The Secretary of State to the Ambassador in Brazil (Caffery)
147. The Federal Loan Administrator has authorized us in his name to inform the Brazilian Government that he is prepared to take a firm commitment to loan funds necessary to purchase in the United States equipment for the installation and the operation of an iron and steel plant in Brazil on the understanding that such commitment shall become effective when he and the Brazilian authorities shall have agreed upon a plan for construction and operation. His purpose is the same as that of the Brazilian Government to assure that the enterprise will be soundly conceived and efficiently operated so that the investment of all parties will be safeguarded. He has prepared to proceed promptly with discussions looking towards carrying the plan to execution.
He adds that he has received reports to the effect that 10 million dollars would probably be sufficient for any enterprise that it would be advisable to try to establish now and this sum should be regarded as the outside amount of his commitment. However, should further study establish the fact that additional funds are needed, he would be willing to consider increase in the amount.
Confidential for your information: The Federal Loan Administrator is still firmly of the opinion that the best way in which it would be possible to assure well-planned and efficient construction and operation would be if an American steel company of experience had responsibilities in construction and operation. …