611.2231/82: Telegram

The Chargé in Ecuador (Sparks) to the Secretary of State

55. Referring to Department’s instruction No. 186, November 11th. It is the policy of the Ecuadorian Government to facilitate the importation of lard and particularly flour which are considered prime necessities. At present it has authorized the temporary entry of flour free of duty to be sold at cost. This policy, however, is applicable only to the quantity required to fill the deficiency between national production and absolute minimum consumption. Once this deficiency is supplied political and economic considerations will probably again dictate the prohibition of further imports thus preventing the increase of consumption beyond the margin of deficiency. Ecuador is now a price market for the shift of the source of supply to the Argentine Republic and Chile can be traced principally thereto. Consequently any benefits arising from reductions in import duties would accrue to those countries unless we can compete in price.

Under the circumstances the Department may desire to give further consideration to the expediency of emphasizing the importance attached to concessions on flour and lard. I shall await further instructions.