Foreign Relations of the United States, 1946, Council of Foreign Ministers, Volume II

C.F.M. Files: Lot M–88: Box 2063: US Delegation Minutes

United States Delegation Record, Council of Foreign Ministers, Second Session, First Informal Meeting, Paris, May 2, 1946, 5 p.m.

Paris, May 2, 1946, 5 p.m.

secret

Present

	U.S.A.
	The Secretary
	Senator Connally
	Senator Vandenberg
	Mr. Bohlen
U.K.		France
Mr. Bevin		M. Bidault
Sir Oliver Harvey		M. Couve de Murville
Mr. Jebb		M. Courcel
Mr. Peyton-Smith		Interpreter
	U.S.S.R.
	M. Molotov
	M. Vyshinsky
	M. Pavlov
	Interpreter

The Secretary, as Presiding Officer, suggested that since it had been M. Bidault’s proposal for an informal meeting that he be asked to outline his ideas.

M. Bidault said that he had thought it advisable, in order to find a way out of our difficulties, to have a smaller meeting in which the Ministers could discuss with greater freedom the basic differences which lay between them and eliminate the secondary problems. He said these difficulties could either be taken individually or as a whole. For example, in the case of the Italian treaty there were some relatively easy problems and some much more difficult, such as the territorial problems of Venezia Giulia, the Dodecanese Islands, the question of reparations and the colonies.

General agreement was expressed with M. Bidault’s views and the Secretary then suggested that they might follow the order in which these questions had come before the Council, which would bring the problem of the colonies first. He said in this connection that he remembered that M. Molotov had said he was not prepared to discuss the Dodecanese until other territorial questions had been considered.

M. Molotov stated that he saw two categories of important questions: one, the territorial questions, and the second the problem of reparations and restitution. In regard to reparations, it was a very simple question and it could not be denied that the Soviet request in respect to reparations was a very modest one. The territorial questions involved the colonies, the frontiers, and the Dodecanese. He added, however, that there was the matter of the treaty with Bulgaria which he said had a direct connection with the present meeting. The fact that neither the United States nor the United Kingdom had fulfilled their promise to recognize the Bulgarian Government had an important bearing on the peace treaties in general and on the Bulgarian treaty in particular.

The Secretary replied that if we were to hold everything up because of the Bulgarian situation he did not know how we were going to proceed. He then said that he wished to make a suggestion. He was not discouraged by the difficulties which we had encountered and we were still awaiting the reports from our sub-committees on a number of questions which had been referred to them. Tomorrow the Council would hear the Yugoslav and Italian representatives. He said that these questions would naturally take some time and it was now apparent that it would be impossible to hold any peace conference in the middle of May as we had hoped and that it would therefore be several months before we could expect the ratification and entry into force of an Italian or other peace treaties. He said therefore he would like to raise a question which he had proposed through diplomatic channels several weeks ago, namely, the United States draft for a revision of the Italian armistice conditions.⁷ This draft had been submitted before the Conference and therefore was not the result of any difficulties that had been encountered here but these difficulties made it obvious that there would be a longer delay in the conclusion of the peace treaties than we had hoped for and that this made the question of the revision of the armistice conditions pending the peace treaties of immediate value.

He said the French and Soviet Governments had agreed in principle with the United States draft with the exception of one amendment to Section 3–b. He hoped that the United Kingdom would accept this suggested amendment which was agreeable to the United States. He said he was circulating a draft containing this proposed amendment.⁸ This amendment related to the elimination to the reference to the Cunningham–De Courten Agreement concerning Italian ships.⁹

The Secretary continued that he thought that in the present circumstances it would be wise to extend the idea of revision to the other satellite countries under armistice terms.

M. Bidault remarked that it goes without saying that it would be a good idea to agree on the revision of the armistice terms but he hoped it would not be regarded as a substitute for the more important task of the Foreign Ministers, namely, the conclusion of the peace treaties. He hoped therefore that the Ministers would not restrict their agreements to a mere prolongation of the armistice terms and he hoped this would not be known as it might discourage the efforts to solve the more important problems of the peace treaties.

