Foreign Relations of the United States Diplomatic Papers, 1940, The American Republics, Volume V

561.333D3/45

Memorandum by Mr. Paul C. Daniels of the Division of the American Republics

[ Washington ,] July 8, 1940.

Third Pan American Coffee Conference

report on activities from july 4, 1940 to july 6, 1940 (closing date)

In continuation of my report of July 3, 1940, reporting on the activities of the Third Pan American Coffee Conference up to July 3, 1940, there are reported below further developments up to and including July 6, 1940, the closing date of the Conference.

As indicated in section 8 of the report of July 3, a plenary session of the Coffee Conference was held on July 6 in the offices of the Pan American Coffee Bureau, 120 Wall Street, New York. At this meeting the quota plan of July 2 was discussed and argued at great length. The delegates of a number of the countries stated that the plan was acceptable. Among the remaining delegates, the following reservations or points of view merit specific mention:

Brazil

In accepting the plan, Sr. Penteado said that it should not be for more than one year, and that Brazil felt that its percentage of the United States market should subsequently be increased to 60 per cent from the 58 per cent (approximately) participation provided for in the plan. He added that Brazil wished the United States to cooperate effectively in making the plan successful.

Cuba

The Cuban delegate, Sr. Alberto Ortega, said that under his instructions he was unable to accept the plan for the reason that the Cuban quota of 80,000 bags represented a decrease of 26,000 bags from Cuba’s 1939 exports to the United States, while the quotas for many other countries were larger than their 1939 shipments to the United States. He said Cuba wanted last year’s shipments to the United States as a quota.

Nicaragua

Nicaragua has consistently sought a quota of not less than 200,000 bags, but will accept the quota of 195,000 bags provided under the plan if all the other governments accept the plan.

Ecuador

The delegate had received no instructions, but thought that Ecuador would probably accept the plan.

Guatemala

No instructions had been received.

Mexico

No instructions had been received.

Puerto Rico

Puerto Rico expressed no views on the plan, considering that it was a question to be determined by the other delegates since Puerto Rico is within the customs territory of the United States and therefore the quota plan does not apply to it.

Venezuela

The Venezuelan delegate was not present at this meeting of July 6.

After a lengthy exchange of views among the delegates, a resolution was introduced reading as follows:

“The Third Pan American Coffee Conference

Resolves

“To ratify in all its parts Resolution No. 7⁷ approved at the plenary session on July 2, 1940, which establishes a system of export quotas for the United States, and to charge the Pan American Coffee Bureau with its regulation and execution.”

Two difficulties arose in connection with the foregoing draft resolution. In the first place, since some of the delegates lacked instructions, it was deemed necessary to insert the phrase “ad referendum” after the word “ratify”. In the second place, the Brazilian delegate insisted that the resolution contain some indication that the Government of the United States would be involved in the execution of the plan. However, the Colombian delegates (Sr. Manuel Mejía and Dr. Rafael Parga) said that they had no instructions to agree to any plan contemplating Governmental intervention. After a lengthy discussion of this point, the resolution was amended to read as follows:

“The Third Pan American Coffee Conference

Resolves

“To ratify ad referendum in all its parts Resolution No. 7 approved at the plenary session on July 2, 1940, which establishes a system of export quotas for the United States, and to charge the Pan American Coffee Bureau with its regulation and with establishing contacts with all the interested governments or entities to obtain their approval and execution.”

The Brazilian delegate approved the resolution in that form, with the expressed understanding that the United States Government was an “interested” Government and that therefore the Pan American Coffee Bureau would establish contact with it to obtain its approval and cooperation in executing the plan.

On the other hand, because of the reference to “government” contained in the resolution, the Colombian delegation refrained from voting on it. Sr. Mejía stated, however, that he would consult his principals in Bogotá with a view to seeing if the resolution could be accepted by Colombia in its present form.

The other delegates approved the resolution, with the exception of Cuba, which abstained from voting for the same reason set forth above. It was agreed that the Pan American Coffee Bureau would continue discussing the matter during the coming week, and Sr. Aguilar told me that the Pan American Coffee Bureau would thereupon get in touch with the State Department.

Before the Conference adjourned a number of other resolutions were passed, covering the following subjects:

(1) Requesting increased contributions from the producing countries to the Pan American Coffee Bureau for advertising and propaganda;

(2) Requesting the Pan American Coffee Bureau to establish contact with the interested governments and to inform them of the results of the Conference;

(3) Charging the Pan American Coffee Bureau with continuing its efforts, through the Inter-American Financial and Economic Advisory Committee in Washington, to bring about a restriction on the imports into the United States of coffees of inferior quality;

(4) Expressing thanks to the Associated Coffee Industries of America and other representatives of the trade for their cooperation; and

(5) Expressing appreciation for the sympathetic attitude of the United States Government towards the Conference.

After the adjournment of the meeting on July 6 and the closing of the Conference, I discussed in further detail with Sr. Mejía and Dr. Parga the question of the Colombian attitude regarding cooperation by the United States Government in making the quota plan effective. Following this discussion Sr. Mejía indicated that he would explore further the possibility of an international agreement on coffee to which the United States would be a party, such agreement to be of an emergency character (possibly for the duration of the war) and subject to termination on suitable advance notice whenever any participating government desires to withdraw. When I last left Sr. Mejía on July 6 he seemed to think that some such formula might be acceptable, and said the matter would be examined very carefully. Dr. Parga, who plans to return to Bogotá on July 11, seemed the more doubtful of the two.

Sr. Mejía said that he planned to remain in New York so long as there was any chance of an agreement being reached.

Since the Pan American Coffee Bureau, 120 Wall Street, New York, has been charged by the Conference with further activities in connection with the proposed quota plan, further information on the general subject can doubtless be obtained from that source. At the same time, as indicated above, Sr. Aguilar of the Coffee Bureau told me that he planned to communicate with the Department in the course of the next week, and would be prepared to come to Washington if necessary.

7. Supra.