287. Memorandum of Conversation1
PARTICIPANTS
-
European Communities
- President Jean Rey
- Vice President Fritz Hellwig
- Commissioner Jean Francois Deniau
- Mr. Raymond Rifflet, Chief of Cabinet to President Rey
-
United States
- President Johnson
- Mr. Walt Rostow
- Assistant Secretary John Leddy
- Ambassador J. Robert Schaetzel
- Mr. Edward Fried
SUBJECT
- Rey’s Meeting with the President, 5:30 p.m., February 7, 1968
At Rey’s request, the President met with the whole party rather than with Rey alone.
Rey expressed his pleasure in making this first courtesy call on the President in his capacity as head of the Commission of the combined [Page 663] communities. He also expressed great satisfaction with his meetings throughout the U.S. Government, and noted the importance of such meetings in dealing with common problems.
He made three points in his presentation:
- 1.
-
Balance of Payments and Trade Measures—Rey congratulated the President on the courageous action he had taken to deal with the U.S. balance of payments program and on the President’s strong opposition to protectionist pressures which could endanger the Kennedy Round.
He said our balance of payments problem does not stem from our trade account—which is in surplus. Measures to deal with the balance of payments, therefore, should be taken in areas other than trade. He was worried that if the U.S. took protectionist action, other countries would follow and eventually the Community would have to move.
- 2.
- Crisis in the EEC—Rey said the Commission deplored existing obstacles to the admission of the United Kingdom to the Communities. He said the Commission was determined to assure that close contacts would be maintained, and that the Benelux memo was a good basis for this. What measures the Five could or should take to cooperate with the UK in outside fields is not yet decided. It was essential to find a reasonable compromise on the UK issue and Rey was optimistic one could be found within the next few months.
- 3.
- Cooperation with the U.S.—Rey pointed out that the Kennedy Round demonstrated how important it was for the U.S. and the EEC to reach agreement on specific issues and how productive such agreement could be. The bargaining was difficult but justified by the results. In the case of trade, the Community could negotiate with the U.S. as an equal.
In the field of development, agreement between the U.S. and the EC in trade policy toward developing countries would provide a good basis for reaching wider agreement on the UNCTAD meeting in New Delhi.
Monetary matters and aid policy were also promising areas of continued cooperation.
The President welcomed Rey in his capacity as Chairman of the merged Commission and thanked him for his remarks. He also welcomed these consultations between the U.S. and the Commission as a useful way of developing productive relations with the Communities.
He reaffirmed U.S. support for the unity of Western Europe, and said it was important that we work closely together on the balance of payments and in other fields. Our overall problems were complex but, to a large degree, solutions depended on how we handled economic issues.
Rey emphasized it was important that we believe in what we were doing.
The President said we faced a difficult task ahead. We had to put our own house in order and are prepared to do so. But we also need the cooperation [Page 664] of our friends. When we had a surplus, we acted appropriately. We are now asking countries who are in a surplus position to act in the same way.
The President agreed with Rey that the U.S. and the European Communities must continue to work together in the trade field, in monetary problems, in development policy, and in atomic energy matters. He said we should also be able to share our experiences in dealing with urban problems—which are becoming increasingly important and common to all industrial countries.
Vice President Hellwig noted the possibilities for useful exchanges in technology and research. He also referred to the advances being made in European company laws and patents.
The President and Rey closed their meeting by reviewing and agreeing on the proposed joint statement.2