394.31/9–651: Telegram
The Acting Secretary of State to the Embassy in Italy
priority
1103. Ur 1108 and 1094.1 US does not intend withdraw from Italy or others any concessions initially negotiated with Czecho in withdrawing benefits trade-agreement concessions from Czecho. So informed Ital Emb here today.
Re felt hats,2 US keeping position under continuous review per working party report. Fact that Czecho wld not benefit from concession if reinstated will be taken into consideration in this review.
Re cheese, repeal Section 104 being sought. Meanwhile possibility excluding sheep’s milk cheese from quota still under consideration. Re almonds, Section 22 investigation at hearing stage. No certainty any action.3
Our latest info leads us believe UK will support waiver. Fr, Ben no final decision.
Proposed severance of obligations US and Czecho does not imply any CP siding with US. Fact is Czecho has singled out US as main target for hostile actions and has applied especially severe pressure against US as compared other countries free world. You shld inform Itals neither Norway nor Can both of which have indicated tentative support US position, believe such support wld require them follow similar course. Basis for action supporting waiver proposal as US will [Page 1401] present matter in GATT will be that irrespective of merits gravity of dispute is so great fulfillment trade commitments between US and Czecho impossible and they shld therefore be dissolved.