611.006 Meat/13
The Uruguayan Chargé (Gorri) to the Secretary of State
Mr. Secretary: With all due respect for the Honorable Secretary of State, and in the certainty that this note will serve only to draw his attention to one fact which conflicts with the principles repeatedly maintained by Your Excellency and by the President of the United States himself, “regarding the havoc resulting for the commerce of the world from an exaggerated protectionism in its numerous forms, or a blind search for an extreme economic nationalism” and [conflicts]25 [Page 906] directly with Uruguayan interests, I take the liberty of setting forth the reasons which move me to do so.
The fact is, that the Congress of the United States, at this time, when Uruguay, faithful to the policy of the good neighbor maintained by the United States in her relations with the countries of Latin America, is renewing its proposal to initiate negotiations for the conclusion of a Commercial Agreement, is planning to increase by three cents a pound the duties on canned meats.26
Uruguay saw a considerable diminution in purchases by the United States in the year 1937, which fell from £2,700,000 in 1936 to £990,000 in 1937, while on the other hand Uruguay’s purchases rose from £1,270,000 in 1936 to £2,138,000 the following year.
If that phenomenon occurred under the present duties, it is conceivable that if the increase of three cents is approved, i. e. the imposition of an increase of 50 percent on imports of canned meats, purchases by the United States from Uruguay will diminish in proportion to this increase, which is unjustifiable in the case of foodstuffs.
The present duty of $0.06 a pound is equivalent to 20 Uruguayan pesos for each steer of the kind intended for canned meats, of an average weight of 420 kilos. If the proposed increase of $0.03 were applied, the equivalent would increase to 30 Uruguayan pesos per steer, which compared with that applied by England, 15 Uruguayan pesos per chilled steer, i. e. of a quality superior to the former, would be twice as much.
Uruguay has followed a friendly and truly cordial policy with respect to the United States, as it has given it a treatment which may be expressed in the following terms: despite our laws for control over imports which we apply in general to all countries:
- 1.
- It has applied the most-favored-nation treatment to the United States, conditions being equal.
- 2.
- In order to permit its imports on the most advantageous conditions, it granted advances of quotas during the year 1937.
- 3.
- At the time when the scarcity of foreign exchange was most felt Uruguay permitted the entry of all agricultural machinery, implements, machinery in general and raw materials, and encouraged purchases from the United States, including even automobiles and other luxury articles, all of American origin, which aroused a protest on the part of countries with which there were agreements and available foreign exchange balances, because of the fact that they had not received a treatment equal to that of the United States.
- 4.
- While severe restrictive measures were applied with respect to other countries, to the point that the entry of articles necessary to [Page 907] industry and commerce was not permitted, Uruguay authorized the importation of American articles.
To this policy practiced by Uruguay in 1937 there is added the real desire to maintain it by means of a trade agreement; in return, the United States undertakes to increase by 50 percent the duties on imports of canned meat, the product of greatest commercial importance in this friendly country, which would lead, as an economic consequence, to the shrinking of the business of the United States with Uruguay to insignificant figures.
On the other hand, if the increase of $0.09 continues as an unchangeable fact, without new resources being obtained, being incorporated into the act which is being debated in Congress, the result will be practically null; it is amply proved that both increases in tariffs and those in internal revenue rates, even when articles of prime necessity are involved, are made in inverse ratio to the increase in resources, and Your Excellency demonstrated that irrefutably in your splendid speech on “Trade, Prosperity and Peace”,27 made on February 6th last, from the studios of the National Broadcasting Company, in cooperation with the Committee on Economic Policy.
Approval of this act, increasing the rates of duty on imports of canned meat from Uruguay by 50 percent, will therefore mean a death blow to the trade which my country has maintained with the United States, and, as a logical consequence, as its purchasing power diminishes and it consequently becomes poorer by figures in the millions, it will cease to purchase products of American industries to an equal or greater extent.
Cherishing the hope that there may be means for avoiding the danger that is hovering over the export trade of Uruguay with the United States, to take up fully the discussion of the possibilities of a trade agreement between the two countries, I avail myself [etc.]