62. Telegram From the Embassy in Poland to the Department of State0
48. Under Secretary Winiewicz today called me in and handed me aide-memoire MFN matter. This aide-memoire refers to discussions in both houses of US Congress which “have already adopted certain provisions which clearly aim at a return to cold war practices in trade and financial relations.” “As is well known MFN clause was restored by USG in November 1960 in conjunction with undertaking by Polish Government to start compensation payments in amount of 40 million dollars. This undertaking by PPR was in fact made conditional—on basis gentlemen’s agreement—upon granting by US of said clause to Polish exports. Government of PPR has been strictly discharging its obligations.”
Aide-memoire then goes on to argue at some length that present obligations already impose strain on Polish balance of payments and that rescinding of MFN “could prevent Poland from discharging her undertakings.”
In course of discussions Winiewicz pointed out that effect of drastic economic measures against Poland would be to cause a sharp worsening in Polish-American relations. He said MFN more important for Poland than PL-480. Such worsening of bilateral relations at moment when world outlook seemed to be perceptibly brightening would be very unfortunate. I said that though impression prevailed in US that Poland getting bulk of benefits from our economic relations and though some illusions regarding Poland had been shattered, I would consider it deplorable if there were to be sudden worsening of relations.
As Department aware (Embtel 2118 June 20),1 I feel strongly that we would be defaulting on moral obligation if cancellation of MFN for Poland should become law. Also considering fact that Poland, if MFN cancelled, probably would not and could not meet obligations, it would seem to me counter-productive from viewpoint our immediate interests to cancel clause. Even for those who believe that Poland should not have benefit of any favorable economic ties with the US, it would seem to me that this is wrong way to go about achieving desired result. I earnestly hope therefore that Congress can be persuaded to reverse itself in this matter.