The Secretary of State to President Coolidge
My Dear Mr. President: It appears that the approaching visit to Washington of the President-elect of the Dominican Republic will offer a most favorable opportunity to discuss with him and with the members of his party various questions of importance affecting the relations between the United States and the Dominican Republic. Among these questions is the proposed revision of the Dominican customs tariff, which will presumably be undertaken immediately after the new Constitutional Government of the Dominican Republic is installed. Under the terms of the Convention between the United States and the Dominican Republic of 1907,33 the consent of the President of the United States is required before any modification of its customs tariff can be made by the Dominican Government.
The principal export of the Dominican Republic is sugar. Owing to the fact that Porto Rico is able to import sugar into the United States free of all duty and that Cuba is enabled to import sugar into the United States with a preferential rate of 20%, Dominican sugar is unable to compete in the United States market with the sugar produced [Page 667] in either of those two Islands, and consequently, all sugar exported from the Dominican Republic is sold either in Europe or in Canada. Because of this situation, it is possible that the Dominican Government, when it undertakes the revision of its customs tariff, will determine that it is to its best advantage to grant preferential rates to Great Britain or to certain European Nations. To preclude the possibility, should this be undertaken, of American exporters finding themselves in a disadvantageous position in the Dominican Republic, it has occurred to me that it might be desirable to undertake with the new Dominican Government an exchange of notes similar to the notes which this Government has recently exchanged with the Governments of Brazil34 and Czecho-Slovakia,35 and which are now being negotiated with Nicaragua36 and with Poland. The effect of this exchange of notes would constitute an agreement between the two Governments pending the arrival of a convenient time for the conclusion of a comprehensive commercial treaty, by which each country will maintain for the commerce of the other a basis of equality with the commerce of every foreign country, an exception will of course be made in the case of the United States to allow for the preferential rates granted by the United States to Cuba.
Should this suggestion meet with your approval, I will endeavor to reach an agreement in principle in this matter with the President elect of the Dominican Republic in order that the suggested notes may be exchanged as soon as possible after his inauguration as Constitutional President of the Republic.