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

100. Memorandum of Conversation⁰

January 19, 1960, 3:30–5:30 p.m.

SUBJECT

• European Regional Economic Matters

PARTICIPANTS

• Prime Minister Nobusuke Kishi¹
• Foreign Minister Aiichiro Fujiyama
• Ambassador Koichiro Asakai
• Mr. Haruki Mori, Director, American Affairs Bureau, Foreign Ministry
• Mr. Takeshi Yasukawa, Counselor, Japanese Embassy
• Mr. Toshiro Shimanouchi, Counselor, Japanese Embassy
• Secretary of State Christian A. Herter
• Assistant Secretary of State for Far Eastern Affairs, J. Graham Parsons
• Assistant Secretary of Defense John Irwin II
• Ambassador Douglas MacArthur II
• Mr. David M. Bane, Director, Office of Northeast Asian Affairs
• Mr. Richard L. Sneider, Officer-re-Charge, Japanese Affairs

Prime Minister Kishi commented that the Japanese Government feels trade with all countries should develop in the spirit of GATT on a nondiscriminatory basis. It recognizes and appreciates United States actions to prevent trade discrimination. He said that Japan does not wish to see itself excluded from discussions of important international problems involving discriminatory actions.

Secretary Herter described the steps taken by the United States with respect to the problems posed by European trading blocs. He mentioned that Under Secretary Dillon had been in Paris for the past week as a result of discussions which had taken place on this matter during the President’s trip to Europe.² During his trip, the President had discussed the problem of the “Sixes” and “Sevens” with Prime Minister Macmillan, President De Gaulle and Chancellor Adenauer. A number of other matters related to trade discrimination were also discussed and, as a result, we had proposed in the Communiqué issued by the Western leaders that a meeting take place in Paris on trade and other economic problems. In addition, the President had mentioned in the State of the Union message the possible formation of a revised OEEC. The Secretary said that at the Paris meeting on January 12–14 they had agreed to form several committees. One of the committees is to consider a reorganized OEEC in which Canada and the United States could become full members, since we cannot join the present OEEC due to constitutional problems. There is to be a special committee of four to prepare working documents on the OEEC problem by April 19. He pointed out that the United States hoped to arrange for Japan to associate itself with the successor organization to the OEEC although how such an association would be arranged is not certain. In addition, it was agreed at the Paris meeting that everything should be in the spirit of GATT in an effort to insure non-discriminatory trade. The Secretary emphasized that Japan and the United States had a common interest in non-discrimination in trade and that we wish to keep fully in touch with the Japanese Government on this problem.

Mr. Parsons mentioned that on January 15 a departmental officer had met in Paris with Minister Sato of the Japanese Embassy and briefed him fully on the developments at the Paris meeting. The departmental officer had also mentioned that the United States hoped for Japan to be associated not only with the successor organization to OEEC but with a capital exporting group to be set up. Minister Sato had been provided with copies of Mr. Dillon’s statement, the original United States resolutions as well as the final resolutions emerging from the meetings. Ambassador Asakai commented that the Japanese Embassy had received word of the discussions in Paris and very much appreciated them.

Prime Minister Kishi mentioned that at the meeting with the President during the morning³ he had taken up the question of assistance to under-developed areas. He said that during his trip last year to Western Europe,⁴ he had placed considerable importance on discussion of this problem with the European leaders. He found both President De Gaulle and Prime Minister Macmillan particularly interested in development projects in the African area, in view of the efforts by the Soviet Union to push its projects for assistance to under-developed areas. The Prime Minister said that he found himself in full agreement with the European leaders on this question. Japan, at the same time, is particularly interested in Southeast Asia, since it is close to Japan. He mentioned that Japan is attempting to assist its neighbors in Southeast Asia through reparations and other means such as private investment, the extension of long-term credits, and tripartite arrangements with the U.S. such as the Orissa iron ore project. The Prime Minister felt that, in this area, there is a need for the closest liaison, contact and consultation between the United States and Japan not only at the Government level but at the private level. He hoped that both Governments would work to create an atmosphere conducive to the stimulation of private contributions to the development of under-developed areas.

Secretary Herter inquired whether the Prime Minister had discussed with other Government leaders the new International Development Agency.⁵ The Prime Minister said that he had and felt that with the establishment of the International Development Agency there was no need for new organizations or agencies in the field of development. He believed that what is necessary now is to enable the existing agencies to work more effectively by recognizing the need for assistance to underdeveloped areas and by earnest efforts on the part of all countries. The Secretary agreed that there was no need for new machinery but there was a need for closer consultation to coordinate assistance efforts and establish priorities. He mentioned in this connection that an informal group of capital exporters was set up at the Paris meeting to consider this question and that the United States is proposing to have Japan associated with this group.

0. Source: Department of State, Central Files, 374.800/1–1960. Confidential. Drafted by Sneider. The meeting was held at the Department of State.
1. Prime Minister Kishi visited Washington January 17–21.
2. Reference is to the Paris Heads of Government meeting at which the OECD idea was discussed; see Document 80. Eisenhower visited Paris during his 11–nation good will tour December 3–23, 1959.
3. The meeting was held at the White House at 11 a.m. While discussing the need for expanded aid to the underdeveloped nations, Eisenhower pointed to Africa as the area in which such aid would be a potent force in stopping Communism. Kishi agreed with the need for such action to deal with Communism. (Department of State, Conference Files: Lot 64 D 559, CF 1586)
4. Kishi was in Europe July 12–23, 1959, during his July 11–August 10 world tour.
5. A U.N. agency created on September 24, 1960, concerned with the promotion of economic development among poor nations. Its creation had been proposed by the Board of Governors of the International Bank for Reconstruction and Development at its September 1959 meeting.