Foreign Relations of the United States, 1969–1976, Volume XXIX, Eastern Europe; Eastern Mediterranean, 1969–1972

205. Memorandum From the Presidentʼs Assistant for National Security Affairs (Kissinger) to President Nixon¹

Washington, June 7, 1971.

SUBJECT

• Most-Favored-Nation Treatment for Romania

In previous memoranda to the agencies (Tab A)² I informed them that you had decided to oppose only in a very low key way legislative initiatives to liberalize trade policy toward Communist countries in regard to Most-Favored-Nation treatment. You also decided that our position on Romania should be handled in the same fashion.

Senators Mondale and Brooke have now introduced a bill³ which would grant you discretionary authority to enter into a mutually beneficial commercial agreement with Romania providing Most-Favored-Nation treatment for that country alone.

I believe you should reconsider whether or not Administration response to this bill should continue to be opposition or whether in this case the Administration position should be no objection to this bill.

If the Administration does object to a Congressional grant of discretionary authority, it is likely to cause the Romanians to doubt your previous statements about wishing to improve economic relations. In addition, it would be very awkward and perhaps even impossible, under the legislation being proposed by the agencies, to grant Romania benefits of our tariff preferences scheme for developing countries unless we first grant Most-Favored-Nation status.

Romania is now nearing completion of its negotiations for accession to the GATT. Our opposition to this legislation would mean that our support for Romanian entry to the GATT would seem tepid, at best, despite our many statements in favor of increased cooperation with that country. Peter Peterson adds a further commercial consideration: our deteriorating export balance argues for using available alternatives, including carrots such as this, to promote a higher level of U.S. sales abroad.

There are good reasons not to change the current position. One depends upon your assessment of the domestic political effects so long as the Vietnam War continues. Another is to avoid legislation aimed at specific countries. We had at one point also been worried about the possibility of singling Romania out and thereby exacerbating her relations with the Soviet Union. However, I understand that Ambassador Bogdan does not consider this a danger.

On balance, I believe that our desire for improving relations with Romania argues for a change in the Administration position that would allow us to voice no opposition to a Congressional initiative conveying discretionary authority.

Recommendation

That you decide to allow the agencies to testify that the Administration has no opposition to Congressional initiatives to grant you discretion to enter an agreement giving Most-Favored-Nation status to Romania. (Pete Peterson concurs.)⁴

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 703, Country Files—Europe, Romania, Vol. III Jul 1970–Dec 1971. No classification marking. Sent for action. A notation on the memorandum indicates the President saw it.
2. See Document 23.
3. Reference is to legislation to amend and extend the Export Administration Control Act of 1949. (84 Stat. 931)
4. The President initialed the approval option.