This memorandum outlines the current exchange control policy of the
Argentine Government, particularly as regards the United States. It is,
I think, the first clear official statement of its kind. The Department
will note the statement that the general situation in Argentina does not
make it possible for the exchange treatment applied to the United States
to be exactly the same as that granted to the countries that have signed
commercial agreements or treaties on any basis, but that it is the
intention of the Argentine Government to endeavor by all
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means to make it possible for such a
treaty to be concluded with the United States.
While later, on further study of this memorandum, I may have other
comment to make, I shall appreciate any possible comment by the
Department.
[Enclosure—Translation]
The Argentine Ministry of
Finance to the American
Embassy
Memorandum
I. The Argentine Republic has found it necessary to adopt the system
of exchange control in force at present, by reason of the obstacles
of different kinds created against the introduction of its products
in the consuming markets, whether it be in the form of prohibitive
tariffs, of quotas or of sanitary prescriptions.
Owing to the reasons to which reference is made, it has been
necessary to distribute available exchange on the basis of the
requirements which must be met and of the interest that such
requirements represent in our economy.
II. Once the obligations contracted through signed agreements are
covered, the Argentine Republic endeavors to distribute among the
remaining countries the available exchange in proportion with their
purchases from the Argentine Republic.
However, it is not always possible to distribute among the countries
with which no agreement exists, a quantity of currency equal to that
which would be fitting should such an agreement have been signed. In
effect, previous permits are granted with an advance which in
certain cases reaches 180 days before the arrival of merchandise and
it is indispensable to have the assurance that in the near future no
difficulties will be encountered for the exportation of Argentine
products to the country in question.
III. In order to insure the payment without restrictions or delays of
imported products in the proportion of purchases effected by foreign
countries, after a previous deduction of a reasonable quantity for
the payment of the foreign public debt, as has been done with regard
to agreements signed with different countries, it is necessary to
have a possibility of establishing with a time in advance the volume
of purchases effected in the Argentine Republic.
IV. The figures supplied by the Exchange Control Office regarding
public, national, provincial and municipal debt services paid to the
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United States are
correct. They reflect the exact value of transfers effected in the
course of each year relative to this item.
Our Government had had to display real efforts to succeed in having
the nations with which it has concluded agreements contribute to the
payment of the public debt in countries whose commercial interchange
does not show a sufficiently favorable balance for Argentina;
without this the restrictions on the granting of currency to said
countries would have been even greater.
V. Our Government fully appreciates the contribution towards its
progress represented by the investment of foreign capital and
especially capital from the United States and it wishes to dissipate
the impression transmitted by the Ambassador concerning the purpose
of deliberate treatment which might prejudice the investors. This
misunderstanding may have as a basis the comparison of our figures
of interchange referring to only one of recent years. If a study is
made of permits granted during the years 1933 and 1934 as compared
with figures of the total interchange of those years, it will be
admitted that our Government has endeavored to be broadly liberal in
the midst of difficult circumstances through which it has passed
during that period. It is evident that the comparative liberality
prevailing during those years stands in contrast with the figures of
interchange registered in 1935, due to somewhat artificial
circumstances, as is recognized by the Ambassador. However,
confronted with those figures, the granting of permits has
maintained a discreet proportion.
Unfortunately, and for the time being, the general situation does not
make it possible for the treatment applied to the United States to
be exactly the same as that granted to the countries that have
signed commercial agreements or treaties on new bases, but it is the
intention of this Government to endeavor by all means to make it
possible for such a treaty to be concluded with the United States,
because it is desirous of being able to give the proper treatment to
the commercial and spiritual relation connecting it with that
country. Until such time as this purpose is realized,—a purpose
common to both countries,—this Department will do all in its power
to improve that treatment in order to contribute to create grounds
of understanding which may make it possible for the desire to sign a
commercial treaty promptly to be put into practice.
The treatment imposed so far has been due to circumstances foreign to
the will of Governments, it being indispensable—I repeat—to obtain
in future the necessary guarantees so that our regular exports to
the United States may be facilitated with the same liberality
granted by that country to imports of other origin.
Buenos Aires,
April 17,
1936.
