Foreign Relations of the United States, 1969–1976, Volume IV, Foreign Assistance, International Development, Trade Policies, 1969–1972

288. National Security Study Memorandum 35¹

Washington, March 28, 1969.

TO

• The Secretary of State
• The Secretary of Defense
• The Secretary of Commerce
• The Secretary of the Treasury
• The Secretary of Agriculture
• The Special Representative for Trade Negotiations
• The Director of Central Intelligence
• The President of Export-Import Bank

SUBJECT

• U.S. Trade Policy Toward Communist Countries

The President has directed a review of U.S. Trade Policy toward Communist countries. This subject was originally to be covered in the response to NSSM 16, U.S. Trade Policy, but the President wishes a fuller treatment of these issues than would be possible as part of that overall review.²

This study should examine policy towards COCOM, U.S. differential controls, trade with Eastern Europe, Asian communist and Cuban trade embargos, and extraterritorial effects of trade controls, by treating the following elements:

• —the effectiveness of present measures;
• —the strategic impact of these controls upon communist countries;
• —relations with our allies;
• —other relevant factors including U.S. exports, our balance of payments and relations between the U.S. Government, on the one hand, and U.S. business and labor, on the other.

The paper should then explore alternative U.S. policies, including legislative changes if necessary, such as continuation of our present course, various means of modifying controls, what countries should be included and possible differentiation among them. Finally, the paper should briefly describe present U.S. government organization for implementing trade control policy and examine possible improvements in this machinery.

The President has directed that this study be prepared by an Ad Hoc group chaired by the Assistant Secretary of State for Economic Affairs and including representatives from the Department of Defense, the Central Intelligence Agency, Department of Commerce, Department of Agriculture, Department of Treasury, Office of the Special Representative for Trade Negotiations, the Export-Import Bank, and the Assistant to the President for National Security Affairs. The Chairman may invite other agencies to send representatives as appropriate.

This report should be submitted to the Review Group by May 9, 1969.

Henry A. Kissinger

1. Source: National Archives, RG 59, S/S Files: Lot 80 D 212, NSSM 35. Confidential.
2. NSSM 10, January 28, called for a study of East-West relations. The NSSM itself, and the response forwarded on February 11 to Kissinger by Assistant Secretary of State for European Affairs John M. Leddy, in his capacity as Chairman of the NSC Interdepartmental Group for Europe, did not address trade issues. (Both ibid., NSSM 10) NSSM 16, February 5, is printed as Document 182. The response papers and the April 9 NSC meeting on trade policy did not discuss East-West trade. Additional documentation on East-West trade is scheduled for publication in Foreign Relations, 1969-1976, Eastern Europe; Eastern Mediterranean, 1969-1972.