Foreign Relations of the United States, 1949, National Security Affairs, Foreign Economic Policy, Volume I

660.509/10–1349

Memorandum by the Secretary of State to the Assistant Secretary of State for European Affairs (Perkins)¹

secret

[Washington,] October 13, 1949.

In connection with your discussions in Paris regarding East–West Trade,² I would appreciate your giving due emphasis to the objective of the U.S. Government to secure cooperation of European governments to the end of denying the Soviet bloc materials and equipment useful in the development of atomic energy. It is the opinion of the AEC staff, with which I concur, that the announcement of a successful atomic explosion by the Soviets makes even more necessary the establishment of effective controls by all friendly countries over items which might contribute particularly to the production end of an atomic energy program.

It is self-evident that the success of a program such as this is dependent on the full cooperation of all important countries involved in the production or trade in materials of atomic energy significance. Any relaxation on the part of one country, either deliberately or through ineffective control mechanisms, will of course eventually result in reducing cooperation of all other governments to the lowest common denominator. With this in mind, the Department and the AEC have collaborated since May of 1948 in a program of securing informal agreements with the governments of the U.K., Canada, Sweden, Benelux countries, Norway, France, Switzerland, Bi-Zone Germany, and Italy. With the exception of France and Germany, agreement in principle has been obtained from all the other countries and in most cases effective control mechanisms are established.

In addition to giving the various Chiefs of Mission attending the Paris conference an outline of the importance of obtaining full cooperation to prevent the export to Soviet countries of these items, it would be useful if you acquainted the Chiefs regarding:

1. The relationship of these controls to those over other security items (ECA Lists 1a and 1b³).

2. Progress made in securing agreements with other governments pertaining to parallel controls over atomic energy items.

There follow brief background sketches relating to the above points:

1. Relationship of these controls to other security items:

During the initial consideration of control of general East–West trade on the part of Western European countries, it was decided that the handling of atomic energy items should be a matter separate from the handling of the ECA Lists 1a and 1b, primarily since: (1) the prevention of the export to Eastern Europe was a matter of clear mutual security concern of the United States and the other countries involved; (2) the general economic importance of trade in these items was quite insignificant relative to total East—West trade; (3) conversations regarding atomic energy items would of necessity involve governmental officials other than those who logically dealt with items on the ECA Lists.

To inaugurate the program, the Department forwarded to several diplomatic missions in Europe for action and to others for information, copies of what are known as the AEC Lists A and B, covering items which are under close export control in the United States and which are considered necessary for similar controls in Europe. List A consists primarily of items peculiar to atomic energy work such as radiation detection instruments, mass spectrometers, and particle accelerators. These are under the licensing control of AEC. List B includes certain general industrial items which have particular importance to atomic energy production. The lists are not classified.

Even though the negotiations have been handled separate from those involving ECA items, the mechanics for control of exports of atomic energy items are substantially the same as for the general security Lists A and B, particularly in countries having large industrial potentials (Great Britain, Canada, and Germany, and possibly France). Recent efforts have been directed toward determining, with propriety, how effectively the various governments have instituted controls which have previously been agreed to in principle.

2. Summary of agreements with other governments:

United Kingdom—Almost a year ago U.K. published a revised export schedule. This, combined with administrative controls, placed most of the U.S. list under control from Britain. The agreement covers about 80% of the U.S. List. The U.S. has requested concurrence on the balance of the list, and the answer of the U.K. Department of Atomic Energy is now pending. A reciprocal exchange of information on licensing action of the U.S., U.K. and Canada is now operative. (It may be observed that respecting the 1a List negotiated by ECA, we understand the British had agreed to controls over about 80% of the items. Agreement at the technical level was achieved on a substantial portion of the balance of the list but no further action has come to our attention.)

Canada—In July 1949, Canada took sweeping action to place under control substantially the entire list under discussion with them. Cooperation is complete.

Sweden—Sweden has full power to control all exports. In formal advice from the Swedish Government they agree to control (embargo to Soviet areas) List A items. A subsequent communication agrees to embargo to the Soviet Bloc those List B items considered important in the Swedish commercial picture.

Norway—Norway likewise has full power of control over exports. Only a few items on AEC Lists are produced in Norway. We are assured these are under embargo to the East. We expect the Norwegian Government will agree to embargo other listed items.

Netherlands—A secret list of prohibited exports includes all List A and B items which are now said to be under control. The actual method of administering these controls would be explained to the U.S. representative when such a visit is arranged.

Belgium—The Belgian Government has agreed to the principle of control and is administering this on an informal basis.

Italy—In July an agreement was reached that List A items would be embargoed to the Soviet Bloc. As to List B, Italy agreed to embargo those not previously active in foreign trade and would limit the remaining items to pre-war quantities. Trieste was being covered by collateral action.

Switzerland—Certain Swiss officials indicated informally willingness to secure “gentlemen’s agreements” with industries making important items on Lists A and B. This would take the place of any formal controls. It now appears the plans on this program were not followed through. Consequently, a new approach will be necessary.

Germany—The Military Security Board is now preparing a law which will be promulgated by the High Commissioner to place a ban on the production of and trade in most items on the AEC Lists. In the interim, pending promulgation of this law, items on the AEC Lists are being screened by the Office of the American High Commissioner to prevent shipment of these items to Soviet countries. It is envisaged that the control procedures which will be outlined to the new German Government will make possible incorporation of the AEC items on lists given the German authorities for screening purposes.

France—Our Embassy has been working discreetly with certain French officials to establish the desired controls. Progress has been rather slow, but at the earliest opportunity, discussions of the AEC lists which the French now have, will be resumed.

1. This unsigned memorandum was drafted in the Office of the Under Secretary of State, presumably by Arneson.
2. The reference is to the meeting of principal United States Ambassadors in Europe, held in Paris on October 21–22, 1949, under the chairmanship of Perkins. For documentation, see vol. iv, pp. 469 ff.
3. For information on the ECA Lists, see vol. v, pp. 69 ff.