560.AL/1–2848: Telegram

The Ambassador in Cuba (Norweb) to the Secretary of State

secret

118. For Brown and Treasury from Wilcox and Bronz. In connection with our 110, January 27 we request advice on assuming offensive on Article 23 by proposing new provision forbidding discrimination based on inconvertible currency held for more than say one year.

We have heretofore relied upon Section 10 (II) of Anglo-American financial agreement1 to protect US against trade discrimination based on accumulated sterling balances. If this provision does not stand up, we would be left with Charter Article which is not an adequate safeguard. If Britain keeps sterling inconvertible indefinitely, that fact alone might well constitute the widespread disequilibrium required under Article 23 and it would thereby be possible for holders of accumulated sterling balances, with ITO approval, to give British goods preference indefinitely.

Immediate advice essential because of late stage of negotiations. [Wilcox and Bronz.]

Norweb
  1. TIAS No. 1545 or 61 Stat, (part 2) 1841.