611.2231/445: Telegram
The Secretary of State to the Minister in Ecuador (Long)
60. Your despatch 1046, May 3048 and our telegram 58, June 4. The Department has examined the trade statistics in your despatch 1046 and considers that the proposed restrictions on the nine tariff items mentioned in your telegram 8349 would be acceptable on the basis explained therein. Our calculations show that average annual imports during the last 4 years from all countries of those items amounted to 14,280,067 sucres, one-quarter of which would represent the total permitted imports for the 6-month period beginning June 10.
It is strongly suggested that the proposed restrictions be placed on a global basis for each item and not be allocated among individual supplying countries. This would be simple to administer and the Ecuadoran Government would thus achieve restriction of total imports without substantially affecting our trade position. For your own information this procedure would permit our exporters to obtain a share of permitted imports in line with current trade and shipping conditions.
We are agreeable to the quota restrictions being announced and becoming effective on June 10 and applying to goods in transit as well as to future shipments, provided we receive confirmation of the foregoing from you by June 8 in order to permit simultaneous announcement here on June 10. Our announcement will mention invoking of the currency safeguard clause of Article VII by Ecuador in view of the exchange emergency caused by export difficulties and recent excessive imports; consultation with and agreement by this Government regarding the proposed measures for a period of 6 months; set forth statistically the effect of the proposed restrictions and the manner in [Page 866] which they will operate; and mention in general terms the proposed increases in duties on non-schedule products.
Regarding the latter question, we feel that there should be exemptions for goods for which export documents have already been approved by Ecuadoran consuls prior to or on the date of the decree imposing increased duties. Please telegraph full data on proposed duty increases, in order that this information may be given in detail to our exporters through the Department of Commerce.