Memorandum by the Chief of the Division of Western European Affairs (Moffat)
The Portuguese Minister called this morning again to urge that we start our commercial treaty negotiations.
He said that these fell into two parts: (1) the immediate question of a wine quota, and (2) the provisions to be included in a treaty which was a matter of less urgency.
He said that his Government was very much upset by the smallness of the quota allotted to Portugal. In the first place, basing the quota on the average for the years 1910 to 1914 was unfortunate, as during those years a relatively small amount of Port and Madeira had been exported; in the second place, the fact that Portugal’s quota was allocated on the same basis as France’s, when the latter had not paid its debt to us, seemed slightly unfair; in the third place, Portugal bought from the United States about five times what the United States bought from Portugal; in the fourth place, Portugal had always bought all of its foreign wheat in the United States and of recent years, particularly since its trade war with France, had favored us in the matter of purchasing automobiles. He therefore felt that Portugal had a right to expect more favorable treatment in the matter of her liquor quota. For instance, with Madeira, there were bona fide orders for five thousand cases and the figure allowed was no more than seventeen hundred.
I told him that I was much interested to hear his point of view; that Mr. Culbertson15 had been doing a good deal of work on different elements of Portuguese-American commercial relations; that Mr. Sayre16 who was going to have charge of the negotiations, was at the present moment studying the matter, and hoped to be able to have a preliminary talk with the Minister before his departure at the end of the week.
We then talked for a little bit of Portuguese internal conditions and I expressed my admiration of the extraordinary financial progress Portugal had made in the last two years. He said that Salazar17 was a real genius and that much of the improvement could be attributed to his personal efforts.