Statement by the President on the Agreement Reached at the Civil Aviation Conference in Bermuda.

I WANT to express my satisfaction with the conclusion of an Air Transport Agreement with the United Kingdom at Bermuda on February eleventh. It is now clear that very difficult problems in specialized technical areas in the relations of the two countries can be worked out separately from the overall financial and trade negotiations which took place during the fall. Under the Bermuda Agreement there will be no control of frequencies, and no control of so-called fifth freedom rights on trunk routes operated primarily for through service. It gives to the airline operators the great opportunity of using their initiative and enterprise in developing air transportation over great areas of the world's surface.

Because civil aviation involves not only problems of transportation but security, sovereignty and national prestige problems as well, the joint working out of air transport agreements between nations is a most difficult one. Many countries, naturally desirous of having air transport companies of their own, and with treasuries heavily depleted by their war efforts, have a genuine fear of the type of rate war with which the history of various forms of transportation has been so full. In the Bermuda Agreement the Executive Branch of the United States Government has concurred in a plan for the setting up of machinery which should protect against the type of rate war feared by so many of the countries through whose air space we desire that our airlines have the right to fly. Part of the plan for future rate control will be dependent on the granting of additional powers by the Congress to the Civil Aeronautics Board.

The major purpose of the two Governments in regard to civil air transport has now been set forth in writing and it reads:

"(1) That the two Governments desire to foster and encourage the widest possible distribution of the benefits of air travel for the general good of mankind at the cheapest rates consistent with sound economic principles; and to stimulate international air travel as a means of promoting friendly understanding and good will among peoples and insuring as well the many indirect benefits of this new form of transportation to the common welfare of both countries."

I believe the results of this Conference constitute a very important forward step.