693.0031/7–549: Telegram

The Secretary of State to the Ambassador in the United Kingdom (Douglas)

2320. New York Times July 2 carried story by Benjamin Welles dated July 1 London which summarizes purposes and progress US mission to London re control exports to China. Baltimore Sun July 3 carried similar story by Paul Ward datelined Washington July 2. Dept requests report any info re possible source London, any similar coverage Brit press, and reaction FonOff officials thereto if volunteered.

Fol excerpts from New York Times story:

“US Govt quietly seeking the support of its North Atlantic Pact associates and of the ‘free’ Asiatic powers for coordinated foreign trading policy vis-à-vis the Communist areas of China, was reliably learned here.

“Purpose of policy, it is emphasized, is not to pave way for early recognition of Chi Commie regime but, on contrary, to strengthen collective hand of non-Commie powers in trading with China and at same time to block future flow of strategic materials to Communist areas of Asia—including Soviet Union.…

“As chief ‘salesman’ for new program, US sent Edwin M. Martin, director of State Dept’s Office of International Trade Policies, to Europe about 2 weeks ago.

“Accompanied by three experts from State and Commerce Depts, Mr. Martin conferred here with Brit officials and then left for the Continent to discuss both Chi and Japanese economic affairs with the experts of France, Belgium and Netherlands.

“It is understood that when Mr. Martin first proposed to Brit the plans to draw up list of strategic materials to be banned from export to China his views met with a ‘cool’ reception. The Brit raised several objections, namely that international trade was now more than ever Britain’s life blood, that British traders had spent a hundred years in building up their position in Far East, that they had been severely [Page 865] hurt in the past 10 years and further restrictions at this time might send many of them to wall.

“The British were reported further to have pointed out that any attempt to ‘police’ international trade with China to prevent strategic materials falling into Communist hands would prove immensely difficult.

“US has not insisted on any hard and fast agreement thus far, it is said, but rather has asked the British and other Govts to turn over the matter in their minds and come up with some pertinent ideas.

“British have agreed to ‘go along’ with US but only if latter insists, and provided that the other trading countries cooperate and form a common front.”