Foreign Relations of the United States, 1958–1960, Western Europe, Volume VII, Part 2

232. Memorandum of Conversation⁰

Rome, December 23, 1958.

PARTICIPANTS

• The Hon. Amintore Fanfani, Prime Minister
• Minister Raimondo Manzini, Diplomatic Adviser to the Prime Minister
• Ambassador Zellerbach
• Minister Carlo De Ferraris, Secretary General, Foreign Office
• Minister Enrico Aillaud, Chef du Cabinet
• Mr. Vincent Barnett, Economic Counselor
• Mr. H. G. Torbert, Jr., Political Counselor

(The above four were not present during the conversation on internal political and military questions.)

Fanfani arrived quite late, having attended various ministerial meetings at which he said he had satisfactorily established the Italian position on the Common Market question and had also finally settled the question of Finance Minister Preti’s resignation,¹ which would be withdrawn for the present. [3 lines of source text not declassified]

Begin Confidential

Common Market

During lunch, the conversation turned generally to Common Market problems. Fanfani was asked his general impressions of the recent meetings, as well as his estimate of the outlook for the Common Market and Free Trade Area difficulties. He replied that the OEEC meetings had not been as well prepared as the NATO meetings and that there was considerable confusion. In particular, he thought that the six countries of the Common Market had not sufficiently coordinated their own position. At one point a reference was made to the “six” at which Fanfani smiled wryly and commented that the trouble was on these discussions there had been seven instead of six representing the Common Market. He went on to say that there had been really two Germanies at the meetings: the Germany of Erhard generally supporting the British position and Germany of Adenauer generally supporting the French position. Since both the UK and France thus gained the impression that Germany was on their side, this resulted in a stiffening of the two opposing parties which made progress very difficult. The Prime Minister indicated that he thought the situation had reached a point of considerable gravity. He was asked whether the big four countries were likely to meet on January 15 as had been suggested to try to work out some of these problems, and he replied that he thought this meeting would not now take place, since De Gaulle preferred to maintain the integrity of the Six as a negotiating unit.

PL–480

I told the Prime Minister that in the light of my recent trip to Washington, it was clear that there could be no renewal of programs like the rural assistance program which had been undertaken last year. Fanfani did not seem surprised and made no strong pitch for such a program. I then went on to say that, in fact, there was considerable question whether there would be any programs under PL–480 for Italy. When Fanfani inquired as to the reasons for this, I gave him the substance of the position contained in Deptel 2168,² pointing out especially Italy’s strong economic position and her very large reserves of gold and dollars. Here again, Fanfani did not seem especially surprised, and even expressed himself as being in agreement that under present circumstances Italy apparently did not need this kind of assistance.

End Confidential

Begin Secret

Politico-Military Matters

In a private session after lunch I asked Fanfani whether my understanding was correct as a result of the meeting with Secretary of Defense McElroy³ that the Italian viewpoint was that the limit of their possible expenditure for operation and maintenance of the IRBM’s was five to five and one-half billion lire per year. They understand that the US could not commit itself in advance to financing any excess over this cost, and would be satisfied if the US would make a commitment simply to study sympathetically Italian needs in this regard if and when they arise. He confirmed this understanding.

[1 paragraph (12–1/2 lines of source text) not declassified]

Internal Political Situation

Turning to the situation of the government, Fanfani indicated that some realignment was obviously badly needed but it was not feasible to do this until after the PSI Congress because many elements do not wish to take a position before that time for fear of prejudicing the outcome. He believed that the government could be held together if it were cautious about forcing issues, until an orderly realignment could be made.

I mentioned that I had had a visit from Malagodi⁴ on the previous day and he had informed me that the PLI would be willing to enter a quadripartite government formula provided the DC would give certain assurances that they were not contemplating a premature alliance with Nenni and that they maintained a firm Atlantic foreign policy. Fanfani expressed interest and assured that they had no intention of making any immediate advances to the PSI and in fact he doubted very much if Nenni would succeed in making a definite break. On the question of foreign policy he expressed appreciation for the confidence expressed in my San Francisco speech and said that he felt there was no problem of providing adequate assurances to PLI in this regard. In general he thoroughly agreed and accepted the formula regarding a quadripartite made by Scelba and espoused by Malagodi.

