611.3731/1185a
The Department of State to the Cuban Embassy
Memorandum
The economy of Cuba being based primarily on agriculture, the concessions which the United States is prepared to make to Cuba are largely to agricultural products.
The outstanding concession and of vital importance at this time to the rehabilitation of Cuba’s livelihood is regarding sugar, where it is proposed to reduce the rate on Cuban raw sugar (96 degrees) to ninetenths of a cent per pound, with a preference of twenty percent.
For tobacco, second in importance in Cuban production, it is proposed to reduce the rates on all tobacco products of interest to Cuba, and to subject Cuban tobacco imports to a quota of eighteen percent of the total quantity of tobacco used in the United States in the manufacture of cigars. This proposal is very favorable to Cuba, inasmuch as domestic production has been curtailed to a far greater extent than the decline in imports of Cuban tobacco, and furthermore represents a percentage of participation higher than that enjoyed by Cuba during either of the last two years.
It is proposed to make seasonal concessions for Cuban fresh fruits and vegetables. These concessions should prove of assistance to the Cuban program for crop diversification. Cuba produces many fruits and vegetables that mature earlier in the winter than the similar products [Page 156] produced in the United States, but has not been able to ship them to the United States in large quantities because of the tariffs. Under the arrangement proposed, the present rates of duty will be lowered during the months of Cuban production. On this basis concessions are proposed for Cuban grapefruit, lima beans, potatoes, tomatoes, cucumbers, eggplant, okra, peppers and squash. In addition to these seasonal rate reductions, year round reductions are proposed for pineapples and limes.
The attached statement61 sets forth the complete list of maximum concessions which the United States is prepared to make with the exception of those concerning sugar products classified under Paragraph 502 of the Tariff Act of 1930.
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