Department of Defense Files
The Acting United States Military Governor for Germany (Hays) to the Military Attaché in France (O’Hare)
CC 8869. From Wilkinson for Magruder. Info Dept of Army for Voorhees. This is MFC 18. Our CC 88641 was MFC 17. Quadripartite meeting convened at French Headquarters at 1200 hours and lasted six and one half hours. French chairman summarized position reached night before, that both sides wished written assurances, but that no agreement could be obtained as to terms of such assurances. He suggested as solution that we note that both sides consider they have lifted restrictions, and that we note the verbal assurances given in connection with present discussions, including the assurance that both sides are prepared to enter into a clearing agreement, British representative pointed out that such clearing arrangement would be concluded by Germans and that military government would only give guidance. Soviets replied that we were to inform CFM of our agreements and disagreements. We stated our instructions were only to conclude our negotiations, and Soviets agreed that this was more accurate. US representative then repeated general terms of French suggestions, that we accept mutual verbal assurances given, assume that all is well, and go about the business of restoring normal conditions without further talk. Soviets preferred to discuss individual items, so considerable time spent on our first two documentation items.2 Soviets then suggested we accept their language, to effect that as regards documentation of goods moving to and from Berlin, 1 March 48 procedures would apply. US pointed out that if assurances were to be given in such general form, we could simplify our task by agreeing on following statement:
‘“The Soviet delegation stated: The movement and documentation of goods to and from Berlin is handled in accordance with the procedures in effect on 1 March 48.
The US, UK and French delegations stated: Germans of the Soviet and of the Western zones are free to purchase and sell goods in interzonal trade, as was the case on 1 March 1948. [”]
Each delegation believed that its own assurances were sufficient, without further elaboration. However, each delegation felt that such elaboration of the other delegations’ [assurances was necessary and this held up the?] show for several minutes. When Soviets began to talk they seemed uncertain and ill at ease. They asked whether this meant that 1948 trade agreement would be revived. We replied it meant just what it said, and that since they insisted we be content with their statement regarding documentation with no elaboration as to its meaning, they must not ask us to be specific about ours. They did not appreciate the application of their own tactics, and said we were wasting time. We spent quite a long time with the Soviets asking us to make our statement read the same as theirs, namely, that the conditions and procedures in effect on 1 March 48 would apply. We denied their right to criticize our statement or to ask for elucidation, since they refused us such rights in regard to their statement. Soviets claimed our unwillingess to use their wording was evidence of our determination to avoid returning to conditions which governed trade on 1 March 48, i.e. those of the 48 Trade Agreement, and that we were thereby violating the provisions of the New York Agreement.3 We rejected this thesis, stating that any impartial person reading our statement would be forced to admit that it effectively lifted all restrictions imposed since 1 March 48, Soviets insistently pressed for elucidation of what we meant, saying that without further explanation our statement was not satisfactory. We replied that our proposed three paragraph agreed statement made it plain that no one was satisfied with what the other fellow had said but that it did accurately reflect the status of our negotiations, and this was all it was intended to do. Soviets then insisted on return to individual detailed points. British representative emphasized importance we attached to satisfaction on our second documentation point—export from Berlin—and said that if we could settle that, we might be able to reach satisfactory agreement all around. He admitted right of Soviets to feel concern about possible drain of Sovzone resources through Western sectors, but said their method of dealing with this problem was all wrong. They should either impose internal zonal controls, or set up method of joint control of specific items. US did not think much of this latter idea, since Soviet veto would be sure to appear, but did not voice dissent, since other stipulations suggested by British made proposed procedure too offensive to Soviets for them to accept. However, British text was taken by Soviets for study tonight. It reads:
“In respect of goods and [products?] which the Soviet authorities determine are in short supply in their zone, a common procedure will [Page 810] be agreed upon between the Soviet and the Western authorities for the licensing of such goods or products for export from the Soviet zone and sector and for export from the Western sectors of Berlin. The procedure will be operated by the Soviet authorities in their zone and sector; and by the Western Authorities in the Western sectors.”
US then asked what approach seemed most likely to succeed, (1) List of detailed assurance on both sides, (2) US proposed general statement, (3) Specific agreement regarding Berlin exports, in return for specific clearing agreement. Soviets objected to using clearing agreement as bargaining point, claiming that there could be no pretense of compliance with New York agreement without one. US pointed out this was obvious fallacy, that proceeds of Sovzone sales in Western zones could be used to buy West zone goods, and vice versa. Soviets said maybe so, but it would be unhealthy trade and would hurt chances of general German economic recovery. We said this was hardly the issue, the Soviets had claimed we had violated NY agreement because trade would not flow without clearing arrangement, and now they admitted this was not so, but wanted us to help protect their currency, which was hardly a part of the NY agreement. Meeting ended on this note, and will reconvene at British Headquarters at noon 13 June, with stipulation we must agree or disagree within 4 or 5 hours. Soviets have been jolted out of their fixed positions, and previous carefree, disputatious attitude, which we believe stemmed from instructions to sit tight and concede nothing, has disappeared.
Have seen your CFM 9 [59?] of 12 June [and] Telecon4 with Dorr. Can assure you that there is no chance that Soviets will comment one way or another on our summary of their position. Therefore plan to press for agreement along lines of alternatives (2) and (3) of second paragraph above, and in default thereof, to despatch to you summary of points put forward on each side, and respective positions taken. While no grounds for optimism, situation is considerably more fluid than yesterday.
- Not printed; in it Wilkinson had reported briefly on the June 12 meeting in Berlin. (Department of Defense Files)↩
- Under reference here are the first two points of the agreed Western paper concerning restrictions on trade, transport, and communication with Berlin, which was transmitted in FMPC 1070, May 31, p. 801.↩
- See editorial note, p. 750.↩
- Neither found in the Department of State files, but see CFM 60, infra.↩