Foreign Relations of the United States, 1961–1963, Volumes VII, VIII, IX, Arms Control; National Security Policy; Foreign Economic Policy, Microfiche Supplement

441. Memorandum from Palmer to Jones, May 11¹

May 11, 1961

SUBJECT

• Commercial Work in Field

I recently attended the first regional conference of commercial officers in Hong Kong, stopping off also at Bangkok and London where the first permanent US trade centers are to be located; at Kuala Lumpur and Duesseldorf where there are pilot projects for commercial work; and at other posts en route, i.e., Tokyo, Beirut, Vienna, Frankfurt, Bonn, and Paris. This trip enabled me to get a first-hand view of commercial work at different missions and to discuss certain of its aspects with our Ambassadors or principal officers.

Proposals for a separate commercial foreign service under the Department of Commerce were uniformly opposed by our people, as well as by Commerce’s own people assigned in the field as commercial attaches. It was generally recognized that it is not feasible to make an arbitrary division between economic and commercial work which a separate commercial service would require. Therefore, such a service would result in wasteful duplication. Moreover, the top echelons of our embassies are of necessity concerned with such matters as liberalization of trade, the removal of restrictions against US goods, tariff and customs problems, all of which are basic to the promotion of US exports.

I was impressed by the fact that present organizational arrangements permit trade promotion under such different conditions as obtain in Malaya and in Duesseldorf. In the former, the principal medium for trade promotion is a newsletter sent out to business people giving information concerning American firms wishing to sell in the Malayan market. In the second case, the commercial staff concentrates on setting up trade information booths at various specialized trade fairs and soliciting from people attending the fair expressions of their interest in importing specific American products. Both methods have been productive, although these excellent markets for American goods have not yet been fully exploited by American business. There is also a vast difference between our commercial work in the UK, which is centralized in London, and in Germany where markets and commercial activities are dispersed throughout the country. Also, our present organizational set-up for commercial work in the field facilitates cooperation with ICA and the furtherance of our commercial interests in those countries where a substantial segment of imports is financed by U.S. aid programs.

The present close coordination of commercial and economic work provides flexibility of work assignments of both American and local staffs. Thus in 1960, the Foreign Service was able to increase the number of trade opportunities developed by 75 per cent, and take care of 40 per cent more business visitors with only a nominal increase in total staff. However, we have now stretched our resources to the limit, and there is no slack to handle the still increasing workload. Our principal commercial officers find themselves pretty much deskbound and unable to get out to make the personal contacts so important to trade promotion. In both London and Bangkok, it is apparent that additional help must be provided to cope with the extra load on the commercial staff which will result from the establishment of permanent trade centers. In these circumstances, we must fund a substantial increase in commercial officers and supporting staff this year if we are not to provide further ammunition to those who advocate a separate commercial service.

I also had occasion to discuss with our top people and others the proposal to provide special commercial advisers to operate on the regional basis. Practically all of the people with whom this was taken up were enthusiastic about the idea, including commercial attaches who are presently on loan from the Department of Commerce to the Foreign Service. Specifically, Ambassador McClintock of Lebanon thinks that such a special commercial adviser in Beirut could serve a most useful purpose. Similarly, Ambassador Dowling in Bonn believes this is an excellent idea and thinks that we should have at least two such advisers in Europe. He would be pleased to have one of them stationed in Frankfurt which is a logical location, being both an airline crossroads and a large commercial center. Ambassador Young would like to have one stationed in Bangkok.

1. U.S. trade promotion abroad. Official Use Only. 2 pp. Department of State, Central Files, 400.11/5–1161.