Foreign Relations of the United States, 1969–1976, Volume XXIX, Eastern Europe; Eastern Mediterranean, 1969–1972

107. Memorandum of Conversation¹

Washington, June 23, 1969, 3:30 p.m.

SUBJECT

• Hungarian Ambassadorʼs call: US Reply to Hungarian Note of May 22 (see Memcon, May 23, 1969)²

PARTICIPANTS

• Hungarian Ambassador Janos Nagy
• Martin J. Hillenbrand, Assistant Secretary for European Affairs
• Leslie C. Tihany, Hungarian Country Officer, EUR/EE

Ambassador Nagy called, at Mr. Hillenbrandʼs invitation, to receive our reply to the Hungarian note of May 22, in which the Hungarians had proposed a high-level review and negotiation of all outstanding US-Hungarian bilateral problems. In handing the Ambassador our note,³ Mr. Hillenbrand orally stated our agreement in essence with the Hungarian proposal but suggested that we begin talks at once in the existing ambassadorial channel at Budapest. After review and discussion of our bilateral problems by Deputy Foreign Minister Szilagyi and Ambassador Puhan, we could come to a decision regarding the level and venue of the next phase. Mr. Hillenbrand mentioned, in passing, that we continued to be interested in moving toward a solution of the claims problem. He also told the Ambassador that there would have to be a delay in our submission of a negotiating draft of the proposed US-Hungarian consular convention in view of the fact that the Vienna Consular Convention of 1963,⁴ on which our draft is based, may soon come up for hearings before the Senate Foreign Relations Committee. We would wish to complete our draft in the light of the Senate action on the Vienna convention.

On the related subject of amortization of the Hungarian surplus property debt balance, Mr. Hillenbrand stressed to the Ambassador our strong interest in moving ahead on this problem without further delay. He explained that we would not like to have progress held up on this matter, which has already been a subject of considerable discussion between our Embassy and Messrs. Szilagyi and Reti. Specifically, we would like to have an early answer from the Hungarians to our request for a more favorable (30 forints to $1) drawdown rate and also an indication of what the Hungarians had in mind when they suggested a “contemporary advantage” for this arrangement in a non-financial area. An early resolution of this problem, Mr. Hillenbrand noted, would assist in creating a helpful atmosphere for progress in other, related matters.

In accepting the note, Ambassador Nagy expressed pleasure that it contained “good news.” In response to a question from Mr. Hillenbrand as to what kind of procedure the Hungarians envisaged for the proposed review and examination of our bilateral problems, the Ambassador said that, in making its May 22 proposal, his Government had one of three channels in mind: Deputy Foreign Minister Szilagyi with Assistant Secretary Hillenbrand in Washington; Szilagyi with a State Department delegation in Budapest; or Szilagyi with Ambassador Puhan, also in Budapest. He agreed with Mr. Hillenbrand that, in view of Mr. Szilagyiʼs present poor state of health, the third of these three possibilities appeared most appropriate at least until autumn. At that time, he concurred, we could further assess the situation.

Mr. Hillenbrand replied in the negative to a question from Ambassador Nagy whether our note was being simultaneously delivered in Budapest to the Ministry for Foreign Affairs. He said that our Embassy did have the text.

The Ambassadorʼs call ended in a brief and informal tour dʼhorizon, in the course of which he and Mr. Hillenbrand ranged over a wide field, including the Suez, the Hungarian merchant marine, and Ambassador Dobryninʼs, as well as the Far East Soviet Ambassadorsʼ, return to Moscow on consultation. Throughout the entire conversation the tone was cordial. In taking his leave, Ambassador Nagy expressed pleasure at Ambassador Puhanʼs presentation of credentials speech on June 16, a copy of which he had received from Budapest.⁵

1. Source: National Archives, RG 59, Central Files 1967–69, POL HUNG–US. Confidential. Drafted by Tihany. The meeting took place in Hillenbrandʼs office.
2. Both the Hungarian note of May 22 and the memorandum of conversation of May 23 are ibid.
3. The reply to the Hungarian note of May 22, dated June 23, is attached but not printed.
4. For text of the agreement, which entered into force for the United States on December 24, 1969, see TIAS 6920.
5. Not found.