330. Telegram From the Delegation at the Foreign Ministers Meetings to the Department of State 1

Secto 187. East-West trade. Fourth session Trade Working Group took place today. Goodkind in chair.

French Rep asked for more contacts between French and Soviet traders. This especially needed because of different systems with differing methods and requirements. Asked greater freedom Western businessmen live and travel USSR. Also, as particular matter Franco-Soviet economic relations, asked Soviet Trade authorities reconsider practice selling exports c.i.f. and buying f.o.b., thus depriving Western firms opportunity participate insurance and shipping business.

UK Rep supported proposal facilitate contacts of Western businessmen, mentioning also difficulties occasioned for smaller traders because unrealistic ruble exchange rate. As separate proposal pointed [Page 691] out Soviet lack adequate protection industrial property rights real deterrent to trade.

US Rep associated self with French and British statements concerning business representation in Soviet Union, exchange rate and industrial property rights. Elaborated on patent problem, particularly respect right of priority and exchange patent data. Made long statement calling on USSR make available more information on production, markets and foreign trade. Reserved right make certain proposals civil aviation later when question which appropriate working group clarified.

Soviet representative then made extended speech attempting show again that Western strategic controls only obstacles to trade worth discussing. Obstacles mentioned by Western reps could hardly account for lack of interest Western businessmen visiting USSR. Recalled 1952 Moscow Economic Conference to which large numbers Western businessmen invited. Majority Western businessmen, particularly in US, did not respond because of political atmosphere in West and because the regimes for controlling trade made discouraging statements.

Similarly interest Western firms in Russian furs has been discouraged even though furs of such high quality that if situation reversed West would put on embargo lists. Businessmen now regard trips Moscow dangerous their reputations especially if later applying for visas enter certain Western country. Despite such discouragement Soviet Govt gratified number Western businessmen particularly British and French visiting Moscow constantly increases and reached total 758 in 1954. (Note: Can Dept supply figure approximate number foreign businessmen entering US in 1954?)

Cheklin cited instance British firm prosecuted for attempting send 100 tons lead to USSR. Thought lead was peaceful goods in international trade. There is even a metals exchange London to facilitate international trade metals like lead. Before coming Geneva Cheklin canvassed Soviet foreign trade organizations for instances obstacles to peaceful trade other than strategic controls. Not one mentioned such matters as patents or other matters raised by Western reps. However Soviet trade organizations had many letters in files from American and other Western businessmen regretting inability fill Soviet orders on account of strategic controls. One example cotton picking machinery, export of which US Commerce Dept said would be contrary national interest.

Cheklin read several such letters in English and concluded they prove real obstacles peaceful trade are strategic controls. Said not talking of tanks, guns, atom bombs, which no one wanted to buy but of peaceful goods such as those mentioned.

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Meeting closed with UK Rep’s plea for discussion of topics other than strategic controls which outside term of reference. Cheklin said strategic controls did not hurt USSR which would buy elsewhere or produce at home but if experts were to discuss removal of obstacles peaceful trade the only way to do this was remove obstacles and discriminations on Western side.

Next meeting Tuesday morning.

  1. Source: Department of State, Central Files, 396.1–GE/11–555. Confidential. Repeated to London, Paris, Bonn, Moscow, and the Mission at the United Nations. The meeting took place at 11 a.m.