The Minister in Latvia (Skinner) to the Secretary of State
[Received May 2.]
Sir: I have the honor to acknowledge the receipt of the Department’s Instruction No. 182, dated April 4, 1933, in regard to discrimination against American trade. I regret to infer therefrom that the feeling prevails in the Department that particular cases of discrimination have not been enquired into and dealt with appropriately, and especially as such is not at all the case.
1. Our trade relations with Latvia are covered by a guarantee of “most favored nation” privileges. Yielding to circumstances, the Latvian Government has set up a system of complicated contingents and “valuta” regulations, the latter more trying than the former. Thus, when the importer obtains a permit to bring in certain goods he may be, and if the goods are of American origin, frequently is, refused a permit to purchase exchange with which to pay for them. Large committees dispose of these questions, and it is not easy to establish responsibility. The fact is undeniable, however, that importers of American goods are advised to place their orders in Great Britain or Germany, as they can obtain “valuta” with which to pay their bills. In numerous instances the Consulate and the Commercial Attaché’s office have intervened successfully; in others, importers have quietly refrained from purchasing desired American goods, and in still many other cases, possibly the most numerous class, intending importers of American goods have evaded the restrictions by the use of influence. I am handicapped in my efforts to overcome obstacles to particular importations by the usual refusal of the importer to give particulars upon which official action might be based, lest reprisals against him follow.
2. Whenever information of a specific character is available respecting obstacles placed in the way of importing American goods, officers of the Legation have appealed to the competent authorities. Invariably, action is promised but long delayed. In some instances representations have been successful, in others partially successful, and at other times they have failed. I have, myself, personally, and in writing, dealt with the Minister of Foreign Affairs on these matters, and in despatches to the [Page 605] Department have disclosed the situation, among these despatches being my No. 88 of February 26, 1932; No. 201 of May [March] 30, 1932; No. 292 of April 25, 1932; No. 657 of August 24, 1932; 1096 of January 26, 1933.4 On March 30, 1932, I left an Aide-Mémoire with the Minister of Foreign Affairs, a copy of which is enclosed herewith. On January 23, 1933, after a conversation, and to assist the Minister, I sent him a formal note, a copy of which is enclosed herewith, and on March 9, 1933, having in the meantime received no reply, I sent him another.
3. As the correspondence above mentioned discloses, I have complained orally and in writing, in season and out of season, about trade discrimination. I suspect that under the preceding Government the amiable dispositions of the Minister followed by inaction arose from lack of authority on his part; that is, the committees dictated to the Government and not the Government to the committees. At all events the Government in which Mr. Zarins was Minister for Foreign Affairs fell some weeks ago before I could obtain from him any statement in reply to my complaint that our Treaty rights were not being respected. The question remained open and in a most unsatisfactory state when the Ministry fell.
4. Early in March a new Government was formed, with Mr. Salnais as Minister of Foreign Affairs. At my first meeting with him in his present capacity I pointed out various facts, and especially that I was awaiting an answer to my enquiries. He promised to familiarize himself with the circumstances, and I have heard unofficially that some sort of a note is being drafted at the present time in the Foreign Office, with respect to which I shall report as soon as I receive it.
5. I anticipate that the Latvian Government, if and when they terminate their policy of avoidance, will say that they were not the only ones to invent restrictions and contingents, that they have been forced into their present position, that we buy little from them, whereas other countries buy a good deal, and finally, that necessity knows no law. It is a fact, I believe, that the British, who are the best customers of this country, constantly urge the local Government to direct their purchases into British channels, and the implied threat of losing British trade is used to our disadvantage.
6. The Department mentions four cases discussed at the Conference of American Government officers, held on February 23, 1933. The following are the particulars:
Underwood Typewriters: The intending importer, after consultation with the Commercial Attaché, consulted a certain Mr. Kacens, of the Import Regulating Committee, and eventually secured the foreign exchange permit;
Tractor Parts: In this case the local representative of the Ford Motor Car Company was informed that there were no dollars available, and [Page 606] that American parts invoiced in dollars could not be brought in. He was told to buy his parts elsewhere, and as the importer was obliged to fill the order within a limited time, he procured the goods in England rather than drop out of the business. He gave the information in confidence and did not desire any of our officials to intervene;
Petroleum Products: The director of the Standard Oil Company stated to the Commercial Attaché that he had been compelled to resort to barter in order to get money out of the country, and had made one transaction involving 20,000 lats worth of Latvian lumber. This information was given in confidence;
Spark Plugs: In this matter the importer, who also represents the Ford interests, applied for an import permit for 1,000 kilograms of spark plugs from the United States; 200 from Germany; and 100 from England. The permit received by him authorized him to import 300 kilograms from England and none from the United States. This importer, as above related, spoke in confidence, and as he imports from several countries and not alone from the United States, was unwilling to endanger his position with the authorities by stressing the American case and obtaining action from the Legation.
Thus, while it is often impossible to force the particular case upon the attention of the authorities, I have used the information to the best advantage in my general representations.
7. A quarterly report asked for in the last paragraph of the Department’s Instruction will be provided, but it might be remarked in this connection, that the Department is always informed respecting new laws and decrees affecting trade, and of our action in such cases, in separate despatches.
8. The Legation and the Consulate, and the Commercial Attaché, as well, are cooperating to the fullest extent and are doing their utmost in difficult circumstances to relieve our trade of its burdens. I have never failed to have prompt and effective assistance in these matters from all of our representatives.