The Chargé in Uruguay (Dominian) to the Secretary of State

No. 983

Sir: I have the honor to inform the Department that in the course of a conversation that I had this morning with the Minister for Foreign Affairs he informed me that he had recently been subjected to pressure on the part of the Uruguayan cattle interests for the purpose of inducing him to initiate negotiations looking to the conclusion of a trade agreement with the United States. The Minister informed me that the cattle interests, which wield considerable influence in Uruguay, have been complaining considerably of late about alleged inactivity on his part to discuss a trade agreement with the United States, which they believe would improve their economic situation and that in consequence delegations of cattle raisers from various sections of the country were visiting him daily and asking that he endeavor to negotiate a trade agreement with the United States at once.

I may state that this was the first time in which I noted that the Minister showed visibly his desire to hasten the initiation of trade negotiations. His attitude led me to think of the really difficult economic situation now prevailing in Uruguay for various causes, among which may be cited the inability of the wool growers to dispose of their products, as reported in my Confidential Despatch No. 974, of February 18, 1935,3 and the fact that the recently-concluded trade agreements with a number of European countries do not appear to have resulted in an increased disposal of Uruguayan exportable commodities. [Page 948] An unfavorable situation is thus created for the Government, which, its members apprehend, will increase the number of partisans of the dissatisfied factions. Minister Arteaga inquired why so much delay was occurring in the initiation of a trade agreement, and showed me a despatch from Minister Richling, written sometime in December last, in which the Uruguayan Minister informed the Ministry of Foreign Affairs that he had been given assurance at the State Department that discussions on a commercial treaty with Uruguay would be begun simultaneously with the negotiations to be undertaken with Argentina for a similar purpose, and that the matter of a commercial agreement with Uruguay would not be postponed until negotiations with Argentina had been concluded.

I informed the Minister that I was unable to give him information regarding the date at which negotiations for commercial agreements with Argentina or Uruguay would be initiated, but that I would not hesitate to give him any information on the subject which I might have later on.

The Minister then expressed himself with definite emphasis as being prepared to grant anything possible in the way of concessions to American trade, particularly in the way of removal of the present exchange difficulties, if it were possible for the United States Government to reduce the present tariff on meat as a facility to the cattlemen of his country.

He also told me that he would agree to an unconditional most-favored-nation clause stipulation in a trade agreement with a country having such economic importance as the United States. However, he was still opposed to this stipulation when dealing with countries of minor economic importance or when purchases of Uruguayan products were slight.

It is also possible that the sense of urgency which undoubtedly prompted the Minister in his talk with me this morning is due partly to the slowness characterizing the trade negotiations which have been going on between British and Uruguayan delegates in London. Less than a week ago the British Minister expressed himself to me as not being hopeful about the possibility of a speedy conclusion of a trade agreement with Uruguay. This circumstance, added to the diverse factors underlying the general Uruguayan economic situation, as reported above, probably led the Foreign Minister to indicate to me, with plain manifestation of his desire for speedy action, the readiness with which he would undertake negotiations for a trade agreement.

Respectfully yours,

  1. Not printed.