611.60131/51a
The Secretary of
State to the Minister in Estonia (Lane)2
No. 10
Washington, February 16, 1937.
Sir: You are instructed to proceed to
Tallinn at the earliest date possible for the purpose of delivering
to the Estonian Minister for Foreign Affairs3 a signed note, the text of
which is contained in the enclosure to this instruction, containing
the reply of this Government to the proposals of the Estonian
Government4 for modification of the present Treaty
of Friendship, Commerce, and Consular Eights between the United
States and Estonia.5
Before you deliver the note you will of course desire to familiarize
yourself with the reports and the discussions relating to treatment
of American trade in Estonia and the proposals for the modification
of the existing treaty that have been made by the Estonian
Government. It is assumed that the First Secretary of the Legation
at Tallinn6
will go over the record with you, and that he will accompany you
when you call upon the Minister.
In your conversation with the Minister you should apologize for the
delay which has taken place in replying to the proposals that have
been made by the Estonian Government. You should explain that the
delay was occasioned in part by the very careful study which your
Government has given to the proposals, and in part by the great
volume of work devolving upon the Department in connection with the
carrying out of the trade agreements program.
In amplification of the note which you will hand to the Minister you
should state orally to him that your Government regrets exceedingly
that the suggestions made by the Estonian Government do not
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appear to provide a basis
for an agreement between the two countries embodying tariff
concessions, but that it hopes that its position in this regard will
not be interpreted as indicating any lack of appreciation of the
difficulties inherent in the circumstances in which Estonia finds
itself. You should make it clear that your Government shares the
Estonian Government’s desire to increase commerce between the two
countries and is hopeful that notwithstanding these difficulties a
basis may be found for bringing about an augmentation of
American-Estonian trade.
You should state further that should the Estonian Government find it
possible to include in an agreement guarantees of substantially
nondiscriminatory treatment for American trade, the United States
Government would be disposed to consider the negotiation of a
limited trade agreement containing concessions on some of the items
in which the Estonian Government has expressed an interest and of
which Estonia is an important, even though not a first supplier.
Should the Minister ask you what commodities this Government has in
mind, you may reply that while you have not been furnished with a
list of the commodities which your Government considers as
constituting a possible basis for discussion, you believe that from
material which has been furnished you, it seems likely that potato
alcohol and vodka are included.
It is hoped that you will be able to make arrangements for a
discussion of the matter, after you have seen the Minister, with Mr.
Edward Wirgo, Director of the Foreign Trade Bureau of the Estonian
Foreign Office, along the lines of your conversation with the
Minister.
Please report fully the result of your conversations with both
officials and inform the Department promptly of any information you
may obtain which would indicate the treatment that the Estonian
Government intends to accord to American trade subsequent to May 22,
1937.
Very truly yours,
For the Secretary of State:
Francis B. Sayre
[Enclosure]
Draft of a Note to the Estonian Minister for
Foreign Affairs
My Government has given careful study to the note of the Estonian
Government dated December 20, 1935, containing proposals with
regard to revision of the Treaty of Friendship, Commerce, and
Consular Eights between the United States and Estonia. It
desires to express its appreciation of the frankness with which
the Estonian Government has set forth the considerations which
influence the formulation
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of its foreign commercial policy. My
Government fully understands these considerations and is not
insensible of the limitations that are imposed on Estonia’s
freedom of action within the sphere of foreign trade by the
commercial policies pursued by countries which are the principal
buyers of Estonian goods.
As was pointed out in the memorandum7 which
the American Chargé d’Affaires at Tallinn delivered on September
27, 1935, to the Acting Minister for Foreign Affairs, the
American Government is engaged in a program under the Trade
Agreements Act8 looking, on the one hand, to the
reduction of excessive tariff barriers and other governmental
impediments to trade and, on the other hand, to the progressive
elimination of the many discriminatory and arbitrary practices
which divert and obstruct trade. This program is based upon the
principle of equality of opportunity and treatment; a principle
to which the Estonian Government has declared itself unable to
give full adherence except under conditions which may not soon
be fulfilled. The Estonian Government will doubtless appreciate
that the successful carrying out of my Government’s program
would be jeopardized should the American Government agree to any
substantial exception in the application of this basic
principle, for such an agreement would necessarily involve tacit
approval of the very practices which the United States is
seeking to eliminate. The United States could not enter into a
trade agreement which did not provide substantial equality of
treatment for American trade.
My Government has noted with sympathetic interest the desire
expressed by the Estonian Government to expand Estonian exports
to the United States and is prepared to afford every facility
compatible with its general policies that would contribute to
realization of that desire. The Estonian Government has
suggested that this expansion can be achieved only if the United
States is prepared to offer tariff concessions to Estonian
products, and it has expressed its desires in this connection
with regard to certain specific commodities.
These desires, and the suggestion of the Estonian Government that
certain quotas be established for which reduced tariff rates
would be granted, have been examined with great care by my
Government. I must, however, point out that, as the Estonian
Government is aware, it is my Government’s policy to grant
concessions in general only to the principal or an important
supplier of a given commodity. On the basis of information
available to my Government, Estonia does not appear to be the
principal or even an important supplier of most of the articles
for which reduced customs duties in the United States are
suggested, and in some instances it does not participate in the
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trade at present.
Six of the commodities with respect to which the Estonian
Government has proposed tariff concessions have already been
made the subject of concessions in trade agreements with
countries which are the principal sources of imports into the
United States. The benefits of these concessions are extended to
Estonia at the present time by virtue of existing treaty
provisions. In the case of certain other products in which the
Estonian Government has expressed an interest, Estonia is among
the major sources of supply of United States imports. These
commodities might furnish a basis for discussion of trade
concessions of limited scope should it be possible to arrive at
an agreement respecting provisions of a general nature
guaranteeing substantially non-discriminatory treatment by each
country of the commerce of the other.
My Government wishes again to draw the attention of the Estonian
Government to the fact that Estonia is now receiving the benefit
of tariff and other concessions granted by the United States to
countries with which it has concluded trade agreements. Estonia
will continue to receive these benefits and the benefits of
concessions in any new agreements which may be concluded by the
United States, provided it accords substantially
nondiscriminatory treatment to American trade.
The Government of the United States is heartily in accord with
the desire of the Estonian Government to seek additional means
for the expansion of trade between the two countries and will
give sympathetic consideration to any further suggestions which
the Estonian Government may wish to make to this end.
