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    "localId": "559236003",
    "label": "Review Group Meeting - US Policy on Spain 1/16/70 [2 of 2]",
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    "id": "559236003",
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    "contentType": "document",
    "title": "Review Group Meeting - US Policy on Spain 1/16/70 [2 of 2]",
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        "National Security Files (Nixon Administration)",
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{
    "seq": 32,
    "pageIndex": 0,
    "type": "photo",
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    "ocrText": "SECRET\n2.\noppose proliferation successfully if we acquiesce in the EC-Spanish\narrangement. It was for this reason that we proposed several weeks\nago, through the interagency trade organization, that the European\nCommunity, Spain and Israel be notified that the United States\nstrongly opposes preferential trade arrangements and, should they\nenter into such arrangements, the U.S. would take action to restore\nthe balance of GATT benefits and tariff concessions with them\n(preferably by compensation, but by retaliation if necessary). While\nthere was strong interagency support for some action to reverse the\ntrend towards preferential trading arrangements, agreement has not\nyet been reached on the specific steps to be taken to that end. A\ncurrent proposal, which we support, calls for a high-level meeting\nwith the European Community to express our serious concern and seek\na solution to the problem posed by the EC policy on preferential\ntrading arrangements, such as the agreement with Spain, which fall\nwell short of full scale association agreements.\nIf the European Community concludes a preferential trade agreement\nwith Spain, and with United States acquiescence or with only token\nU.S. opposition, the most-favored-nation principle of GATT--the\ncornerstone of our trade policy--will have suffered very significant\nand possibly irreparable damage. We can then look towards increasing\nnumbers of preferential trade agreements, and the United States, in\ndefense of its trade interests, will be forced to participate\nactively or seek alternatives in the trade field. One such alternative\nwould be for the U.S. to discriminate on the import side against\ncountries which discriminate against our exports. I would prefer that\nwe not be faced with that alternative.\nThus I believe that our fundamental trade policy interests are at\nstake and urge that we oppose this arrangement. Acquiescence would\ntie our hands, and make far more difficult any effective resistance\nto the dangerous trend toward a preferential trading world. However,\nif the European Community elects to conclude a preferential arrange-\nment in the face of clear United States opposition, damage to the MFN\nprinciple may be moderated and we will have done what we can to pro-\ntect our legitimate trade interests.\nMannie N. Stans"
}