611.8331/139
Memorandum of Conversation, by Mr. James C. Sappington of the Division of Trade Agreements
| Participants: | Dr. Richling, Uruguayan Minister |
| Mr. Sayre7 | |
| Mr. Daniels8 | |
| Mr. Sappington |
Mr. Sayre stated that the existing exchange situation in Uruguay as it affects American exports to that country is a matter of great concern to this Government. In this connection, he informed Dr. Richling of the views expressed to the Uruguayan Government by the American Minister at Montevideo in accordance with the Department’s telegraphic instruction of January 14, 1938.9 It was made clear to the Minister, however, that there was no connection between our concern in regard to the exchange treatment now accorded American products in Uruguay and the purpose of the present conversation regarding the possibility of negotiating a trade agreement with Uruguay.
The purpose of the trade-agreements program in its relation to the maintenance of world peace was outlined to Minister Richling, and the advantages to be obtained from the furtherance of multilateral trade as opposed to bilateral balancing of trade, were stressed. Dr. Richling agreed that the fostering of multilateral trade was essential in the long term view but presented the economic necessities of his country as requiring the immediate following of the bilateral principle. The Minister stated that his Government as a political matter [Page 898] agreed with and strongly supported the principles advocated by the United States but indicated that the difficulty for the Uruguayan Government lay in reconciling its political views with the economic necessities of the country.
Reference was made to the desire of the Uruguayan Government for a trade agreement with the United States. Mr. Sayre stated that, as the Minister was aware, informal conversations have been undertaken with the Argentine Ambassador for the purpose of ascertaining whether trade-agreement negotiations might be initiated with Argentina;10 that as yet we did not know whether such negotiations could be initiated. However, in view of the similarity between Uruguay’s and Argentina’s export trade with the United States it seemed desirable that negotiations with the two countries be concurrent, if possible. Consequently, because of the possibility of trade-agreement negotiations with Argentina we wished at this time to ascertain the views of the Uruguayan Government respecting a trade agreement. Dr. Richling said that he had previously been promised by officers of the Department that a trade agreement would be negotiated with Uruguay at the same time as an agreement is negotiated with Argentina.
The customary procedure followed here in negotiating trade agreements was outlined and a memorandum,11 a copy of which is attached, stating the basis upon which this Government would expect to conduct trade-agreement negotiations with Uruguay, was handed the Minister. In reply to an inquiry concerning the basis for negotiations Dr. Richling was informed that this Government would expect the removal of any discriminations in regard to customs duties and quotas, and would expect exchange to be allotted for American products at a rate not less favorable than that accorded any other nation. This last would mean that all American products would be permitted entry into Uruguay at the most favorable rate of exchange.
Dr. Richling inquired as to what he could tell his Government regarding the nature of duty concessions the United States would be prepared to grant Uruguay in a possible trade agreement and, in this connection, specifically mentioned the duty on meat products. He was informed that no answer could be given him at this time in regard to a possible duty reduction on meat products but that both governments would have to be prepared to make duty concessions in any trade agreement negotiated; that this Government would expect to make such concessions on products of interest to Uruguay in return for concessions granted by that country on American products.
The desirability of proceeding as rapidly as possible because of the approaching elections in this country, if negotiations are to be undertaken [Page 899] with Argentina and Uruguay in the near future, was indicated. Because of the length of time it will take Dr. Richling to reach Montevideo (he is sailing on January 29 from New York), the question was raised as to how this Government’s position with respect to the basis for trade-agreement negotiations should be presented to the Uruguayan Government in the event negotiations with Argentina should be initiated prior to Dr. Richling’s arrival in Montevideo. In the latter event it was decided, at Dr. Richling’s suggestion, that the subject should be presented to the Uruguayan Government by the American Minister at Montevideo.