The Secretary replied that he agreed with M. Bidault and it was not intended in any way to discourage the efforts to seek agreement on the peace treaties but merely took cognizance of the fact that under the best circumstances several months would elapse before these treaties could come into effect. For example, in Italy the Italian Government was impeded in its efforts to restore normal conditions by the fact that it was subject to an Allied Control Commission. He repeated that he felt that similar revisions would apply to the Balkan countries and he hoped that M. Molotov would give them a draft of a suggested revision. He added that if these revisions could be adopted we could then have more time to work on the problems of the peace treaties.

M. Molotov replied that Mr. Byrnes’ proposal on Italy would not be hard to settle since there was general agreement on principle. As to Rumania and Bulgaria, he felt that there was hardly any analogy. He added in this connection that he felt the task of the Foreign Ministers was not to go into individual questions but to grapple with the fundamental question of the peace treaties. He asked if he had understood Mr. Byrnes correctly to say that under present circumstances no peace conference could be expected for one or two months.

The Secretary replied that he had obviously made himself not clear. He had merely said that the conference could not apparently be held in the middle of May as we had hoped, but that even after the conference it would take some time since there was the drawing up of the final draft of the Council of Ministers, the question of ratification by the signatories, and the entire process would, in his opinion, require at least two or three months.

Mr. Bevin replied that he was not fully in agreement with the suggested amendment which he had not had time to study. It appeared to him that the eliminated sentence took the control of the Italian vessels out of the Commander-in-Chief’s hands and he felt that England was being asked to give up control over the vessels they themselves had captured. He said no other Ally had agreed to do this in the war or had even been asked and inquired why England should be asked to do so. He said his instructions were not to accept unequal treatment for England in any of these matters and that this suggested amendment looked rather like unequal treatment. He was as anxious to help Italy and lighten the armstice terms as anyone but he did not see why England should be the victim of the change.

The Secretary replied that he felt that when Mr. Bevin had had an opportunity to study the suggested change he would find his fears removed.

Mr. Bevin agreed to study the change.

The Secretary then inquired whether there was any desire to discuss reparations first and said that he had not recently had any late report from the Reparations Committee but perhaps M. Vyshinsky might have some information on that point as he was sitting with the Deputies.¹⁰

M. Molotov said he did not believe it was a matter of the Experts Committee. The Experts seemed to have received instructions not to reply to the main question on reparations or reach an agreement. The question therefore lay not with the Experts but with the Ministers. He said the Soviet Union would stay on its own feet whether or not it received a hundred million dollars worth of reparations from Italy but that no decision on a treaty with Italy could be reached without a clear reply on the reparations question. He said the Soviet Delegation wished to know whether the United States, the United Kingdom and France intended to decide this question favorably. One hundred million dollars was only a small part of the claim that the Soviet Union could have presented but he wished to know whether his colleagues were ready to discuss and settle the Soviet proposal favorably. In his opinion the Experts needed instructions on the main issue.

Mr. Bevin replied that Great Britain was becoming accustomed to similar unfounded accusations. He said the British representative had very wide instructions to examine in the first instance the capacity of Italy to pay reparations and to look into what assets or goods could be used for this purpose. The British representative on this Commission, however, could not make any commitment with regard to this matter which would require Great Britain in effect to pay these reparations. He said that if the Soviet Delegation could offer a plan which did not require Allied payment to Italy and which would safeguard the dollar balances which Great Britain had to acquire to pay Italy he would be prepared to study it. He said the direct expenditures to Italy England was willing to leave aside. The dollar balances they would have to purchase with foreign exchange and any plan that took into consideration these two factors would receive serious study by the British Delegation. Any plan which ignored these two factors would not only be unfair but could not be justified before Parliament.

M. Molotov replied that Italy is an independent country and not a part of Great Britain and therefore should pay from their own account and not at the expense of Great Britain or any other Power.

