Current Economic Developments, Lot 70 D 467
Current Economic Developments
No. 204
Trade Committee Established by Economic Commission for Europe
The Economic Commission for Europe concluded a successful fourth session in Geneva May 21 with formal establishment of a trade [Page 118] committee with terms of reference as proposed by the ad hoc committee.1 The US and the UK, followed with varying degrees of enthusiasm by other western European countries, opposed any change in the terms of reference, while the eastern European countries unsuccessfully attempted to place emphasis on industrial development.
Under its terms of reference, the committee is a consultative body to serve as a forum for discussion of and exchange of views on questions falling within its competence. It shall study, consult and submit recommendations on measures that will result in an expansion of trade between European countries and also between those countries and countries outside Europe. It will draw attention of the appropriate ECE committees to problems of agricultural and industrial development which are of importance to intra-European trade and shall collaborate as may be necessary with these committees in expanding production and trade. It has authority to approach the various UN specialized agencies in fulfilling its tasks. The committee shall not make recommendations leading to an infringement of the sovereign rights of any government, its task being to facilitate economic agreements between countries on the basis of equal rights and mutual advantages of the contracting parties.
US Speech on East-West Trade The Czech amendment requesting the committee to investigate US trade discrimination was defeated 11 to 6. In the course of discussion the US made a reply to a series of Soviet and Eastern European speeches which, although not as vitriolic as those at former sessions, were a critical attack on US trade discrimination and the European Recovery Program. The term “discrimination” became so consistently and closely identified with US export license policy that our delegation believed it necessary to make a statement correcting this impression. Our reply drew attention to the discriminatory practices of eastern Europe and stressed the point that our controls are essential to the acquisition and distribution of products in short supply.2 The speech was well received by most of the [Page 119] western European countries, but the eastern countries resented it and attempted replies. The Scandinavians and the Secretariat were unhappy as they considered the statement introduced a political element and they wished to avoid east-west issues. Certain press reports played up the statement as putting an end to the calm, conciliatory atmosphere which had previously existed in the session. While it undoubtedly added an extra day of plenary, our delegation did not sense any basic change in the atmosphere.
Evaluation of Roles of Member Countries Our delegation, in a post-session evaluation3 of the roles played by the various members, concludes that while the Soviets were less flamboyant in their criticism and some sources believe they were being conciliatory, an analysis of their remarks fails to show any fundamental change in their attitude. They apparently do not wish to destroy ECE but want to utilize it for propaganda purposes. There is no indication of any basic interest in or understanding of the work of any of the technical committees with the exception of the trade committee. Their chief objective at this session was to expand the trade committee’s terms of reference. The USSR and eastern European delegates repeatedly emphasized the desire for substantial expansion of east-west trade and the need for increased industrial development in eastern Europe as an essential prerequisite of trade expansion. Polish interest in the trade committee appears genuine, but it is not clear yet what the USSR interest is. It may be a recognition of inability to fulfill eastern European requirements from within the area; it may be a concession to the strong Polish interest in the trade committee; it may conceivably be a desire to expand trade with western Europe; or it may simply be a desire for another propaganda forum. Their motives should be clearer after the current session of the trade committee. Albania, Bulgaria, Byelorussia, Hungary, Rumania and the Ukraine were all faithful echoes of the USSR. Although voting with the USSR in all cases, Czechoslovakia and Poland seemed more independent than heretofore. Coordination between these two delegations and the USSR was lacking on several occasions. The Yugoslavs were in an uncomfortable spot on several occasions, but handled themselves with dignity and ability and apparently remained aloof from contacts with other eastern European countries. The Finnish delegate remained silent.
Our delegation believes that the Soviets made no gains at this session. The west gained the initiative and credit for a constructive approach. The unemployment discussion boomeranged on the Soviets as a result of effective speeches by the French and British representatives. The [Page 120] US set the discrimination issue in its proper perspective and this was clearly disconcerting to eastern Europe. The OEEC countries effectively refuted eastern charges against EKP and stressed the benefits of the first year’s operations. There was greater solidarity and cohesion manifest in OEEC ranks than in any previous session. Leading roles were effectively assumed by the British and the French. The Scandinavians took the floor frequently but did not function as a bloc and were not particularly effective. Norway and Denmark were much less willing to compromise than Sweden, which was the most frequent outlet for the Secretariat’s compromise proposals. The Benelux and Swiss delegations were ably led.
The general attitude toward ECE seems to support the concept of a regional economic forum in which the east and west discuss problems of mutual concern but members tend to be more critical of specific undertakings. All countries recognized the value of the ECE survey; all express respect for the work of the transport and coal committees. Most were hopeful that the trade committee will be useful, but several countries are dubious of the future work of certain other technical committees now that the short-term bottlenecks are broken.
. . . . . . . . . . . . . .
- The Fourth Session of the United Nations Economic Commission for Europe was held in Geneva, Switzerland, May 9–21, 1940. W. Averell Harriman served as the United States Representative at the session, and Paul R. Porter served as Deputy Representative. For the official account of the session and a description of the activities of the Commission and its subsidiary bodies during the preceding year, see United Nations Documents: Economic and Social Council, Official Records: Fourth Year, Ninth Session: Report of the Economic Commission for Europe, Supplement No. 12. A seven-page report on the session was submitted to the Department of State in airgram A–124, June 23, from Geneva, not printed (501.BD Europe/6–2349). For the text of Ambassador Harriman’s opening statement to the session on May 9, see Department of State Bulletin, May 22, 1949, pp. 651–653. Regarding the ECE’s Ad Hoc Committee on Industrial Development and Trade and the preliminary meetings in February 1949 of the Committee on the Development of Trade, see telegram 194, February 22, from Geneva, p. 83.↩
- For extracts of the summary record of the statement under reference here, made by Deputy Representative Porter on May 16 (Doc. E/ECE/SR.4/13, May 30, 1949), see Raymond Dennett and Robert K. Turner, Editors, Documents on American Foreign Relations, vol. xi, January 1–December 31, 1949 (Princeton University Press, 1950), pp. 194–196.↩
- The evaluation paraphrased and summarized here was sent as telegram 488, Noce 549, May 23, from Geneva, not printed (501.BD Europe/5–2549).↩