or Finland, who had raw materials whereas Italy had nothing except sulphur and fruits. At the end of two years Italy might be able to make an arrangement, and it is left to Italy to negotiate with the Soviets as to what commodity would be manufactured. He stated that Molotov had demanded in addition to his 100 million dollars that 100 million be paid each to the governments of Greece, Albania and Yugoslavia. The Secretary said there was no provision in the agreement for that except that it be left to the Peace Conference to determine. The Secretary concluded by stating that he spent three weeks of his life making this fight for Italy under very difficult circumstances. He said he understood de Gasperi’s position but he doubted [Page 780] whether anybody in Italy would understand the position of the Soviet Government in its efforts to back the Yugoslav Government.
The Ambassador in reply stated that he wished to thank the Secretary for all he has told him and he would convey this message to his government. He said that when he spoke of disappointment and consternation he did not intend to imply that they were ungrateful to the Secretary for his efforts. He stated they understood quite well his difficulties in his fight, and that if he was forced to abandon his original position it was certainly not his will but for higher political reasons or because of his conscience he had thought it better for Italy. The Ambassador explained that they were disappointed only on the issue itself; that they distinguish Mr. Byrnes’ and Mr. Bevin’s position from the issue, and the Secretary must not think that they don’t understand this.
The Ambassador continued that he understood very well the Secretary’s belief that danger in the area can be avoided by internationalization of the district. However, it was very difficult for them to reconcile themselves to the idea of Istrian towns being abandoned to Yugoslavia. He said that Italy would have in her frontier about 20,000 Slavs and there will be about 150,000 Italians in Yugoslavia.
Referring to the Secretary’s remarks concerning the Yugoslav control of the railroads in the Trieste area, the Ambassador inquired whether he thought it would be possible to make some arrangement with Yugoslavia to facilitate this problem.
The Secretary replied that Italy could never make any such arrangement with Yugoslavia. He restated his belief that under Italian rule Trieste would eventually dry up, unless the United States and Britain could keep troops there. The United Nations, which means the world, would be able to make such an arrangement. He expressed the belief that the Yugoslav attitude would be entirely different now because she will be fighting the world instead of a disarmed Italy.
The Ambassador again thanked the Secretary for his message and stated that when he returns, if he has some information which he thought the Secretary should have he would like to call on him again.
The Secretary in conclusion said he knew the situation in Italy was very difficult. He asked the Ambassador to tell de Gasperi that he understood his position and had great respect for his ability and his courage.
The Ambassador added that the Prime Minister was very sad about not having received a reply to his request to be heard.
The Secretary replied that he had presented to the conference the request that both Italy and Yugoslavia be heard at the peace conference. However, the Soviets objected, and under the unanimity rule nothing could be done about it.
- The conversation took place at the Secretary’s suite at the Hotel Meurice.↩
- Marquis Antonio Meli Lupi di Soragna, Italian Ambassador in France.↩
- Telegram 3249, Secdel 403, July 3, 1946, to Paris, not printed, stated that the Department had been informed by the Italian Embassy that the Italian Government had, on June 29, handed notes to the American, British, Soviet, and French Ambassadors asking (1) that a determination of Italy’s ability to pay be made prior to any decision on reparations, (2) that the claims of the United Nations be examined, (3) that an Italian representative be given an opportunity to explain the Italian viewpoint, and (4) that questions of sources of reparations be made in agreement with the Italian Government and not unilaterally determined by the Allies. The telegram further stated that the Italian Embassy had informally emphasized that the Italian Government would much prefer to pay reparations from current production, especially if the Soviet Union provided raw materials, than lose the Saturnia and Vulcania which the Italian Government regarded as sources of immediate foreign exchange earnings (740.00119 Council/7–346).↩