M. Bidault suggested they return to the point of departure in this reparations question. He said some of them were concerned in regard to the capacity of Italy to pay and that others were concerned with fixing the total amount of reparations. The work of the Experts had not been bad but it was true that the solution lay not with them but with the responsible political principals at this conference. The Experts had studied the sources of reparation and had agreed on certain points. Some of these points were of more interest to other countries than to the Soviet Union, namely the question of state properties in ceded territories or territories which might be ceded, gold, and surplus war industries. As he understood the position of the Soviet Union it related primarily to reparations from current production. The United States and Great Britain objected on the ground that Italy had received assistance and still needed assistance and that therefore Italy was not in a position to pay reparations from current production. He wondered if it would not be possible to accept the thesis that reparations could be paid from current production if certain conditions were established. For example, such payment could be put off for a period of time until aid from abroad was no longer needed. He thought the Experts might work out some such plan in order to determine the quantity of current production which at some future date might serve as a basis for reparation.

Mr. Bevin inquired whether this meant that reparations could begin when relief ceased or when the relief had been paid for by Italy.

M. Bidault replied that he did not think this difficulty was insurmountable. It would be more logical to set the period when relief had ceased and then make an equitable division to cover damage caused by Italy during the war and repayment of relief already extended.

The Secretary said that he thought we would have to wait on the Commission’s report and that he hoped this report would take into account the fact that certain values would be given to countries having claims against Italy. For example, certain territory would be given to Yugoslavia and certain ships to the Soviet Union, France and to Great Britain. He felt these values already [although?] not technically reparations should be taken into consideration. He said that the fact that the United States had sent five hundred million dollars to Italy in order to enable the Italian people to live would have to be taken into consideration.

He added, furthermore, that loans were being requested by Italian industry from the Export-Import Bank and that if once this industry got going the first claim was for reparations. These loans would obviously not be paid back and therefore would be refused. The United States had adopted and would continue to adopt a liberal attitude toward relief. As he had said at Potsdam, he wished to state that the United States was not going to pour millions and millions of dollars into any country in order to permit it to pay reparations to others. The United States Delegation was prepared to examine any available source for reparations, external assets and any other source but was not going to do as it had done after the last war and that was pay out hundreds of millions of dollars for the reparations accounts of others.

M. Molotov said loans have nothing to do with reparations and particularly any United States loan to Italy. He knew that United States loans were being granted on certain terms to Allied countries but Italy was a defeated country. He said that no decision on the peace treaty could be made unless the reparation question was settled. He said other countries had put in larger claims than the Soviet Union. The Soviet Government was anxious to know what the attitude of the Allies was to their proposal and what practical means they suggested for solving it.

Mr. Byrnes said that he understood from M. Molotov’s remark that there would be no treaty unless the Soviet claim for one hundred million dollars for reparation from Italy was satisfied. If that was the question, he could give the answer. There would be no treaty.

M. Molotov said that his remarks had been misinterpreted, that he had asked the question how could there be a treaty unless the reparation question was solved.

The Secretary accepted this explanation and repeated that we would have to wait until our Experts had reported on Italian capacity to pay. He wished again to point out that ships also represented dollar values.

M. Molotov remarked that war vessels were not reparations but war booty.

The Secretary replied that this particular war booty had been captured by the United States and Great Britain and that their willingness to divide these vessels was in effect the transfer of property worth many millions of dollars to other countries. It made no difference whether it was called reparation or war booty or what, it was value received. For example, if as suggested by Mr. Bevin it was decided to turn over to Greece one vessel for the one sunk before the war, that ship would represent money and if it did not, Greece would not want it.

He added that the Brazilian Ambassador was calling to see him tomorrow and he knew he would ask for a ship to replace the one sunk by an Italian submarine during the war. He said he expected to tell him that if the United States received any Italian ships they would give one to Brazil and he was sure the Brazilian Government would not care whether it was called reparation or war booty because what they wanted was the ship.

M. Molotov said that it only remained to compare the losses suffered by the Soviet Union and Brazil and then everything would be clear.

Mr. Bevin said he wished to be helpful and he thought something might be done by examining the outstanding relief debt of Italy and the claims of reparations from Allied countries and then see how this sum related to M. Bidault’s suggestion.

