56. Telegram From the Department of State to the Embassy in Poland 0

1368. We informed Drozniak and Lychowski April 12 our readiness conclude immediately amendment Dec 15 agreement providing Title I sale 92,000 bales cotton and 10,000 MT rice. Sale conditioned on Polish agreement purchase in US with own resources 46,000 bales cotton and 10,000 MT rice. Also informed them we unprepared consider at this time grain and other commodities requested Feb 20 but expect be able [Page 117] begin discussions about June 1. Stated that in meantime Embassy Warsaw would be instructed raise with Polish Government certain matters of concern such as questions publicity and dollar bonds. Noted that PL 480 negotiations must be viewed in totality our relations. Extent to which problems cited above affect our relations cannot fail be weighed in consideration PL 480 matters.

Drozniak appreciative cotton decision although noting hope for larger amount. He expressed concern delay re grain pointing out last year’s crop overestimated. Late spring and insufficient deliveries from peasants aggravating grain problem. Indicated his intention seek acceleration negotiations on grain. Dept representatives were not encouraging on this score.

Re publicity Ambassador stated no problem since he discussed matter during Warsaw consultations and was assured adequate publicity would be forthcoming. We noted statement and observed this would ease our Embassy’s task. Re bonds he questioned usefulness Embassy raising matter since Polish attitude not negative. Problem was one of finding resources to pay obligations. This would be facilitated by credits for purchase export generative equipment. Dept representatives emphasized importance attached resolution bond problem, indicating in response Drozniak question that our desire for satisfaction publicity and bond matters one of several factors leading decision defer consideration grain and other commodities until June 1.

Instructions being pouched April 16 will deal matters to be raised by Embassy.1

  1. Source: Department of State, Central Files, 611.4841/4–1362. Confidential. Drafted by Katz and approved by Blumenthal.
  2. Not found.