96 Dunk to Burton

Cablegram PC127 PARIS, 31 August 1946, 12.05 p.m.

SECRET PERSONAL

Our position on Economic Commission is very difficult. Our amendment of full text Article 64 Italy [1] received no support in debates and was voted out 15 to 2 with 3 abstentions.

Reason apart from U.S.S.R. bloc and opposition United Kingdom, United States and France was that other claimants fear to dispute with Russia before their own claims are considered.

We were subject to full blast from Molotov and Vishinsky.

No way of manoeuvering out of our position. In fact meeting this afternoon refused to defer final consideration of Section A of Article 64 until claims under Section B are considered. Canada moved this but only five supported. As result meeting Foreign Ministers yesterday seems that United Kingdom, United States and France have been directed to give immediate support to finally drafted articles. Significant that to-day they have come in immediately and briefly in support. This naturally has a big influence.

We will move amendment paragraph 3 of Article 64 Section A to make agreement for selection delivery etc. of reparations goods matters for agreement between U.S.S.R. and proposed reparations and restitution commission. This will revise first part of the original proposal. We are assured of some support for this but am not over sanguine of favourable vote.

Regard it as important that Mr. Beasley's final address in Plenary should fully cover the motives behind our amendments and make it clear that we have done what we could to bring reality into the treaties. Responsibility [2] adverse economic results rests on members of conference who allowed self interest in expediency to dominate their attitude and not on Australia.

1 The draft treaty agreed to by the Council of Foreign Ministers provided for an Italian payment of US$ 100 million to the Soviet Union, with other countries' claims to be considered at the Paris conference. Australia proposed that a special commission determine how much Italy paid, and to whom. The U.S.S.R. delegation was especially hostile to this proposal, questioning Australia's right to a voice in European affairs at all.

2 A symbol here indicates 'groups missing'.

[AA:A1067, E46/38/14]