[2 paragraphs (11 lines of source text) not declassified]

Mattei’s Visit to Russia and China

Returning to the larger group, I commented that one of the things that was troubling us was the effect of the visit by Mattei to Moscow and Peking, particularly at this time. The Prime Minister said that this was causing him considerable concern. He commented that he thought Mattei still wanted most of all to reach some understanding with American oil companies. I said this was not the point of my observation since the relationships between Mattei and the American oil companies were something for them to work out, and since I was fully convinced that the American companies could take care of themselves. In fact, I said that I was not commenting on the business or commercial aspects of the visits so much as on the political repercussions. I said it seemed strange to me that a trip like this would be allowed to take place at the same time that the NATO meetings were going on, and shortly after there had been considerable discussion in the press and otherwise with respect to the basic foreign policy objectives of the Fanfani government. I suggested that this made it more difficult for those who were defending the proposition that the present government was firmly pro-NATO in its orientation.

The Prime Minister said that Mattei had come to him just a day or so before leaving, and that this was the first that he (the Prime Minister) had known about the trip. Mattei had proposed to go first to Moscow and then on to Peking in order to look for trade opportunities, and especially for opportunities to dispose of drilling equipment and synthetic rubber. Fanfani said he had asked Mattei, if he could not postpone the trip, at least to go directly to Peking without stopping off at Moscow. Mattei had at first said it was impossible, then had agreed. Fanfani commented that he thought Mattei had some legitimate trade purposes in mind, and added that according to Mattei he had been pushed into turning eastward by the Americans. The Prime Minister explained that Mattei felt he had been out-bid by Americans for European markets (notably France) for the synthetic rubber being produced by his Ravenna plant, and that piling up of stocks forced him into looking for other outlets. This resulted in the deal with the USSR and in the exploration of possible outlets in China. I commented that an American businessman undertaking to trade with the Chinese Communists would find himself in serious difficulty with his own government. The Prime Minister said that aside from the agreement to stop exports of strategic materials on the international list, there were no laws to prohibit Italian businessmen from seeking outlets in Russia or in China. I said that if this had been simply a case of straight private industry looking for trade arrangements, I certainly would not have raised it with him. In this case, however, we are talking about a parastatal agency which is widely regarded as synonymous with the Italian government. Public opinion certainly can make no distinction between ENI as a public agency and the policies of the existing government. [3 lines of source text not declassified] He said, however, that it would not be possible or desirable to put more restrictions on the trading potential of government companies than on their privately-owned competitors. I pointed out that if Mattei had sent some subordinate official of ENI to conduct these explorations, the problem would be much less difficult. It was not only that ENI was involved in this activity but that Mattei himself, a man of considerable prominence, chose to go and chose to extract the utmost publicity from the trip.

[2 paragraphs (36 lines of source text) not declassified]

End Secret

Begin Confidential

Visas for American Missionaries

As a final item, I raised with the Prime Minister the problem of visas for American Protestant missionaries which I said was a major political problem to us. There are many Americans, I said, who could not understand why Italy adopted such a rigid policy of excluding a handful of Protestant missionaries especially in view of the large number of Catholic clergy who were given visas to the US. Fanfani expressed surprise that this was a current problem and promised to give early favorable consideration to any individual cases which the Embassy might bring to his attention. Mr. Torbert attempted to suggest that it would be better to establish a principle of action even if only for a limited number of people than to make it necessary to deal on a high level on a case by case basis. However, Fanfani indicated that a case by case basis was the only feasible procedure in view of the many elements of opposition he had to overcome within his own government.

End Confidential

0. Source: Department of State, Central Files, 765.13/12–2958. Secret—Except As Otherwise Indicated. Drafted by Barnett and Torbert, partially from Zellerbach’s notes. Transmitted to the Department of State as an attachment to despatch 765, December 29.
1. Luigi Preti resigned on December 17 in protest over a report issued by a parliamentary commission investigating allegations of banking mismanagement.
2. Telegram 2168 to Rome, December 16, noted that although the U.S. Government was sympathetic to Italy’s request for aid, the Italian economic position was too strong to qualify for P.L. 480 assistance. (Department of State, Central Files, 411.6541/12–158)
3. See Document 230.
4. No record of this conversation has been found.