The Chargé in Venezuela (Villard) to the Secretary of State
[Received December 28.]
Sir: I have the honor to refer to the Department’s telegram No. 54 of December 19, 3 p.m., instructing me to present a note to the Venezuelan Government on the subject of most favored nation treatment for the imports of certain goods from the United States, the benefits of which had not been received since the effective date of the recently enacted Venezuelan customs tariff. In accordance with the Department’s instructions, I obtained an appointment with the Minister for Foreign Affairs and this morning presented the note in question, a copy of which is attached for the Department’s ready reference.
The Foreign Minister at first stated that the objective of granting preferential rates on certain goods as provided for in the Franco-Venezuelan Commercial Agreement would be lost if such concessions were extended to all countries regardless of whether those countries were entitled by treaty to most favored nation treatment. He made [Page 961] this the basis for an argument to the effect that it constituted an excellent reason why the United States should negotiate a reciprocal trade agreement with Venezuela, under which preferential tariff rates granted to other countries would immediately be extended to the like products of American origin. If imports from the United States had until the enactment of the new Venezuelan customs tariff enjoyed the same treatment as imports from other countries, he said, it was because his Government had maintained a single tariff policy for all. This policy, he indicated, would now be changed in accordance with Venezuelan Government’s intention to accord trade favors only to those countries making concessions to Venezuela or entitled by treaty to most favored nation treatment.
When I pointed out that the United States had extended to Venezuelan commerce the concessions granted to other countries in reciprocal trade agreements, with the special exception of Cuba, the Minister stated that he had not realized this to be the case. A copy of the Trade Agreements Act10 was obtained, and after the Minister had perused its provisions, he admitted the existence of a situation which he had not been familiar with before. He thereupon said that he would go into the matter more fully and that as soon as he had completed his studies he would communicate with me.
Dr. Gil Borges stated that he was anxious and willing to do anything in this connection consistent with the policy of his Government if it would speed the initiation of negotiations for a trade agreement with the United States. He said he would take into particular consideration the items in the French Commercial Agreement regarding which American interests had displayed concern, namely silks, rayons and cosmetics, and would endeavor if possible to extend to these articles the tariff benefits enjoyed by countries having treaty relations with Venezuela. It was obvious, however, that the Minister was not fully informed on the subject and his “studies” will doubtless be made in consultation with the Minister of Hacienda.
Until my next interview, therefore, I am unable to report fully on the last sentence of the Department’s telegram of December 19, but it may be stated definitely that a recent customs circular gave instructions to extend the preferential rates in the French agreement to goods from all countries entitled by treaty to most favored nation [Page 962] treatment. The initiative in this, I understand was taken by the Italian Minister in Caracas, who was closely followed by the German Minister, their representations having had the effect of obtaining in regard to the items specified in the French agreement the same treatment for all other countries which have a commercial agreement with Venezuela. The United States and Japan are, of course, notable exceptions.
The Foreign Minister said that he was prepared at any time to proceed with negotiations for a trade agreement and appeared desirous of discussing the various aspects of the subject immediately. I told him that the Department had informed me, in its telegraphic instruction of December 19, that it was giving careful consideration to this matter; but as the Legation first intimated to him some six months ago, in accordance with the Department’s instruction No. 73 of June 9, 1936, that the question of a trade agreement with Venezuela was “receiving the careful consideration of the appropriate officers of the Department”, it is becoming increasingly difficult to evade a more direct reply to the Minister’s oft-expressed interest in the subject.
- Approved June 12, 1934; 48 Stat. 943.↩