The Department has now worked out in consultation with the Division of
Defense Aid Reports a draft text of basic agreement which would be
entered into by this Government with each of the other American
republics. The draft, which is enclosed, is worked out with special
reference to Brazil, and it is suggested that the only changes to be
incorporated in the drafts relating to the other American republics
would be in respect of the financial details appropriate to each
country. There is attached a table13 indicating the total amounts of matériel which it is
proposed to transfer to each of the other American republics and the
total amounts to be paid into the United States Treasury over a period
of six years.
This program is based on deliveries of matériel over a period of at least
three years and payments by the other American republics into the
Treasury over a period of six years. In the event that the emergency is
terminated before the expiration of these periods of delivery or
payment, it would probably be necessary and desirable to reconsider the
program and perhaps to modify the basic agreements in accordance with
the new circumstances.
If you approve the draft basic agreement and suggested schedule of
payments, the Department is prepared to begin immediate negotiations
with the representatives of Brazil, Colombia and eventually all of the
American republics.
[Enclosure]
Draft Text of Basic Agreement To Be Entered Into
With Other American Republics14
The President of the United States of America has determined,
pursuant to the Act of the Congress of the United States of America
of March 11, 1941,15
that the defense of each of the American republics is vital to the
defense of all, and for that reason the United States of America
proposes to provide certain defense articles and defense information
to the United States of Brazil.
The United States of America and the United States of Brazil do here
agree to the terms and conditions on which the obligations of the
United States of Brazil to the United States of America which
thereby arise shall be discharged.
Article I
The United States of America and the United States of Brazil declare
that in conformity with the principles set forth in the Declaration
of Lima they, together with all the other American republics, are
united in the defense of the Americas, determined to secure for
themselves and for each other the enjoyment of their own fortunes
and their own talents. To that end the defense articles hereunder
are to be delivered and in that cause they shall be used. With that
purpose in their minds the United States of America and the United
States of Brazil make this agreement.
Article II
Should circumstances arise in which the United States of America in
its own defense or in the defense of the Americas shall require
defense articles or defense information which the United States of
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Brazil is in a
position to supply, the United States of Brazil will make such
defense articles and defense information available to the United
States of America on terms similar to those expressed in this
agreement.
Article III
The United States of America proposes to transfer to the United
States of Brazil under the terms of this Agreement armaments and
munitions of war to a total value of about $100,000,000. The United
States of America proposes to begin deliveries immediately and to
continue deliveries as expeditiously as practicable during the
coming twelve months to an approximate total value of $15,000,000
for use by the Brazilian Army and an approximate total value of
$1,000,000 for use by the Brazilian Navy.
The United States of America, however, reserves the right at any time
to suspend, defer, or stop deliveries whenever in the opinion of the
President of the United States of America further deliveries are not
consistent with the needs of the national defense of the United
States of America or the Western Hemisphere.
Article IV
Records shall be kept of all defense articles transferred under this
agreement, and not less than every ninety days schedules of such
defense articles shall be exchanged and reviewed.
Thereupon the United States of Brazil shall pay in dollars into the
Treasury of the United States of America the total cost to the
United States of America of the defense articles theretofore
delivered less all payments theretofore made up to a total of
$35,000,000, and the United States of Brazil shall not be required
to pay more than a total of $15,000,000 before July 1, 1942, more
than a total of $19,000,000 before July 1, 1943, more than a total
of $23,000,000 before July 1, 1944, more than a total of $27,000,000
before July 1, 1945, or more than a total of $31,000,000 before July
1, 1946.
Article V
The United States of America and the United States of Brazil,
recognizing that the measures herein provided for their common
defense and united resistance to aggression are taken for the
further purpose of laying the bases for a just and enduring peace,
agree, since such measures cannot be effective or such a peace
flourish under the burden of an excessive debt, that upon the
payments above provided all fiscal obligations of the United States
of Brazil hereunder shall be discharged; and for the same purpose
they further agree, in conformity with the principles and program
set forth in Resolution XXV on Economic and Financial Cooperation of
the Second Meeting of the Ministers of Foreign Affairs of the
American Republics
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at
Habana, July, 1940,16 to cooperate
with each other and with other nations to negotiate fair and
equitable commodity agreements with respect to the products of
either of them and of other nations in which marketing problems
exist, and to cooperate with each other and with other nations to
relieve the distress and want caused by the war wherever, and as
soon as, such relief will be succor to the oppressed and not aid to
the aggressor.
Article VI
The United States of Brazil undertakes that it will not, without the
consent of the President of the United States of America, transfer
title to or possession of any defense article or defense information
transferred under this agreement, or permit its use by anyone not an
officer, employee, or agent of the United States of Brazil.
Article VII
If, as a result of the transfer to the United States of Brazil of any
defense article or defense information, it is necessary for the
United States of Brazil to take any action or make any payment in
order fully to protect, pursuant to the Act, any of the rights of
any citizen of the United States of America who has patent rights in
and to any such defense article or information, the United States of
Brazil will do so, when so requested by the President of the United
States of America.
Article VIII
The parties to this Agreement, and the officials signing this
Agreement on their behalf, each for itself, himself, or themselves,
represent and agree that the execution and delivery of this
Agreement have in all respects been duly authorized, and that all
acts, conditions, and legal formalities which should have been
performed and completed prior to the making of this Agreement have
been performed and completed as required by, and in conformity with,
respectively, the laws of the United States of America and the
United States of Brazil.
Signed in Washington in duplicate this . . . . . day of . . . .
., 1941.
On Behalf of the United States of
America
__________________________________
(Title)
On
Behalf of the United States of
Brazil
__________________________________
(Title)
