Foreign Relations of the United States Diplomatic Papers, 1933, The American Republics, Volume IV

625.3531/8

The Ambassador in Argentina ( Bliss ) to the Secretary of State

No. 1865

Buenos Aires , November 18, 1932.
[Received December 1.]

Sir: With regard to my despatch No. 1601 of April 22, 1932,⁴⁰ reporting to the Department the closure of the Transandine Railway, as a result of the prohibitive tariffs raised by both countries against each other which stifled all commercial exchange between them, and to a more recent reference in my General Conditions Despatches concerning a commercial agreement to be entered into by Argentina and Chile which would enable the Transandine Railway to be reopened, I have the honor to report that on November 12, Doctor Saavedra Lamas, Minister for Foreign Affairs, and Señor Jorge Silva Joacham, Chilean Chargé d’Affaires, signed a commercial agreement between the two countries, translation of which is transmitted herewith enclosed.

The preamble of the agreement expresses the desire that commercial relations between the two countries should be resumed, and that the measures agreed upon are of a temporary nature, but serve as the basis for an ample and definite future agreement.

The agreement is based, for the most part, on a return to the 1930 tariffs as regards imports of Argentine cattle into Chile, while Argentina reduces by 50% customs duties on certain Chilean products.

Article 1 deals with Chilean imports from Argentina and provides that the tariffs in force on June 30, 1930 shall be applied to Argentine cattle and quebracho extract. Chilled, salted and canned meat will be subjected to the duties in force on June 30, 1926.

Article 2 makes provision for Argentine imports from Chile which are granted a reduction of 50% on the import duties. These include many types of wood, certain vegetables, fruit, fish and minerals.

The agreement provides that it shall remain in force for the space of six months from November 15, 1932.

The agreement was signed by the Argentine Government in accordance with authorization contained in Article 76 of the Customs Law, and therefore does not require parliamentary ratification.

In this connection there are transmitted herewith enclosed, summarized translation of editorial comment⁴¹ upon the agreement which appeared in the Buenos Aires Herald of November 2, La Prensa of November 13 and La Nacion of November 13.

The Buenos Aires Herald in commenting on the proposed re-opening of the Transandine Railway complains that probably no compensation will be offered to the unfortunate victims of the dispute, the much abused British shareholders, for heavy losses will have to be met. The Herald believes that the shareholders have a good case against the Argentine Government for the losses inflicted.

La Nacion, on the subject of the agreement with Chile, states that it is the first agreement of reciprocity signed in the express and documental form of an international protocol and that it will probably form a precedent for other equally necessary agreements with other countries to further Argentine international commerce.

La Prensa, on the subject, states that the Transandine Railway will not be able to maintain itself exclusively on the proceeds of its traffic but depends on the million peso subsidy of the Chilean Government. The temporary nature of the agreement and general insecurity make the future of the railway uncertain and La Prensa therefore finds the proposed renewal of the railway services encouraging but not complete. The situation requires a permanent treaty based upon free trade.

As a result of the signing of this agreement it is expected that the first train (freight only) for Chile over the Transandine Railway will leave Buenos Aires on November 19. According to report it would appear that trains will be limited to one a week in each direction until traffic justifies a more frequent service.

In connection with the resumption of train services, however, it is of interest to state that a recent press despatch from Santiago, Chile, asserts that the Chilean Government desires and has raised the question of establishing a joint administration over the entire length of the Transandine Railway. This is not a new question, for in past years the Chilean Government has endeavored unsuccessfully to have this brought about. The Argentine Government has consistently opposed this arrangement for military reasons, it is believed. The raising once more of this question at this time may possibly delay the present intended resumption of the train services.

Respectfully yours,

Robert Woods Bliss

[Enclosure—Translation]

Commercial Agreement Between Argentina and Chile, Signed November 12, 1932

The Governments of the Argentine Republic and of the Republic of Chile, in consideration of the general desire to encourage reciprocal trade between the two nations and the traffic which unites them, have resolved, by common accord, to negotiate a “modus vivendi” which, by immediately establishing the most adequate provisional measures for the purpose and through the observation and experience thereof, may provide a practical basis for the preparation of a broader agreement which may definitely regulate Argentine-Chilean commercial relations, for which purpose they have appointed their respective plenipotentiaries; i. e., The President of the Argentine Republic has appointed his Minister for Foreign Affairs and Cult, and the Vice-President of the Chilean Republic has appointed Señor Don Jorge Silva Joacham, his Chargé d’Affaires in the Argentine Republic; after having exchanged their respective full power, found to be in due form, they agreed upon the following points:

• Article 1. Beginning on the 15th instant, the Custom-house of the Chilean Republic will cancel the import duties on Argentine products indicated as follows:

  a) The introduction of cattle will be subject to the tax in force on June 30, 1930, established by Law 4121 of January 24, 1927;

  b) The introduction of quebracho extract will be subject to the tax in force on June 30, 1930, established by Law 4321 of February 22, 1928;

  c) The introduction of chilled and preserved meats, corned beef, salted meat and meat preserves, will be subject to the tax in force on June 30, 1926, established by Law No. 3066 of March 1, 1916, with subsequent modifications until the date indicated in the present clause.

• Article 2. Beginning on the 15th instant, the Custom-house of the Argentine Republic, within the attributions granted to the Executive Power in Article 76 of Law 11,281, will liquidate with a 50% discount the existing duties (Laws 11,281 and 11,588, not including those mentioned in Article 4 of the present law) regarding the introduction of the following Chilean merchandise:

  Coigüé, rauli, laurel-whitewood, lingüé, mañío, pellín and larch-tree woods, whether in boards, planks, beams, logs, posts for wire-netting, empty cases, unmounted casks or barrels.

  Peas, split-peas, chick-peas, lentils, beans, haricot-beans, garlic and onions; tomato paste and red pepper; malted barley, barley and oats.

  Hemp seed, undressed hemp; fresh apples, pears and alligator-pears; grapes for wine-making; dried apples and plums; nuts; tinned fruit; tinned peas and asparagus.

  Centollas, lobsters, and oysters in tins. Live lobsters, cockles and fish.

  Sulphur, industrial nitrate of sodium, impure sulphate of copper, carbonate of copper, plaster of paris, tartaric acid, quillay, common glue, and boldo leaves.

• Article 3. The present “modus vivendi” will be in force for six months beginning on November 15 as indicated above.

In proof of which the abovementioned plenipotentiaries, signed and sealed the present “modus vivendi”, in duplicate form, on the twelfth day of the month of November of the year nineteen hundred and thirty-two.

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