University of Wisconsin Digital Collections
Link to University of Wisconsin Digital Collections
Link to University of Wisconsin Digital Collections
Foreign Relations of the United States

Page View

United States Department of State / Foreign relations of the United States diplomatic papers, 1937. The British Commonwealth, Europe, Near East and Africa
(1937)

Yugoslavia,   pp. 584-595 ff. PDF (4.3 MB)


Page 587


YUGOSIAVIA
with respect to trade of the Treaty of 1881.9 The Minister added
that he expected to receive detailed instructions by mail which pre-
sumably would clear the way to the early signature of the alternative
proposal.
  The Minister explained that it was with great regret that he had
learned of his Government's choice and he expressed the opinion
that those who had taken the decision no doubt regretted it as much
as he did. However, with the proceeds of more than 400,000,000
dinars of Yugoslav exports blocked in Germany and with 150,000,000
blocked in Italy (about 15 percent of his country's total annual ex-
ports), it was quite clear that his Government had no other course
than to bow to the exigencies of the moment. The Minister said that
he had been instructed to make it clear that even after the most-
favored-nation provisions with respect to trade of the 1881 Treaty
had been formally set aside his Government would continue to apply
its import regulations in the most favorable manner to American
commodities.
  Finally, the Minister mentioned that it had been stated in his tele-
graphic instructions that his Government was working on a clearing
or compensation arrangement with respect to trade with the United
States which it would soon have in shape to propose to us. The
Minister seemed much puzzled by this feature of his instructions in
view of the fact that our note of December 17, 1936, had explained in
great detail that our policy was expressly directed against the exten-
sion of all the devices of controlled trade.
  Mr. Sayre expressed regret that the Yugoslav Government had con-
cluded that it could not accept the proffered modus vivendi. He said
that he of course realized the practical effect of German trade prac-
tices on such countries as Yugoslavia and that it was just such situ-
ations that we hope to correct in time through our trade agreements
policy. Under these circumstances we of course are not in a position
to consider offers of clearing or compensation agreements, such agree-
ments being in fact part and parcel of the evil which it is our hope
will be checked and ultimately uprooted by the determination of cer-
tain nations at least to retain the most-favored-nation principle as the
basis of their trade relations.
  Mr. Sayre expressed the hope that the Minister would receive his
detailed instructions shortly so that the agreement to set aside certain
of the Articles of the 1881 Treaty may be concluded in time to obtain
the Senate's consent to ratification before the end of this session of
the Congress. The Minister seemed of the opinion that his instruc-
tions would reach him within the next week or two.
'Convention of Commerce and Navigation between the United States and
Servia; William M. Malloy (ed.), Treaties, Conventions, etc., Between the
United
States of America and Other Powers, 1776-1909 (Washington, Government Print-
ing Office, 1910), vol. Ii, p. 1613.
5837


Go up to Top of Page