611.60F31/6–1645
The Assistant Secretary of State ( Clayton ) to the Czechoslovak Minister for Foreign Affairs ( Masaryk )
My Dear Mr. Masaryk: I have received your letter of June 16, 1945 relative to the bill (H.R. 3240, 79th Congress, 1st Session) to extend the authority of the President under Section 350 of the Tariff Act of 1930 as amended, which makes impossible a reinstatement of [Page 542] the trade agreement concluded between our two countries in 1938. As you doubtless know, the bill has now been approved by Congress and sent to the President for signature and therefore it is not possible for me to take action looking to the deletion from the bill of the provision preventing the President from again proclaiming the trade agreement with Czechoslovakia. It is anticipated that the bill will be signed by President Truman within the next few days.92
I wish to assure you, however, of the personal interest which I have in the restoration of normal trade relations between our two countries. In this connection discussions have already been held with representatives of your Government with a view to an exchange of notes recognizing that the trade agreement is no longer in effect on either side, and providing in its place, as a temporary measure, a regime of most-favored-nation treatment in commercial matters without specific schedules of tariff rates on either side. This exchange of notes has been suggested in a note of June 14, 1945 from the Acting Secretary of State, Mr. Grew, to His Excellency Vladimir Hurban, Ambassador of Czechoslovakia. I am enclosing a copy of this note.93
You may be assured that this Government is prepared to give sympathetic consideration to any proposal which may be made for the negotiation between our two countries of either a new trade agreement or a treaty of friendship, commerce, and navigation, or both. Until a trade agreement or such a treaty is concluded between our two Governments, I feel that the exchange of notes mentioned in the note to Ambassador Hurban will furnish a satisfactory interim basis for the commercial relations between our two countries.
I realize that your country has suffered considerable destruction as a result of the occupation by the Nazis and is anxious to establish advantageous trade relations with the United States as a means of assisting the speedy restoration of the economy. Because of the destruction suffered by your country and the dislocation of its economy, an extensive revision of the trade agreement, even had it not been terminated, would have been required if our two countries were to derive the maximum mutual benefit from the tariff concessions. Such renegotiation would probably have been so extensive as to be tantamount to the negotiation of a new agreement. For this reason it does not appear that the termination of the trade agreement between our two countries will have harmful effects, especially if notes providing for most-favored-nation treatment should be exchanged between our two Governments. By the time exports from Czechoslovakia again become substantial it may be possible that a new trade agreement providing for mutual tariff concessions will have been concluded between our two countries.
[Page 543]Permit me to add that direct investments of private American capital may be of some assistance in the restoration of the economy of Czechoslovakia. The negotiation of a commercial treaty, establishing a legal basis for the mutual protection of the interests of the nationals of our two countries in the territories of the other, would facilitate such investments.
I am taking the liberty of sending a copy of this note informally to Ambassador Hurban. If you plan to stop in Washington on your return from San Francisco, I hope that it will be possible for us informally to discuss these problems further.
Sincerely yours,