810.5151 Williams Mission/3: Telegram

The Secretary of State to the Ambassador in Brazil ( Gibson )

74. The Department has studied with the greatest interest the report and recommendations prepared by the Embassy in regard to the operation of the Brazilian exchange control and its bearing on American trade. It believes the occasion favorable for developing through discussions with the Brazilian authorities an understanding which will protect and help to develop American trade.

With a view towards facilitating this outcome it has arranged with the Federal Reserve authorities that John H. Williams, Economist of the Federal Reserve Bank of New York and an expert in international [Page 587] exchange matters, should pay a visit to Rio de Janeiro and other South American countries where similar problems confront us.

The pertinent portions of Mr. Williams’ instruction are as follows:

“In each of these (designated) countries the American diplomatic and commercial missions will be instructed to assist you in obtaining the fullest possible understanding of all aspects of the exchange control situation, and to put you in touch with the local governmental authorities who are concerned in this matter. You in turn are instructed upon your arrival in each of these countries to put yourself at the disposition of the head of the mission for the purpose of assisting him in the consideration of the exchange control situations with which he has been dealing and for the purpose also of working out with him the major lines of policy immediately to be pursued by this Government. You will find that these missions have given very considerable thought to the subject and have kept themselves closely advised.”

The Department has informed Mr. Williams fully of the course of developments and of the work done by you in the matter.

Mr. Williams sails on Steamship Western Prince which is due to arrive in Rio de Janeiro on July 13. He is accompanied by Mr. Donald R. Heath of the Division of Latin American Affairs of the Department.

The Department trusts that the despatch of this mission will indicate to the Brazilian governmental authorities the importance attached to it here. Please plan to take full advantage of the visit to try to work out satisfactory understanding with the Brazilian Government.