832.5151/598: Telegram
The Chargé in Brazil (Gordon) to the Secretary of State
[Received 8:40 p.m.]
106. Department’s 63 April 24, 5 p.m. Am I correct in assuming that the Department or the National Foreign Trade Council will determine the classification of small creditors as well as the amount which is to be divided among them which again I assume to be the equivalent of one million pounds sterling as under the British agreements?
In any event, the Finance Minister, whom I saw this afternoon, will only handle this category of frozen credits as indicated in your telegram if he obtains a loan for the amount in question. The Minister is in entire accord as to the necessity of paying off category B at once.
As to category C, his position is that he must treat us in the same manner as he did the British and therefore must issue governmental interest-bearing obligations. He calculates that he can set aside up to £2,000,000 sterling annually to take care of interest and amortization on British and American backlog and he further estimates that this amount will enable him to give us proportionate treatment to that accorded to the British; in other words if our backlog in this category proves to be three-fourths that of the British he will set aside the equivalent of £800,000 sterling annually.
I took up with the Minister the other details covered by Department’s telegram as well as some additional ones but for the sake of greater precision it was agreed that I should furnish him with a written aide-mémoire (which I have already done) and that he would reply thereto in writing tomorrow. I shall accordingly cable further when I receive his answer.
In the meantime, will the Department please answer the query contained in first paragraph of my 96, April 17, 11 a.m., as well as deal with the assumptions contained in the first paragraph of this telegram?