The Secretary said that he would like to see some estimate made upon the amount of equipment for war industries which they had agreed would be available for reparations. He would have to consult his experts in order to get the facts.

M. Molotov remarked that they could consult their experts but that the question depended upon the Ministers.

At the Secretary’s suggestion M. Bidault agreed to reduce his proposal to writing and expressed the hope that they could find agreement because it would serve as an excellent precedent for the other problems.

The Secretary then said was there other subjects to discuss or might they adjourn.

Mr. Bevin said that they might discuss the Dodecanese question but he assumed the Soviet Delegation would not be ready.

M. Molotov replied that they had no objection to discussing territorial questions. He said he thought the British draft with regard to colonies¹¹ shows that England wishes to keep all the Italian colonies for herself and even take something from Ethiopia. He thought it might be difficult for England to digest these additional colonies.

Mr. Bevin said he thought this was entirely the wrong approach; that in regard to Eritrea Ethiopia had made a claim and he thought she should be heard. He went on to say that Great Britain did not want Somaliland and that they would be quite prepared to let the United Nations take over the Italian Somaliland. He said the British suggestion had been put forward in order to be helpful and that he thought they might sometimes give the British credit for pure motives. He had proposed an impartial commission to consider the advantages of a Somaliland union but if there was objection he would not present it. He had felt that if this proposal were regarded in a statesmanlike manner and not with suspicion, it might have been helpful. He said in one sense it merely meant that British money now spent on British Somaliland would be distributed over other Somalilands.

M. Molotov inquired whether Great Britain was suggesting immediate independence for Libya and the immediate withdrawal of British troops.

Mr. Bevin replied that what he had had in mind was a class A mandate with United Nations advisors instead of administrators. He said he felt this was a very small claim since the area had been won by British Dominion, French and native troops.

M. Molotov replied that Great Britain had many colonies and did not need any more. He said he felt that there was some common ground between the French, Soviet and the United States proposal on the colonies.

Mr. Bevin objected and said he could not tolerate consideration not being given to the British position.

M. Molotov replied that he had reference only to the British draft which he felt was too selfish.

Mr. Bevin answered with some heat that it was a strange statement for a representative of a country which by its own admission covered one-seventh of the earth’s surface.

M. Molotov retorted that this area had been acquired legally, to which Mr. Bevin replied that it was also through the medium of secret treaties and that perhaps England had made a mistake not to conclude similar arrangements during the war.

At the Secretary’s suggestion the meeting adjourned until 3 p.m. Friday, May 3, when in full session the Council would hear the Yugoslav and Italian representatives.

7. For documentation on the efforts of the United States to bring about a revision of the Italian armistice conditions, see vol. v, pp. 825 ff. For original draft text of the proposed revision, as communicated to the British and Soviet Governments, see ibid., p. 830.
8. The draft document referred to here is not printed. It was subsequently slightly revised and submitted to the Council as document C.F.M. (46) 84, May 14, 1946, also not printed. The proposed agreement for the revision of the Italian Armistice, as approved by the Council on May 16, is printed as C.F.M. (46) 95, May 16, p. 436; variations between C.F.M.(46) 84 and C.F.M.(46) 95 are indicated in footnotes to the latter document.
9. Reference here is to the memorandum of Agreement on Employment and Disposition of the Italian Fleet and Merchant Marine, concluded on September 23, 1943, by Adm. Sir Andrew Cunningham, Allied Naval Commander in Chief, Mediterranean, and Adm. A. R. De Courten, Italian Minister of Marine. For the text of the agreement, see Department of State Treaties and Other International Acts Series No. 1604, p. 28.
10. At their Second Meeting on April 26, the Council of Foreign Ministers decided upon the establishment of a Committee of Experts to consider the question of Italian reparations; see pp. 112 and 121. The Report to the Council by the Committee on Reparations was circulated to the Council as document C.F.M.(46) 53, May 7, 1946, p. 286.
11. Reference here presumably is to C.F.M.(46) 22, April 30, 1946, p. 194.