Foreign Relations of the United States, 1958–1960, Western European Integration and Security, Canada, Volume VII, Part 1

74. Circular Telegram From the Department of State to Certain Diplomatic Posts⁰

October 13, 1959.

476. Luxembourg and Brussels pass Embassies for info; Paris for USRO and Embassy; Tokyo for USDelGATT. Ref: Colux 32,¹ rptd info Brussels Busec 9, being rptd other addressees by Dept. Dept concurs desirability Butterworth informally advise Hallstein, Marjolin and Rey preliminary Dept reaction Hallstein proposals. Butterworth authorized make following points:

1. While we have not had adequate opportunity examine Hallstein proposals in detail, and while we will undoubtedly have various specific questions and comments, we recognize they represent step in right direction. If implemented we feel Hallstein proposals could result in lower external tariff for Common Market thus easing trade problems both of outside countries and of low-tariff Benelux countries within Common Market. We would hope therefore all EEC countries will publicly support this liberal approach.

2. While emphasis in US Govt is upon world-wide multilateral solutions trade problems, we are taking no specific position re Outer Seven at this time. FYI. We assume that Outer Seven convention will in fact be signed before end of year and that it would be counter-productive for US even to imply that it is attempting bring influence to bear against signature. End FYI.

3. As indicated recent private Dillon discussions with French and British here,² we feel that EEC should by specific actions indicate that it plans to take steps which would reduce or eliminate trade problems and worries of outside countries. We recognize that for various reasons, including heavy dependence EEC markets, problem is initially more urgent for certain European countries. (Important that problems non-European countries not be overlooked however.) Any such specific actions by EEC in favor other countries (European or non-European) should of course be consistent multilateral principles of GATT. This point is basic to our thinking. While Marjolin has personally discussed with us³ possibility of selective tariff reductions by Common Market on MFN basis, he states that neither he nor other EEC officials have discussed such possibilities frankly and informally with European countries primarily concerned. FYI. Marjolin indicated that in his personal view such EEC reductions might in certain cases be made without requirement for reciprocal concessions. End FYI.

As you know certain elements in EEC have appeared to hold rigidly to principle that outside countries should prove concrete trade damage before EEC would discuss ways and means of mitigating such damage. We feel this position is not adequate. Fact is adjustments already being made in many countries in anticipation of elimination internal EEC trade barriers and establishment common external tariff.

We feel therefore would be highly desirable if EEC spelled out in more detail that part of Hallstein proposals covering special trade problems of various European countries. FYI. We realize that some of fears of other European countries may be exaggerated. Would seem however that only way to get at substance of matter is for EEC to make serious attempt discuss specific commercial issues either bilaterally or multi-laterally with countries concerned. End FYI.

Beyond initiation quiet talks on any immediate specific problems we believe it essential that EEC countries in near future take some action which will make real impact on European and world public opinion. Pro forma endorsement of Hallstein proposals would not be sufficient. To date suspicions about trade policy of EEC have revolved to considerable extent around French protectionism. We understand that French Govt may shortly announce its firm intention to pursue liberal trade policy with emphasis on world-wide considerations. Believe that dramatic statement by De Gaulle or Pinay making clear firm French support of truly liberal EEC policies including acceptance Hallstein proposals as first step to this end and followed by concrete EEC action on trade problems outside countries, would go far to improve present situation. If French prepared make real public commitment in above sense, we would hope all EEC Govts would unite behind Commission to implement liberal EEC policy.

Herter

0. Source: Department of State, Central Files, 440.002/10–1359. Drafted by Myerson and Tuthill. Sent to Luxembourg and Brussels and repeated to London, Stockholm, Ankara, Athens, Bern, Bonn, Copenhagen, Dublin, Geneva, The Hague, Lisbon, Oslo, Paris, Reykjavik, Rome, Vienna, Madrid, Helsinki, Ottowa, and Tokyo.
1. In Colux 32, October 11, Butterworth requested the substance of Dillon’s reaction to the Hallstein proposals prior to the meeting of the EEC Committee on Association scheduled for October 19 in Brussels. (Ibid., 440.002/10–1159)
2. See Documents 72 and 73.
3. See Document 71.