Office of the Historian
  1. Home
  2. Historical Documents
  3. Foreign Relations of the United States Diplomatic Papers, 1939, The American Republics, Volume V
  4. Document 721

823.51/1297

The Peruvian Embassy to the Department of State

Memorandum

1.
—Trade between Perú and the United States has practically ceased, due to the impossibility of obtaining dollars on the Lima market. Moreover the demand made by American importers for the equivalent of cash payment, increases the difficulty;
2.
—In order to reestablish normal commercial intercourse with the United States, Perú requires without delay five to six million dollar credits;
3.
—The Central Reserve Bank of Perú would handle these credits, selling drafts for the imports from the United States to Peru. Peruvian importers would purchase from the Central Reserve Bank of Peru the drafts they need, paying for them in Peruvian currency at the exchange of the day. Thus, the total amount drawn in dollars would always be represented by Peruvian currency deposited in the Central Reserve Bank of Perú. The Peruvian Government would guarantee, through the Central Reserve Bank of Peru, any difference in the type of exchange at the date of settlement;
4.
—The Central Reserve Bank of Perú would apply to the amortization of these credits the amount paid in dollars by United States importers for Peruvian products;
5.
—It would therefore [be] to the advantage of all parties concerned if means could be devised to intensify the sale of Peruvian products in the United States. If for instance, the Export and Import Bank could take charge of marketing the sale in the United States of certain Peruvian products, such as cotton, paying 80% of their value upon delivery, and the 20% balance after the sale is effected.
6.
—It would seem advisable that an expert from the Export and Import Bank should go to Lima to settle the matter as soon as the basis for an agreement, as herein outlined, has been reached.
Washington , October 4, 1939.