Foreign Relations of the United States, 1964–1968, Volume VIII, International Monetary and Trade Policy

262. Memorandum From the Special Representative for Trade Negotiations (Herter) to President Johnson¹

Washington, November 9, 1964.

SUBJECT

• Authority to Offer Tariff Concessions in the Kennedy Round

The purpose of this memorandum is to request that you authorize me, under the Trade Expansion Act of 1962 (TEA), to offer in the Kennedy Round tariff concessions within the limitations described below.

All the legal requirements of the TEA pertaining to such offers have been satisfied. In particular, both the inter-agency Trade Information Committee established under this Office and the Tariff Commission have held hearings on the public list of articles issued by President Kennedy last fall.² The results of these hearings were made available to you last spring and have been carefully reviewed by this Office and the other agencies concerned with the trade agreements program, most recently at a Cabinet-level meeting of the Trade Expansion Act Advisory Committee.³

With respect to non-agricultural articles, we have announced our readiness to table offers on November 16, but only if other key participants, and especially the European Economic Community, are prepared to do the same.⁴ Should they not do so, the United States offer of tariff concessions on these articles will not be disclosed to any participant in the Kennedy Round.

With respect to agricultural articles, we have been unable so far to reach international agreement on the basis on which offers of tariff concessions are to be made. Therefore, the offers to be tabled by the United States on November 16 will exclude agricultural articles. By approving this memorandum, however, you will authorize me to offer tariff concessions on agricultural articles at the appropriate time.

Any trade agreement which is negotiated on the basis of offers authorized by this memorandum and pursuant to the general negotiating authority already vested in me will be concluded subject to your final approval. During the negotiations, we may find it appropriate or necessary to hold back, reduce, or withdraw certain of these offers. On the other hand, it may become necessary for me to seek your authorization to offer additional concessions.

For your information, there is attached a detailed description of the background and important elements of the trade negotiations (Annex A).⁵

With the concurrence of the heads of the other agencies concerned, I now recommend that you authorize me, as your Special Representative for Trade Negotiations:

1. To offer under section 201 of the TEA a reduction of 50% in duties on all dutiable articles, with the following exceptions:

(a) Economic exceptions: Articles which should be partially or wholly reserved from a 50% reduction in duties in order to avoid the possibility of serious injury to domestic industries or the threat of impairing the national security (Annex A–1).⁶

(b) Mandatory exceptions: Articles on which the TEA prohibits the reduction or elimination of duties (Annex A–2).

(c) Technical exceptions: Articles on which a 50% reduction in duties cannot be made for one of a number of technical reasons: e.g., part of the TEA authority was used in the last round of trade negotiations (Annex A–3).

2. To offer the elimination of duties on the following articles:

(a) Articles with a duty of 5% or less which qualify for elimination of duty under section 202 of the TEA (Annex A–4).

(b) Agricultural articles which so qualify under section 212 of the TEA (Annex A–5).

(c) Tropical agricultural or forestry articles which so qualify under section 213 of the TEA (Annex A–6).

3. Where the reduction or elimination of duties is not proposed, to offer under section 201 of the TEA not to increase existing duties on dutiable articles or not to impose duties on articles now duty-free.⁷

Christian A. Herter ⁸

1. Source: Johnson Library, National Security File, NSC Histories, Kennedy Round Crisis, April–June, Tabs 1–6, Box 52. Secret. Drafted by John B. Rehm on November 9. The date November 10, 1964, is handwritten on the approved line at the end of the source text.
2. The Trade Information Committee, consisting of a chairman (appointed by the Special Representative for Trade Negotiations from his office) and officials designated by the Secretaries of Agriculture, Commerce, Defense, Interior, Labor, State, and the Treasury, held concurrent but separate hearings from those of the Tariff Commission. For further information, see U.S. Tariff Commission, Operation of the Trade Agreements Program, 16th Report, July 1963–June 1964 (TC Publication 164, Washington, 1966), p. 44.
3. No record of this meeting has been found.
4. See Document 260.
5. Annex A, not printed, outlined agricultural, nonagricultural, and nontariff barrier negotiations, procedures, U.S. exceptions, the nonparticipants rule (exclusion from negotiation of products, such as petroleum, of nonparticipants), scope of recommended exceptions, special authorities under the Trade Expansion Act for the President in certain circumstances to reduce tariffs by 100 percent, and participation in the negotiations mainly of countries adhering to the linear rule of 50 percent reductions, namely the EEC, Japan, the United Kingdom, Austria, Denmark, Finland, Norway, Sweden, Switzerland, the United States, and possibly Portugal.
6. Annexes A–1 through A–6 have not been found.
7. The tariff concessions which would become effective pursuant to a trade agreement concluded in the Kennedy Round would in no way affect the right of any industry, firm, or group of workers to seek escape-clause relief or other forms of adjustment assistance under the TEA. [Footnote in the source text.]
8. Printed from a copy that bears this typed signature.