Foreign Relations of the United States, 1951, European Security and the German Question, Volume III, Part 2

462A.62B31/9–151: Telegram

The Director of the Berlin Element of HICOG (Jones) to the Liaison and Political Reporting Division, at Bonn¹

secret   priority

Berlin, September 1, 1951—3 p. m.

148. Verbatim text. Following is text BK/AHC(51)82 dated 1 September, 1951:

“Subject: East/West trade situation, to: Secretary General, Allied General Secretariat.

1. CDTs (US and Fr represented by deps) held special session 31 Aug to consider, as requested, council’s proposal of 30 Aug re next move in Berlin East/West trade situation.²

2. Brit CDT felt that to concede signing of IZT agreement merely on basis proposed unilateral letter by Kaumann wld certainly be represented as withdrawal from position publicly taken by HICOM in press release of 26 July, 1951.³ It wld not discourage Russians from future action which wld lead to deterioration of Berlin situation. In short term he felt it wld give away, without satisfactory compensating assurances, our strongest weapon. He considered East was suffering and wld continue suffer more than West from stoppage of trade, and pointed out psychological and practical difficulties of abrogating current agreement.

3. CDTs then considered alternative plan, suggested by econ advisors, which consisted, in effect, of terminating Kaumann–Orlopp discussions as futile, and HICOM instead approaching Chuikov with proposal for quadripartite talks re problems posed by suspension East/West trade. If Sovs refused or delayed acceptance, more severe countermeasures to be imposed in about one month. If they accepted, West to seek firm assurances from Sovs re confiscations and other restrictive measures as well as re proof of origin issue. Shld talks fail, consideration to be given move such as Council proposal of 30 Aug. If resort to latter necessary, West Germans to be given to understand that flow of goods to East must be suspended immed if Sovs re-impose restrictions which HICOM considers warrant such action.

4. US suggested if quadripartite talks undertaken and unsuccessful, subsequent signing IZT agreement on basis unilateral declaration by West wld not put West in very strong position. Pointed out time and effort already spent in vain haggling, and said there were certain advantages to be drawn by “cutting the Gordian knot” with some definitive action now such as Council proposal. Also mentioned possibility that proposal for quadripartite talks might only strengthen probable Sov fear that Western powers, especially US, do not intend permit trade agreement in any case, and merely using delaying tactics.

5. After considerable discussion pros and cons of situation, CDTs agreed that, aside from Council proposal, there were following possibilities:

(a) Plan outlined para 3 above;

(b) Sign agreement now as proposed by Council, but instead of sending Kaumann letter to Orlopp, that Council write letter along same lines but in stronger and more precise terms to Fed representative, with copy given Orlopp by Kaumann;

(c) Suspend East/West Ger talks and take no action for 30 days, thereby showing Russians we confident in strength our position;

(d) HICOM write letter to Chuikov, stating since East/West Ger negotiations proved unfruitful, HICOM is prepared authorize signing of agreement if assurance received from Chuikov that current Berlin trade difficulties will cease. Letter wld offer keep this exchange of correspondence confidential if Chuikov wished.

6. In view of all the circumstances, the Brit and US CDTs agreed to recommend (d) above.

7. The Fr CDT agreed with HICOM solution; he considered, nevertheless, that it was preferable that the document to be handed to Orlopp by Kaumann shld be copy of letter by which HICOM wld inform FedRep that it authorizes the latter to sign IZT, repeating statement of allied point of view as given in original text. Fr CDT, therefore, approved (b) above. He considered that we shld avoid giving Sovs grounds for thinking that Western powers have no intention of signing IZT. He was completely against (c) above which wld give Sovs and East Germans impression that East Germany was to be blockaded and which wld be interpreted as a rupture, which might result in a total blockade of Berlin. If, however, the signature of IZT were not to take place immed, Fr CDT considered that (d) above wld be the least dangerous. He observed that, in any case, if allied conversations were to take place with Sovs, they shld be on Berlin level, the CDTs having, in fact, laid down the principle, in their letter of June 11, 1951 to Mr. Dengin,⁴ that the right of decision in matter of export documents or movement of goods belongs to sector CDTs. The question at issue was that of control over industry, which belongs to the exclusive competence of Berlin CDTs. (Brit and US CDTs considered that since quadripartite talks wld presumably be concerned primarily with East-West trade which lies within competency of HICOM, not CDTs, talks shld be on HICOM level. (Signed Gaugain, Chairman Secretary).”

Jones

1. Repeated to Frankfurt and Washington. The source text is the copy in the Department of State files.
2. At its 74th meeting on August 30 the Allied Council agreed that, in view of the failure to agree on identical letters to be exchanged between the East and West Germans at the signing of the interzonal trade agreement, the Federal Government should be authorized to sign the trade agreement and at the same time forward it to Orlopp stating the conditions under which the agreement would be carried out. Bonn reported on the meeting in telegram 143, August 30. (398.10–GDC/8–3051)
3. Not printed, but see telegram 73, July 26, p. 1857.
4. Not printed, but see footnote 2, p. 1857.