London Embassy Files: 500 Marshall Plan: Telegram

The Deputy Chief of the Economic Cooperation Administration Mission in the United Kingdom (Siegbert) to the Embassy in France


Torep 519. Ref Caffery tel SecState, 247 rptd London 57 Jan 19,1 Paris Repto London 287, rptd Dept Eepto 2381.2 Show Finletter and Moffat.3

Have been pressing Brit to place under export control those 1A [Page 71] items on which agreement has been reached. Brit have drawn up their own list which covers one hundred one out of one hundred sixty-one items on US 1A list. Items not on Brit list are either still under consideration by Brit Working Party or are not being recommended to Cabinet for export control. Brit list follows by air pouch.
Although Brit now agree that more than one control order may be necessary, before taking any action they wanted discuss common approach with other countries given 1A list by US. Initial consultation held Jan 17 at informal meeting in Paris outside OEEC framework called by French at Brit suggestion and attended by Italy, Netherlands, Belgium, Sweden, Switzerland, France and United Kingdom. Bizone not invited because (a) Brit feel this subject one for agreement between Bizone authorities and Washington and London, and (b) French and Brit felt other countries would be more reticent if American present.
At meeting Brit took lead in urging all countries approach 1A problem as a common security matter as well as in security interest each country. Brit gave other countries copies their draft list and explained consultation continuing on those items not yet agreed.
Brit indicated other countries in general anxious that control of 1A items not be considered by iron curtain countries as declaration economic warfare and are therefore most desirous handling matter discreetly. (Brit, however, informed us Poles well aware of list and in fact practically asked Brit for copy during trade negotiations just completed.) Without specifying reactions individual countries Brit stated there were three categories of reactions: (a) countries like France which agreed with Brit that each country should agree on its own 1A list in consultation with US, recognizing such action to be in its own security interest as well as broader mutual Western European security; (b) countries which wanted merely to accept US 1A list as information and guidance without further consultation ECA missions and without necessarily taking steps control all items; and (c) countries which approach subject in very circumspect fashion without agreeing to any firm line of action. Italian rep apparently not informed measure of agreement reached with his govt.4 Brit reported he was almost inaudible and talked only about recent Italo-Soviet trade agreement.5 Although other countries agreed this subject not [Page 72] one for exploration within OEEC framework, Netherlands and Belgium had received US 1A list so recently that reactions of their Paris reps were somewhat tentative. Brit was asked not to take any action in making public their list (which must be done when Brit puts items under export control) until other countries had time consider list and consult further. Brit meeting with French again Jan 26 preliminary to next meeting with other countries scheduled Jan 29. Brit will report results those meetings to us Jan 31.
In light reactions expressed at initial consultation Brit, while reserving complete freedom of action, told other countries they would consult us before deciding whether to place agreed items immediately under export control or accede wishes other participating countries and delay until further informal consultation with other European countries can be had. Brit reasons for further delay are: (a) by taking leadership as they are now doing and consulting further with other European govts before putting their list under formal export control it may be possible to secure more uniformity in other countries’ list; (b) publication of Brit list now would inevitably restrict scope of negotiations between other countries and ECA since Brit current agreed list shorter than US 1A list; (c) publication Brit list in advance of further consultation and in advance of other countries applying controls may prejudice Brit future competitive status re trade negotiations with Eastern countries. Re (c) we pointed out Italians already were applying controls hence Brit would not be alone if list were laid before Parliament soon. Brit indicated clearly their feeling Italian controls would actually be only partially effective irrespective of any decrees on paper.
Brit now awaiting OSR and Washington reaction as to whether achievement of 1A security aims would be assisted by having Brit delay applying controls until other countries further along. Our tentative feeling is that delay up to four weeks might prove helpful provided Brit continue leadership with other countries, ECA consultations with other countries can advance, and other countries make effort catch up with Brit. Delay beyond four weeks would only cause footdragging by countries concerned. Concur that common consultations while helpful should not be used as excuse for procrastination and had already made this point clear to Brit. Brit most anxious that US not view such consultations as delaying tactic and appear more prepared to take leadership in encouraging other countries go along with common approach than they were several months ago.
Ref Torep 331 reptd Toeca 404 Nov 12,6 Brit still feel they must issue parliamentary order as statutory instrument which will undoubtedly [Page 73] raise questions in Parliament. FonOff insistent that no hint of discrimination be contained in published order but MOS and BOT feel administrative burden required by examination of export license applications irrespective of destination would be impossibly heavy and therefore wish to reduce number of examinations required. In effect this would be done by requiring licenses for all destinations but at same time or shortly after statutory instrument published by issuing supplemental order specifying that open licenses would be issued for certain named destinations such as Commonwealth, Western Hemisphere and OEEC countries. Brit will further consider details of control methods and keep us informed.
Because of difficulty of precise definitions Brit may control some few items through administrative action direct with manufacturers or exporters instead of requiring licenses. In these cases Brit want it clearly understood that such administrative controls may not prove 100 percent effective although in fact we are assured this type of control almost as effective as license requirement.
Ref para 3 London Repto 287 reptd Dept Repto 23817 Brit were told Italian concern and feel presence Italian rep at Paris meeting sufficient to ensure Italian Govt knowledge Brit attitude on 1A list.
ECA please pass State. OSR please pass appropriate country missions.

Sent Paris Torep 519, rptd Washington Toeca 616.

  1. Supra.
  2. Not printed. It reported that Alphand explained the delay in French acceptance of the 1A and 1B lists was attributable to consultations currently being conducted between the British and the French working toward a common policy (ECA Telegram Files, Lot W–130, Paris Repto).
  3. The reference here is to Thomas K. Finletter, Chief of the European Cooperation Mission in the United Kingdom and Abbot L. Moffat, Chief of the Trade Division of the E.C.A. Mission, who were presumably in Paris.
  4. In the autumn of 1948 the Italian Government expressed its willingness to cooperate fully in the program to control exports to Eastern Europe.
  5. An Italian-Soviet Treaty of Commerce and Navigation together with agreements on trade, payments, and reparations was signed in Moscow on December 11, 1948. Materials on the concern of the United States with respect to these agreements are presented in Foreign Relations, 1948, vol. iv, pp. 489 ff.
  6. Not printed.
  7. Paragraph 3 of the message under reference (see footnote 2) reported that American ECA officials had been informed that the Italian position would be buttressed if the British Ambassador in Italy could unofficially communicate to Italian officials the British willingness to concert their efforts toward the achievement of a common policy.