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

Italy,   pp. 435-506 PDF (27.1 MB)

Page 460

negotiations in respect of preferences cannot be completed within the
time indicated, we would be prepared to consider including in the
treaty suitable provisions of a temporary character and to leave the
final disposition of the Danubian preference problem for settle-
ment in connection with subsequent trade-agreement negotiations.
If it should be necessary to adopt this procedure, the treaty might
provide that, as a temporary measure pending the negotiation of- a
trade agreement or other suitable arrangement, this Government
would not invoke the provisions of Article VIII in respect of customs
tariff preferences now granted to specified countries in the Danubian
area. However, it would be necessary in order to determine whether
such an arrangement would be feasible to have the information pre-
viously requested regarding the preferences now accorded. The in-
formation is desired also for possible use in connection with obtain-.
ing Senate approval of the treaty. Our definitive treaties are not
ratified except upon the advice and consent of the Senate. The Sen-
ate accords such treaties very close scrutiny and should the Executive
be unable to supply full information, he may be subjected to embar-
rassment and the treaty may fail to receive Senate approval.
  5. If the plan under 4 above were adopted, we would be prepared
after the treaty has been concluded, to enter into confidential discus-
sions embracing the subject of Danubian preferences as a preliminary
to the initiation of trade agreement negotiations. However, in any
event, it would be necessary to find a satisfactory solution of the pref-
erence problem before trade agreement negotiations could be formally
  6. For your information and appropriate use, the word "embracing'>
in the preceding paragraph is used advisedly. In any discussions you
may have with the Italian authorities, you should make it clear that we
are not, of course, committing ourselves to proceed with definitive
trade agreement negotiations before the general bases have been ex-
plored and we are sure that the negotiations would not break down
following announcement on other grounds than those discussed in this
cable. If it seems desirable you may orally cite as an example that
prior to announcement of trade agreement negotiations, we would need
to arrive at an understanding that Italy would not have as one of its
objectives the alteration of the balance of trade, but would agree that
any agreement should result in a roughly equivalent expansion of
trade in both directions.
  7. Department wishes to be assured that its understanding and the
understanding of the Italian Government of the main provisions of
Article VIII is identical. Will you therefore at a suitable point in
the discussion ask the Italian authorities orally to confirm the De-
partment's understanding that the provisions of Article VIII such.

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