File No. 832.85/75
The Secretary of State to the Ambassador in France ( Sharp)
3322. The Department has been advised by American Ambassador to Brazil that 10 out of the 30 ex-German steamers are in commission and at sea of which the Itu is en route to New York. General repairs in machinery being made on 20 in five Brazilian ports, of which 7 will be presumably ready for sea during March.
Also that on March 1 the Havas Agency distributed press reports quoting Pichon as stating in Chamber of Deputies that “Brazil in fact had an opportunity to choose between identical offers from the United States and France and selected the French proposals in the friendliest manner. In no less friendly a manner the United States acquiesced in this determination.” The statement regarding identical offers is inaccurate since the United States Government submitted a definite offer for these boats. Negotiations were instituted in [Page 505] August 1917 between the United States Government and the Government of Brazil for the utilization of these boats. The Government of Brazil met our advances in the friendliest manner but stated that they hoped that the American and French Governments would combine their projects so as to relieve Brazilian Government from the embarrassment of choosing between the plans of two friends. The Department asked the French Government to agree to the United States continuing these negotiations with Brazil for the purpose of securing the vessels for the benefit of all the Allies. The French Government replied that their negotiations with Brazil were almost closed and that it would seriously embarrass them and prejudice the successful outcome of the negotiations if the United States Government pressed its negotiations. It appearing to the Department that our withdrawal and support of the French negotiations would bring about the most rapid employment of the vessels, which was the object desired, the Department instructed the American Ambassador at Brazil to withdraw from all negotiations for these boats.
This Government is prepared to live up to the resolution taken at the inter-Allied conference in Paris in November 1917, which resolution is quoted in Department’s 3018, January 2, 7 p.m.1 The Department believes that the memorandum the British Ambassador has been instructed to communicate to the Foreign Office, the substance of which is quoted in your 3127, February 2, 3 a.m.,2 should be supported by you and it should be pointed out to the French Government that the United States Government believes that these German boats secured by France from Brazil are not exempt from the resolution of the inter-Allied conference.
However, the Department is not interested in pressing this question to any great extent provided these boats, when repaired, are used by the French for the best possible use of the Allies. Accordingly, you are instructed to ascertain from the Government to which you are accredited exactly what use is being made of such of these boats, as are now in operation and what use the French Government proposes to make of the remaining boats when repaired.
The need for shipping at the present time is so great that the Department is desirous of ascertaining whether these boats are being used simply for purpose of carrying coffee from Brazil to France, or whether they are actually being used in the best possible interest of all the Allies.