Foreign Relations of the United States, 1964–1968, Volume XVII, Eastern Europe

144. Memorandum of Conversation¹

Washington, July 16, 1964, 3 p.m.

SUBJECT

• Actions to Carry Forward Agreements Reached During Recent US-Rumanian Talks

PARTICIPANTS

• US
  • The Secretary
  • EUR/EE—Peter F. Warker
• Rumania
  • Petre Balaceanu, Minister to the United States of The Rumanian People’s Republic

Minister Balaceanu said he had left Bucharest to return to the US on July 9 after three weeks of consultation with his Government. He said this consultation had involved intensive work on the means to carry forward promptly the agreements which had been reached between the US and Rumania during the talks held in Washington May 18–June 1 between delegations of the two Governments. The discussion of this subject was the main purpose of his call.

After conveying warm greetings to the Secretary from Rumanian Foreign Minister Manescu, Mr. Balaceanu stressed that top Rumanian officials very much appreciated the good results achieved during the recent Washington talks and considered that a sound start had been made for improving relations between the two countries in the commercial field. He expressed appreciation for the steps the US had taken since the talks, citing the June 15 Presidential determination making Export-Import Bank credit guarantees available to Rumania² for other than agricultural products and the publication by the Department of Commerce on July 14 of a special general licensing procedure for Rumania. He said that these steps reflected a desire on the part of the US to move forward on the agreements reached during the Washington talks.

As for the Rumanian side, the Minister said that Rumania would be sending about 10 technical experts to the US to discuss contract details with producers of equipment which Rumania was interested in purchasing from US firms and to arrange for the visit of US businessmen to Rumania to conclude the contracts. It was hoped that the first orders for US equipment could be placed by the beginning of August. The Minister said Rumania was also planning to send a number of expert personnel to the US to seek to expand the market for Rumanian goods in the US.

Minister Balaceanu expressed the hope that he could count on the Secretary’s assistance regarding Rumanian interest in purchasing a nuclear power reactor in the US, in arranging credits with the Export-Import Bank where he envisaged the need would be in the neighborhood of $40 million (excluding the nuclear reactor), and on the problem of most-favored-nation treatment for Rumania. He also expressed hope that the Secretary could assist in arranging Commodity Credit Corporation credits for Rumania for the purchase of agricultural commodities. On this point, the Minister noted that Rumanian officials had already talked in general terms with Secretary Freeman and Under Secretary Murphy to explain why Rumania needed such credits. Since Rumanian earnings from exports to the US were limited, a purchase on three-year CCC credit of commodities which Rumania produced in sufficient quantities to meet its own needs (e.g., edible vegetable oils) would enable Rumania to expand its exports of such commodities and use the proceeds to purchase other goods from the US. He said that Rumania was very strict in meeting its foreign payments obligations, and such transactions would help it to do so.

The Secretary responded to the Minister’s remarks by saying that the US intended to try to move on a constructive basis to carry forward the relations between the two countries. He noted that the President’s action regarding Export-Import Bank guarantees and the Commerce Department’s action on licensing were examples. As regards the most-favored-nation problem, the Secretary said that this would have to be considered later. The Secretary observed that the Rumanians might encounter certain US firms which would be reluctant to sell products to Rumania even though the Department of Commerce had approved export licenses for a particular transaction. He also noted that the announcement of a major transaction might occasion considerable comment and that any problems arising in this area would have to be faced. Concerning the Minister’s idea of purchasing US agricultural commodities under CCC credit to replace exported Rumanian commodities of the same kind, the Secretary said that this type of transaction may present a problem but this could be explored.

1. Source: Department of State, Secretary’s Memoranda of Conversation: Lot 65 D 330. Confidential. Drafted by Warker and approved in S on August 11. The meeting was held in the Secretary’s office. The source text is labeled “Part I of IV Parts;” other memoranda of this conversation, dealing with East-West political relations and the visit of Foreign Minister Manescu to the United States, are ibid.
2. For text, see Department of State Bulletin, July 6, 1964, pp. 26–27.