611.3531/559
Memorandum of Conversation, by the Economic Adviser (Feis)
Upon appointment made over the telephone, the Argentine Ambassador came in to see me, accompanied by Mr. Irigoyen, the Financial Counselor. The Ambassador wanted to discuss various points connected with the question of the possible inauguration of conversations between ourselves and the Argentine Government for a trade agreement.
The points covered were as follows:
(1) The Ambassador stated that before cabling to his Government the note which had been presented to him by Mr. Sayre he wanted to be able to advise his Government as to whether we would be willing at once to engage in informal discussions, wholly without commitment, regarding the general outlines of what the trade agreement would be like. He stated that his understanding was that we engaged in such prior informal conversations in many other instances. I replied that he had not given me previous notice over the telephone of this question and that I was not in a position to answer, but that I was sure that Mr. Sayre would be glad to consider it when he met the Ambassador again tomorrow afternoon (of which fact the Ambassador had already apprised me). The Ambassador said he was planning to raise the question again, thereby indicating that he had raised it before with Mr. Sayre, whom he believed to have indicated in turn that we would not enter into such prior informal conversations before agreeing to make formal announcement.
(2) He then asked whether, as regards the paragraph in the Aide-Mémoire which had been handed him suggesting that the Argentine Government give us complete unconditional most-favored-nation treatment in exchange matters, we realized that it might mean we were asking Argentina to dismantle its whole exchange control and surcharge system, and possibly even discard various bilateral agreements to which Argentina is a party. I stated that our intention was simple. [Page 227] We wished to be assured that American trade would enjoy as favorable exchange treatment as the trade of any other country; and since the trade of some other countries, e. g., Great Britain, was given official exchange for virtually all its commodities and paid no surcharge tax, we felt that similarly all American trade should be given the same treatment. If that were done, our request would be satisfied. Mr. Irigoyen stated that he understood.
He raised the hypothetical question of what attitude we would take provided Argentina maintained some form of exchange control or exchange tax on specified commodities, irrespective of their origin. I replied that I could not give a definite answer offhand, but my surmise was that if the commodities were selected on the basis of some understandable and fair principle, so that it was clear there was no national discrimination, we would have no objection in principle, though we might regulate the restriction.
I arranged with the Ambassador and Mr. Irigoyen for Mr. Irigoyen to return tomorrow morning for further technical discussion of the exchange policy of Argentina and the exchange treatment accorded to this country.
(3) Just before leaving the Ambassador brought out the general question of why we could not wait to have this exchange matter settled as part of the trade agreement and I stated fairly emphatically our view that this was an injurious discrimination which the Argentine Government was in a position to rectify by its own action and without connection with trade agreement negotiations.
(4) The Ambassador asked me several scattered questions as to what might be contained in a trade agreement, and I told him that I couldn’t inform him at all reliably on specific points, but he could be sure our attitude would be one of positive endeavor to find terms of agreement, as shown by our whole record in this field.
The Ambassador expressed a wish that I should be present tomorrow during his conversation with Mr. Sayre and I said that I would mention that fact to Mr. Sayre.