611.3531/357
The Ambassador in Argentina (Weddell) to the Secretary of State
[Received October 7.]
Sir: I have the honor to refer to the Embassy’s telegram No. 187 of August 22, 12 noon, 1935,16 and to its previous correspondence regarding the conversations which on the Embassy’s initiative the Commercial Attaché of the Embassy has been undertaking with officials of the Argentine Ministry of Finance to establish the cause of the discrepancy existing between the statistics of Argentine exports to the United States issued by that Ministry which since January 1, 1935, show a lesser value than the returns for the same period declared before the American Consulate General in Buenos Aires.
These negotiations were held up pending the receipt of information from the Department whether certain Argentine shipments of rye which were declared before the Consulate General but not shown in the Argentine statistics, actually entered the United States for consumption. Information having finally been received that five of the six rye shipments in question did so enter, Dr. Dye is again endeavoring to resume his discussions with the Argentine Ministry of Finance, pointing out that in this particular case the Argentine statistics were incorrect and that as a result an additional allotment of exchange is due American interests.
I enclose a copy of Special Report No. 332–C, dated September 25, prepared by the Commercial Attaché on this subject, together with [Page 279] its enclosures, copies of his letters dated September 24 and September 19,17 to the Director of the Exchange Control Office and the Director General of Statistics, respectively, to which I trust the officials of the Department handling these problems in connection with the United States and Argentina will give their careful attention.
Dr. Dye’s report is self-explanatory. The only comment which need be added is that it is highly unfortunate that under the present Argentine exchange control system, wherein official exchange is allotted to American interests only in proportion to American purchases from Argentina, American commerce with this country should be more or less penalized through the application of a set of export and import statistics which, while compiled and published officially here, have already been shown to be inexact.
I am, of course, hopeful that the Ministry of Finance will correct the error in this particular instance and give American importers an exchange allowance to make up for the difference. At the same time it is not unlikely that further researches, involving time and undue labor, would disclose other statistical errors as might be expected when different bookkeeping methods and calculations are practised. As Dr. Dye points out, one of the difficulties involved is the identity of Argentine exports shipped “To Order” whose ultimate destination cannot be ascertained until after a lapse of three months.
While the case will be presented to the Argentine authorities to the best of the Embassy’s ability, I am sure the Department is aware that like all Latin Americans the Argentines are expert in evading an issue by indulging in involved academic discussions capable of being indefinitely prolonged.
In dealings of this character it is to be observed that in Argentina there are two methods of getting things done—one, by personal influence as between friends, and the other, by presenting arguments which, although not necessarily retaliatory, are nevertheless of so persuasive a nature that they get results. While the Embassy is doing all that it can along the line of the first method, it has, I think the Department will agree, very little if any material corresponding to the second method at its disposal. Furthermore, as has been often reported by this Embassy, the Argentine Ministry of Finance, which with the Ministry of Agriculture runs the financial-economic administration of this Government along dictatorial lines, wants a trade treaty with the United States and is unquestionably using what pressure it can bring by its system of exchange control to obtain this end, at the same time favoring British imports, to our disadvantage, looking towards a renewal of the Roca-Eunciman Trade Agreement with Great Britain.18 The Ministry of Finance is aggrieved at the credit [Page 280] rating given Argentina in the United States as revealed in stock exchange quotations, which in its opinion is unjustifiably holding up the conversion of Argentine loans contracted for in the United States. (The Department will not overlook the fact that had not the American market in past years absorbed large issues of Argentine bonds, our present exchange difficulties might not have arisen or else been considerably modified. The situation illustrates admirably how foreign loans floated in the United States may redound to the distinct disadvantage of American manufacturers and exporters.) Another cause of dissatisfaction is the restrictions against Argentine meat, steps for the removal of which the Administration is now taking in the Sanitary Convention with Argentina recently signed in Washington.19
These specific items of reproach towards the treatment the United States gives Argentina do not help the Embassy’s discussions with the Finance Ministry here on matters such as the present case of exchange restrictions which is now under discussion with the Ministry of Finance.
I should be grateful therefore for any views or comments the Department might give me (if there be any) to aid in bringing these discussions to a successful conclusion.
Respectfully yours,