611.2131/99
Memorandum Left at the Department of State by the Colombian Minister (Lozano), September 2, 1933
In the memorandum handed to the Minister of Colombia by the Department of State, there is expressed a desire to call attention to certain commercial data which throw light upon the schedules which are included with the treaty and which constitute a part thereof.
In our opinion, the said schedules treat certain factors in an isolated way. It is necessary to take into consideration essential economic [Page 229] factors of the countries which are going to make an agreement; the figures shown by the volume of imports in some previous years, particularly considered between Colombia and the United States. Nor is it possible to lose sight of the significance for Colombia and the United States of certain figures representing the products exported from Colombia to the United States.
The following ideas constitute a synthesis of the reason for the counter-proposal which is suggested.
1. Every commercial treaty, inasmuch as it is a bilateral pact between two nations, not only should aim at a greater rapprochement between them, but also should seek the reciprocal development of the two countries, so that there ought to be reciprocal concessions not involving prejudicial results for either of the contracting parties.
2. The Republic of Colombia has intensified with admirable success the production of foodstuffs of the first necessity, and, it being considered, furthermore, that she is distinctly an agricultural country, it is not possible to accept reductions in the customs rates which can affect in any way her agricultural growth.
3. It should not be lost to view that, as the Republic of Colombia is a country whose economic prosperity depends especially on the success of her agriculture and of essential industries which have been undergoing development with excellent results, any customs measure that would permit the economic weakening of the country by the ruin of her agriculture or of her industries will, incidentally, injure American commerce, because it will end by reducing appreciably her consumption capacity, and her purchases abroad will thereby be diminished in the same proportions. Likewise it should be borne in mind that both the nation and various official entities have in existence loan obligations to the United States, and that it is necessary to secure the economic improvement of the Republic in order that she may continue to be capable of carrying out her obligations.
4. It is necessary to consider that in the volume of articles of export from Colombia to the United States there appear articles whose product does not really enter the country, as occurs, for example, in the case of petroleum and bananas, it not being possible, consequently, to accept in a general form the abstract result shown by the comparative figures of the commercial interchange between the United States and Colombia.
5. It is necessary to consider that from 1927 to 1930—a period of great commercial movement and apparent prosperity, and a period in which the volume of imports into Colombia reached very important figures—the percentage relating to the importation from the United States presents the following indices: [Page 230]
| 1927 | — | 44.89% |
| 1928 | — | 44.59% |
| 1929 | — | 45.94% |
| 1930 | — | 45.41% |
| 1931 | — | 44.33% |
| 1932 | — | 42.10% |
6. The percentage index of importations from the United States in 1932 clearly shows that it is not possible to take isolated figures corresponding to certain articles in the volume of imports. The total volume of imports by Colombia must be considered, for while it is true that owing to the restrictions introduced in Colombia’s tariff, the importation of certain articles has diminished appreciably, it is also true that the ensemble of the articles imported by Colombia from the United States has kept the same index, which shows that while exports from the United States to Colombia have been reduced as regards certain articles or goods, on the other hand, the volume of importation of other articles derived from the United States has increased proportionately.
7. It is interesting to compare the index of the proportion of imports into Colombia from the United States, Germany, and Great Britain, in order to draw the conclusion that the greatest volume of our import commerce has always been with the United States.
| Year | United States | Great Britain | Germany |
| 1925 | 50.05% | 22.54% | 9.66% |
| 1926 | 48.67% | 16.88% | 13.02% |
| 1927 | 44.89% | 15.01% | 13.93% |
| 1928 | 44.59% | 12.64% | 15.60% |
| 1929 | 45.94% | 14.40% | 14.42% |
| 1930 | 45.41% | 12.42% | 12.88% |
8. It must also be taken into account that the greater part of the articles exported by Colombia to the United States are products of first necessity which are not produced in the United States and which because of the existing tariff provisions are on the same footing of equality with the same products proceeding from other countries which may or may not have the same volume and the same proportion of imports as articles proceeding from the United States.
9. The purchasing and consumption capacity of a country cannot be maintained in commercial interchange with another country at an absolute balance since there enter into play economic factors which are of fundamental importance, such as the total number of inhabitants, the wealth of the country, and the supply and demand of certain articles.
10. It must be taken into consideration that in the Republic of Colombia the customs revenues constitute the principal income of the [Page 231] national budget and, therefore, any change which affects the tariff would also cause a lack of balance in the budget because of the diminishing of the flow of income into the treasury from customs duties. It is well understood that the fiscal organization of a country depends on the balancing of its budget, and the Republic of Colombia desires not to change her line of conduct of tending consistently to obtain effective and balanced figures in the operation of her budgets.
11. The Republic of Colombia desires to render firmer and closer her commercial relations with the United States of America, and on this occasion, in order to demonstrate this in an effective and palpable form, she offers to effect a reduction in her tariff rates, particularly on articles and manufactured products typically pertaining to the commerce of the United States, it being considered that the tariff reduction in the form offered and approximately in the proportion indicated in the memorandum presented by the Government of the United States, will secure the benefits and advantages to which the Government of the United States aspires.
12. In Schedule No. 1,13 reference is made to the statistics corresponding to the imports in the year 1930 for the reason that in the said year there appears a median figure between the high imports of Colombia in the years 1927, 1928 and 1929 and the reduced imports in the years 1931 and 1932. Possibly the reductions offered by Colombia will bring into effect, as a consequence, the new tariff proposal assuring a volume of importation not inferior to that of 1930. At the same time it is necessary to take into consideration the fact that in the year 1930 the new provisions of the Colombian customs tariff which were promulgated in the year 1931 had not yet gone into effect, and that they had as an immediate and visible consequence the very appreciable reduction of imports into Colombia.
13. As the Republic of Colombia desires to increase her exports to the United States of certain articles which do not appear to injure the economy of the United States, it is requested that in Schedule No. 213 submitted by the American Government there be included certain articles or goods which are produced or which may be produced in Colombia to an amount sufficient for exportation, and which will thus create a new economic factor favorable to the two countries.