632.6231/69: Telegram

The Ambassador in Brazil (Gibson) to the Secretary of State

149. Data contained in the Department’s 81, June 3, 5 p.m.,16 has been of great value.

[Page 268]

Although signature of a provisional trade agreement on a compensation mark basis has been averted, I feel we must not ignore the constant pressure that will be exerted for objectionable arrangements of one sort or another, not only with Germany but with numerous other countries which are holding out tempting offers. It would, therefore, be helpful if the Department could afford me for my guidance as much material as may be available on this general subject together with any instructions of a general character that it may care to give me as to our desiderata.

There is a persistent effort being made here to create the belief that our objection to the compensation mark agreements is prompted by our desire to exclude Brazil from the German market for her cotton. I learn confidentially that at today’s meeting of the Federal Foreign Trade Council, presided over by President Vargas, the Chief of the Government’s Statistical Bureau submitted figures to demonstrate this and apparently made a considerable impression on those present.

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