611.2131/260½

Memorandum of Conversation Between the Assistant Secretary of State (Sayre) and the Colombian Chargé (González-Fernández)

Mr. Sayre handed Mr. González an aide-mémoire 10 indicating the changes which this Government desires to make in the trade agreement signed December 15, 1933. Mr. Sayre indicated his understanding that discussions of the proposed agreement would take place in Washington. He expressed the hope that the conclusion of the agreement would be expedited as much as possible so that it could be submitted to the Colombian Congress at its extraordinary session.

Mr. González stated that if the agreement could be concluded in time, the Colombian Government would submit it to Congress at its extraordinary session, which, he said, probably would not adjourn until the middle of February.

Mr. Sayre then called attention to the fact that this Government is not proposing any very radical changes in the agreement signed December 15, 1933. The principal changes are those relating to the non-application of the anti-dumping act to coffee, and the provisions regarding internal taxes. Mr. Sayre explained that when the agreement of December 15, 1933, was signed, it was the intention of this Government to request Congress to make it effective by special act which would supersede any conflicting provisions in existing law. Since it is now intended to bring the agreement into force under the authority of the Trade Agreements Act, it is necessary that its provisions come clearly within the authority of that Act. The provision regarding the non-application of the anti-dumping act to coffee and regarding the limitation of the amount of state and municipal taxes, not being authorized by the Trade Agreements Act, it becomes necessary to change them. Mr. González seemed to feel that these changes would not create any serious difficulty.

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Mr. Sayre then called attention to the fact that this Government is offering additional concessions on three products of Colombia involving a 50% reduction in existing duties, these additional concessions being made possible by the fact that the Trade Agreements Act has provided the authorization necessary therefor. He stated that we would appreciate such consideration as Colombia on its part might give to the granting of additional concessions on American products. Mr. González expressed his gratification regarding the proposed additional concessions by the United States. He seemed to feel that there is a possibility of reciprocal action by Colombia, especially since duty reductions are already under consideration in Colombia. He pointed out, however, that the executive branch of the Colombian Government, unlike that of the United States, must submit the agreement to the legislature and this tends to make additional concessions by Colombia more difficult.

Mr. Sayre then called attention to the proposal of this Government, that an exchange of notes be entered into concurrently with the proposed trade agreement, in regard to foreign exchange control. Mr. González stated that the foreign exchange control problem is being cleared up. He said that as regards current business, American interests have no difficulty in getting exchange. With reference to blocked commercial credits, he stated that 40% of the credits blocked as of September, 1931, have been liquidated and referred to the announcement of the Colombian Government, following the inquiry by our Legation at Bogotá, to the effect that the remaining 60% of the blocked credits will be cleared up in three monthly installments, ending February 15, 1935. While he could not speak officially, Mr. González stated that there is a definite trend toward the complete removal of foreign exchange control.

  1. Infra.