Foreign Relations of the United States, 1955–1957, Western Europe and Canada, Volume XXVII

166. Memorandum of a Conversation, Department of State, Washington, June 29, 1955¹

Washington, June 29, 1955

SUBJECT

• P.L. 480, GATT, Scandinavian Union

PARTICIPANTS

• Mr. Arne Skaug, Minister of Commerce, Norway
• Mr. Johan Cappelen, Economic Counselor, Embassy of Norway
• Mr. Waugh—E
• Mr. Frank—ITR
• Mr. Stanford—BNA

Minister Skaug’s visit was in the nature of a courtesy call. While the discussion touched upon a wide range of subjects, the principal points of interest were the following:

P.L. 480

Minister Skaug explained that Norway is dependent upon imports for 80 per cent of its bread grain requirements. Recently they were negotiating with the Russians for wheat, but the Russians were insisting on substantial amounts of aluminum in return. The negotiations became deadlocked when Norway indicated its inability to supply the aluminum because of a hydroelectric power shortage. At the same time Norway was considering importing 150,000 tons of wheat under P.L. 480 but found it politically impossible to do so because of the 50/50 shipping requirement.² When the Russians heard about this, they broke the deadlock on their own negotiation and agreed to provide a substantial tonnage of wheat to Norway in return for salt herring, which the Norwegians would have had great difficulty in disposing of elsewhere, and whale oil. Both the Minister and Mr. Waugh remarked at the alertness of the Russians to capitalize on tensions generated by restrictions such as the 50/50 shipping clause.

GATT

The Minister indicated that Norway would find it difficult to meet the deadline of August 1 for their request list from the U.S. for the fourth round of tariff negotiations. They will, however, make every effort to do so. The Minister explained how Norway obtains the views of interested business groups on tariff matters through official consultations with trade associations.

Scandinavian Union

In connection with a discussion of regionalism in Europe, the Minister made reference to the fact that there had been a Scandinavian Customs Union in the late 19th Century and that there still is talk from time to time of some kind of economic integration on the part of Norway, Sweden and Denmark. When inquiry was made as to whether Finland is considered in such planning, the Minister remarked that while they would welcome participation by Finland, it was recognized that Finland’s delicate position vis-à-vis the Soviet Union would preclude formal overt cooperation of this kind.

1. Source: Department of State, Central Files, 411.5741/6–2955. Official Use Only. Drafted by Isaiah Frank on July 5.
2. Reference is to the requirement in P.L. 480, the Agricultural Trade Development and Assistance Act of 1954 (68 Stat. 454), that one-half of the U.S. agricultural surplus being sent to a particular country be carried in American bottoms. Details of U.S.-Norwegian negotiations on P.L. 480 are in Department of State, Central File 411.5741.