Letter from Secretary of Commerce Charles Sawyer to Secretary of State Dean Acheson

OF SECRET 006494 ACTION 15 UNIVERSITY SECURITY DECLASSIFIED THE SECRETARY OF COMMERCE is assigned to STATES E.O. 12065, Sec3.31 WASHINGTON 25 CommarieState Dept. Guidelines, March 6 1982 April 1983 ER-Wight FE BY2T DEB NLT, Date 4-5-85 E RECEIVED ANY 446g. .119/2-15 MAR 30 1951 EUR APR 2 The Honorable Bureau of FAR EASTERN AFFAIRS DEPT STA The Secretary of State DC Washington, D. C. APR 3 - 1951 EVR ASSISTANT SECRETARY E My dear Mr. Secretary: Department of State 181114 FE -nc-opt The problem raised in your letter of March 22 regarding export policy towards Hong Kong has been the subject of extended dis- cussions among the Departments of State, Defense and Commerce. The three Departments have been unable to find a common meeting ground, and the issue has been referred to the National Security Council as part of the NSC 104 paper. I, too, am anxious to reach a proper solution of this problem. The difficulty in reaching agreement appears to stem from a XR 419 difference in approach. The Defense and Commerce position is based on 446g. 446g ,939 the premise that our embargo on goods to Communist China is sound and that we cannot permit the movement of U. S. goods, directly or indirectly, to Communist China while our military forces are engaged in armed con- flict with the Communists. Because of its peculiar position as a major port of entry for Chinese imports Hong Kong is necessarily affected by our Chinese embargo policy. We in the Department of Commerce fully appreciate the signi- ficance of Hong Kong as an outpost of the free world and we recognize the importance of maintaining the highest measure of cooperation between the United States and the United Kingdom. We agree that every reasonable effort should be made to supply Hong Kong with the commodities required for the support of its basic economy. Nevertheless, we feel bound to give the most serious consideration to the evident need to maximize the effectiveness of the embargo upon the shipment of U. S. goods to China. It was in an effort to develop a workable means of achieving these objectives that the Department drafted the proposed reply to the British Aide Memoi a which was transmitted to Mr. Rusk by Mr. Miller on February 21st. [believe that it should be possible to work out 19 reconcili- ation of the views of our Departments. I have accordingly instructed officers of my Department to initiate discussions with appropriate DC/R Anal 39 SECRET L. MESSAGE CENTER 011332 5 CONTROL Rev 4 Cat clarge sheel 4/4 OUT