Office of the Historian

322. Memorandum of Conversation1

Washington, January 28, 1970, noon.

SUBJECT

  • US–UK Talks: Trade Topics

PARTICIPANTS

  • U.S.—Secretary Rogers
  • U.K.—Foreign Secretary Stewart

Foreign Secretary Stewart said that while HMG was generally pleased by the US posture as regards free trade policy, they were disappointed and disturbed by the lack of response on certain topics—non-cotton textiles, chocolate crumb, the escape clause action on carpets and glass. HMG was not only concerned about the effect on the special articles, but even more about the principle involved. The details should be discussed at official levels.

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As regards textiles, Stewart said that outside the US no one was convinced that American industry was being damaged. He believed there was danger that the US action would be read as a signpost pointing in the wrong direction. HMG and the Government of Japan were following policies of greater liberalization. Any reversal of liberalization would redound to the disadvantage of the developing as well as the developed countries. Stewart said that US shipping policies were also presenting difficulties.

The Secretary said that in this general context of trade discrimination he wished Mr. Hillenbrand to discuss the possible relationship between Spain and the Common Market. Mr. Hillenbrand said we all knew that the Spanish were presently seeking an agreement with the European Community that would provide preferential treatment for the Spanish. Negotiation of the exact terms was still to be completed.

Mr. Hillenbrand added that this placed the US in a rather difficult dilemma because of our own base negotiations with Spain. We have been generally concerned that proliferating trade agreements by the European Community would set a pattern contrary to existing commercial policy and one not consistent with GATT. We have been told by the Spanish that one of their considerations in the base negotiations would be some expectation of a forthcoming US attitude on their relationship to the European Community.

Mr. Hillenbrand said that we probably could not take a passive position on this and we hoped for support from HMG in the GATT if we were to press the issue in this forum. Spanish resentment might be blunted if the US did not play the solo role on this problem.

As regards textiles, the Secretary said we all recognized that there were certain anomalies in our respective positions which arise largely from our own domestic political pressures. He added that we would look into this further.

  1. Source: National Archives, RG 59, Central Files 1970–73, POL UK–US. Secret; Exdis. Drafted by Irving Cheslaw (EUR/BMI) and approved in S and U on February 16. The meeting took place in the White House Cabinet Room. A full list of the participants is attached but not printed. The original is marked “Part 11 of 14.”↩