The Chargé in Costa Rica (Drew) to the Secretary of State

No. 778

Sir: I have the honor to report that in accordance with the Department’s Instruction No. 180 of July 9, 1935,2 I called on the Minister for Foreign Affairs on July 15th, accompanied by Vice Consul Satterthwaite, to inform him that I had received from the Department of State information on the concessions which would be requested of the Costa Rican Government in the proposed reciprocal trade agreement.

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Mr. Gurdián requested me to submit a list of the commodities on which reductions would be requested before proceeding to discuss them orally. I agreed to do this, at the same time emphasizing my opinion that it was highly desirable to avoid a protracted exchange of formal correspondence, with which Mr. Gurdián agreed. He stated that inasmuch as all details of the trade agreement would have to be submitted to the Minister of Finance and Commerce, he planned to meet with the Minister of Finance, Mr. Satterthwaite and myself to consider the proposed concessions.

Mr. Gurdián informed me that he had studied the proposed draft of the agreement, and that while he found it acceptable in general, there were certain clauses which he wished to change. I informed him that the text submitted was merely a draft and did not even represent the final word of the Department of State. He stated that he had already submitted the proposed text to President Jiménez.

A statement which Mr. Gurdián attributed to the President furnishes an interesting commentary on the Costa Rican Government’s attitude toward the proposed agreement.

“Ask Mr. Drew why the American Government wants to change things. We are perfectly satisfied with the present situation, and if they so desire I would be willing to sign an agreement to continue the status quo for a hundred years”.

Mr. Gurdián again referred (see my Despatch No. 769 of July 9, 1935)3 to his desire to give full publicity to the proposed terms of the trade agreement in order to give to any Costa Ricans who might be interested in securing concessions from the United States on certain commodities, an opportunity to present their views. It was agreed with Mr. Gurdián that all publicity in connection with negotiation of the trade agreement would be given out from his office, in order to avoid any possibility of conflict.

In the course of recent conferences with Mr. Gurdián on the trade agreement, he has referred to his desire to obtain certain minor concessions from the American Government, particularly in connection with the sale of fruits and vegetables to the Panama Canal Zone commissaries. I informed Mr. Gurdián that this subject would, of course, be given consideration by the Department of State. I believe that while such a concession might not be of great value in stimulating trade in these commodities with the Canal Zone, it would be of great assistance in securing concessions from the Costa Rican Government with regard to Schedule I and would materially assist in the successful conclusion of the agreement with Costa Rica. While Mr. Gurdián has not given any indication of the nature of the concessions desired [Page 451]to stimulate trade with the Canal Zone, it is my opinion that such a request when made should be given most careful consideration.

In accordance with Mr. Gurdián’s request, I today submitted to him informally a list of the commodities in Schedules I and II,4 setting forth only the prevailing and the proposed duties, without attempting to include statistics or any discussion of the merits of the proposed concessions. I received the impression that his first reaction to the list of concessions was more favorable than I had anticipated, as he expressed approval of the proposed reduction in duties on certain minor commodities. He did, however, state that he thought it would be very difficult to grant any concession in the duties on wheat flour in view of the importance of the income from that source to the Costa Rican Government. The Foreign Minister informed me that he would transmit copies of the list to the President and the Minister of Finance and Commerce for their information, and as soon as he received certain statistical data he would be ready to initiate discussion of the agreement.

Respectfully yours,

Gerald A. Drew
  1. Missing from Department files.
  2. Not printed.
  3. Schedule I, rates on imports into Costa Rica from the United States; Schedule II, rates on imports into the United States from Costa Rica.