The Secretary of State to the Minister in Ecuador (Long)
Sir: Reference is made to your telegrams nos. 42, 43 and 44 of May 30, June 1 and June 2, 1939,38 respectively, and to your despatches nos. 497 and 510 of May 26 and June 2, 1939, respectively,39 regarding the question of securing the compliance of the Ecuadoran Government with the import control provisions of the trade agreement between the United States and Ecuador.
With the exchange of notes between the Foreign Minister and yourself, the formal action called for by the provisions of the trade agreement may be considered to have been fulfilled. In its revised form as reported in your telegram no. 44, however, the Foreign Minister’s note of June 2 is not completely satisfactory, but it is believed that it may be considered adequate. For example, in the first paragraph Dr. Tobar states that “while the system of control of importations is in effect”, imports from the United States may be limited to 40,000,000 sucres. The qualification in your note of May 30 read “as a temporary measure pending further clarification of the Ecuadoran import system”. In case future difficulties should arise on this point, reference may be made to the terms of your note.
As another example, the elimination of the fourth paragraph of the original draft of the Foreign Minister’s note, while satisfactory in removing any connection with the law of March 3, 1939, also removes the minimum percentage figure of total Ecuadoran imports which the 40,000,000 sucres are to represent. However, the third paragraph of Dr. Tobar’s note of June 2 states that his Government “will take strictly into account” the proportion of Ecuador’s total imports supplied by the United States in the years 1936–38, inclusive.
Regarding the question of giving publicity to the arrangement, the Department appreciates the reasons advanced by the Foreign Minister [Page 624] for wishing to avoid publishing the terms of that temporary agreement. However, the provisions of article VIII of the trade agreement provide for the giving of public notice of the amounts of permitted imports. Further, traders in both the United States and Ecuador are entitled to have that information. The Department is of the opinion, therefore, that the Ecuadoran Government should in the near future issue a statement along the lines of that which the Department proposes to issue here. This statement, a copy of which is enclosed,40 gives the substance of the arrangement worked out with the Ecuadoran Government, and the Department would like to issue it concurrently with the release of a similar statement by the Ecuadoran Government. You may show the enclosed draft to the Foreign Minister, indicating our desire to have statements issued simultaneously in Washington and Quito. Any release date after you receive this instruction would be satisfactory to the Department, and you should telegraph a few days in advance, information as to the date that may have been selected by the Foreign Minister. If Dr. Tobar declines to issue a statement in Quito, you should inform him that your Government feels that such action is necessary in view of the provisions of article VIII and the importance of informing traders in both countries. You may also inform him that the Department intends to issue a statement in Washington whether or not one is released in Quito.
There remains the further matter of assuring that the arrangement set forth in the notes will be carried out in practice, that is, not only will not less than 40,000,000 sucres of imports be permitted to enter Ecuador from the United States during 1939, but that amount will represent in relation to total imports into Ecuador, not less than the proportion (34 percent) of such total supplied by the United States in the period 1936 to 1938, inclusive. In order to do this, it will be necessary for you to ascertain, as soon as possible, the value of imports into Ecuador from the United States during the first five months of the present year (that is, up to the approximate date of the conclusion of the recent agreement). On the basis of that information, it will be possible to determine what part of the permitted total of 40,000,000 sucres for the United States has already been supplied by this country, and the balance which remains for the rest of the year. Each month during the remainder of 1939 you should ascertain the amount of imports into Ecuador from the United States and from all countries and report this information to the Department.
Please continue to keep the Department currently informed regarding the questions discussed above.
Very truly yours,