Foreign Relations of the United States, 1955–1957, Foreign Aid and Economic Defense Policy, Volume X

171. Letter From Foreign Secretary Lloyd to Secretary of State Dulles¹

London, May 25, 1957.

Dear Foster: I returned from Denmark this morning and have been discussing with Harold and other colleagues the question of China Trade Controls. Like you I am very anxious to find a basis for agreement. I feel, however, that to reach an agreement which would not in substance abolish the differential would mean continued bitterness and recrimination in this country. As you know to differentiate between China and the Soviet Union seems wholly illogical to every shade of political opinion here. If we now make an agreement maintaining the differential we shall be under constant pressure to take the matter up with you again and considerable harm could be done to our good relations. Therefore, we feel that it is right to grasp the nettle now. Quite frankly the two compromises put forward in the committee this week leave the differential in existence and affect a number of items regarded by our exporters as of the essence of the problem. Therefore we have decided that our line at the meeting on Monday² will continue to be that the differential should be abolished. In an effort, however, to help, we shall tell the Committee that we will willingly cooperate to see that quotas so far as certain items subject to quantitative control are concerned are kept as low as possible. There can be detailed discussion about these items between officials. Secondly, we will say that we will seek to speed up the watch procedure for items on the Watch List. We will certainly co-operate in seeing that the China Committee has full information rather more speedily than has been the case in the past over Watch List items for Russia. I am afraid that this decision will be unpalatable but I believe that it is the only basis upon which we shall keep any system of strategic controls generally accepted and working in practice.

I am most grateful to you for your personal efforts to try to work out a basis for a compromise and I know that you will do your best to limit the reactions to our decision in the United States. We too will try to do all we can to play down this difference of opinion.³

1. Source: Department of State, Central Files, 493.009/5–2557. Delivered to the Department by Coulson on May 25. Following delivery of the letter a brief conversation took place between Coulson, Armstrong, and Wright. The source text was attached to a memorandum of that conversation, drafted by Wright.
2. May 27.
3. The source text is not signed. The Department transmitted a copy of this letter to the Embassy in telegram 8268 to London, May 25. (Department of State, Central Files, 493.009/5–2557)