835.5151/623: Telegram

The Ambassador in Argentina ( Weddell ) to the Secretary of State

16. I delivered yesterday to the Minister of Foreign Affairs a note substantially following the draft indicated in the Department’s 15, February 2, 2 p.m., except for an addition to the effect that by exchange matters my Government refers obviously not only to exchange control but also to the 20 per cent surcharge. The Minister promised to give the note prompt consideration.

With his approval I also handed a copy to the Minister of Finance.26 On reading it the latter reiterated his recent statements to me, namely:

1.
That although there is a possibility of the abolition of exchange control there is no immediate prospect of this.
2.
That abolition of exchange control would not entail the abolition of the 20 per cent surcharge on goods not receiving previous import permits and that this latter system must be retained to secure a measure of control over imports.
3.
That it is the policy of the Argentine Government to grant as much official exchange as is created by the purchase of Argentine goods and that this rule was being applied impartially to all countries.

I emphasized with the Finance Minister the importance of public opinion in the United States, as set forth in the Department’s concluding paragraph. In this connection I also told him that I hardly thought my Government would admit the 20 per cent surcharge as a bargaining point in any trade agreement discussions. The Minister promised to discuss at once with the Foreign Office the note I gave him and to send me a memorandum at an early date.

I have also been recently pressing the Minister for an extension of the list of commodities granted official exchange; this he intimates is contingent upon negotiations for a trade agreement.

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Figures for 1936 showing the amount of official exchange allowed the United States (1) for exports to Argentina and (2) for debt and other services are promised within a fortnight by exchange control office.

While I am doing my utmost to secure the abolition of exchange control and the elimination of other discriminations against our trade, it is my impression that Argentina will insist upon substantial concessions from us before any favorable action will be taken, due among other things to the protective character of the 20 per cent surcharge as regards British exports to this country. Possibly Argentina might be more lenient if there was some assurance that the British Government would not insist upon a too strict interpretation of the Anglo-Argentine trade agreement.27

I respectfully suggest that the Department, particularly in view of the recent visit of Mr. Runciman,28 might find it worth while to explore in London this aspect of British-Argentine relations.

Weddell
  1. Roberto M. Ortiz.
  2. Signed December 1, 1936; for text of treaty see British Cmd. 5324, Argentina No. 1 (1936).
  3. Walter Runciman, President of the British Board of Trade.