611.5231/904
Memorandum by the Assistant Secretary of State (Sayre)
In a conversation with the Spanish Ambassador,2 at which Mr. Grady3 was present, I informed the Ambassador that we were planning to have our list of desiderata ready to give to him on or about January fifteenth. I asked him whether his Government was expecting to send experts to Washington to carry on the trade agreement conversations. He replied that his Government did not expect to do so but that he himself, with several members of his staff, were expecting to carry on the negotiations. I said that I hoped he would be prepared to begin active conversations by about January fifteenth and he replied that he saw no reason why he could not do so.
I then went on to outline the attitude of this Government with regard to the approaching trade negotiations. I said that we were interested in increasing the trade on both sides and not in trying to weigh the value of each petty concession as against a counter concession given on the other side. I said that if we could increase the amount of American exports going to Spain we would not measure such increase against the increase of Spanish imports into this country. I further said that our whole object was to reduce trade barriers and that I hoped his Government would enter into the negotiations in the same spirit. He said that his Government hoped also to increase the trade on both sides. He went on to say, however, that at present the value of Spanish imports exceeds the value of Spanish exports by about 200,000,000 pesetas and that of this 200,000,000 some 82,000,000 pesatas are covered by an unfavorable balance of trade as against the United States. He said that naturally it was necessary for his country to find some ways and means of cutting down the mounting deficits occasioned by 200,000,000 pesetas unfavorable balance of trade, and that naturally this situation could not be overlooked by his Government in the negotiation of a trade agreement with the United States. [Page 688] When I remarked that a trade agreement can not be one-sided and must envisage concessions made on both sides, he quite agreed and remarked that if the Spanish Government was bent on making trade agreements which would give concessions to Spain and grant none from Spain the Spanish Government could make no trade agreements with any country. I then went on to speak of the efforts of the United States to help promote a movement directed toward the liberalization of the trade of the world and said that if the countries with which we were now negotiating or soon to negotiate would go with us in this policy I felt sure we could accomplish much in helping to tear down some of the existing unreasonable trade barriers. With these general remarks he agreed. Throughout, the conversation was most friendly and informal.