611.3531/161
Memorandum by the Acting Secretary of State
The Argentine Ambassador showed me a lengthy telegram which he had recently received from his Government asking him to ascertain the view point here with respect to a commercial agreement between Argentina and the United States. The message referred to the concessions which were being given to the British Government3 and to negotiations with one or two other European Governments looking towards mutual reciprocal trade benefits and said that it was important for the Argentine Government soon to make up its mind the attitude it would have to assume towards the United States in the future.
I gathered that there was a veiled threat, although the Ambassador did not convey it as such, that if there were no prospects of trade negotiations with the United States, the United States would suffer in consequence. The Ambassador mentioned in particular the proposed deal with the British in respect to automobiles which would seriously affect the export of American automobiles to the Argentine; Mr. Espil said that he had already discussed this matter with officials in the Department of Commerce, who admitted that American automobile trade would suffer.
The Ambassador assured me that he had, at various times, explained to his Government that they must not overlook the movement here to raise prices which carried with it, of course, a continuation of the high tariff and that the recent rise of prices in the Argentine might be explained, in part at least, by the rise in prices in the United States; he said he did not want his Government to overlook the fact that the Argentine was already receiving benefits from the renewal of prosperity in this country.
I replied that I did not wish the Ambassador to carry away the impression in anything which I might say or left unsaid that we were not desirous of negotiating a commercial treaty with the Argentine. He understood, however, the position in which the Executive was now [Page 646] placed and that a three-fourths [two-thirds?] vote in the Senate was still necessary to carry into effect any commercial treaty, that in these circumstances the Executive must necessarily proceed cautiously in initiating reciprocal trade agreements so as not to arouse the fears, especially of the agricultural districts; that we were, therefore, proposing to start our negotiations with a few countries where there would be almost no danger of competition and that once these treaties were effected, we could much more easily approach other countries where the problems to be overcome were more difficult. The Ambassador said he fully understood; however, he felt that he would like to have a definite reply to convey to his Government and had, therefore, asked to be received by the President at the latter’s convenience. He said there was no hurry in this connection.
The Ambassador seemed to think that a very limited reciprocal treaty, that is, limited in its scope of reciprocal changes in tariff, might be feasible.