The Under Secretary of Agriculture (Morse) to the Under Secretary of State (Smith)

Dear General Smith: This is in response to your request for our comments regarding the feasibility of offering new concession items to Uruguay as some compensation to them for the United States decision to delay application of the duty concession on various beef items negotiated in 1949.

We have reviewed our situation with respect to these points. We can agree to your informing the Uruguayans that we would not object to a prompt withdrawal of the countervailing duties on wool tops imported from Uruguay as soon as the Treasury Department has found that subsidies are no longer being paid on such imports.

[Page 1575]

Also, we believe you should emphasize to the Government of Uruguay that action at this time to put the duty concessions on beef into effect would not be in their long time interest. First, Uruguay is not the major supplier1 of these items to the United States. Therefore, the benefit would have accrued primarily to the other supplying countries. Second, the establishment of lower rates would have increased pressure for restrictive action under import control legislation.

Sincerely yours,

True D. Morse
  1. The “principal supplier” rule was basic to the U.S. concept of multilateral tariff reduction within the framework of GATT.