835.796/186: Telegram

The Ambassador in Argentina (Armour) to the Secretary of State

1070. Department’s 721, September 30, midnight. The Embassy feels that there is little or no opportunity of Air France’s permit being revoked by the Argentine Government at this time. This opinion is shared by Bradley, president of local company for Pan American Airways, who is well acquainted with Argentina’s air transportation situation. However Bradley expresses the personal opinion that Air France planes should not be allowed to operate under French registry if the line does not actually connect with France. It is doubtful whether the increased Panagra services between Buenos Aires and Santiago would be sufficient argument to induce Argentina to revoke Air France permit and it is felt that the RFC project should not be mentioned at this time. Furthermore, it is believed that Argentina would like to have as many air services as possible of different nationalities as evidenced by fact that it countenances Lati.

As mentioned in Embassy’s 1052, September 29, general manager of YPF denied possibility of contract with Lati for 100,000 liters monthly but admitted Lati was receiving small normal quantities for Argentine requirements. Last night a member of the Embassy staff informally discussed this matter with another official of YPF named Benassar who disclaimed knowledge of even the small monthly sales by YPF to Lati. There seems to be no doubt that YPF is selling Lati approximately 10,000 liters a month which possibly bears out a suspicion that one section of YPF does not know what another section is doing. Benassar did say that an application had just come across his desk for 100,000 liters of aviation gasoline to be shipped to a firm in Porto Alegre whose name he did not recall. He said he would recommend rejection of the application and that he could count on the support of virtually all YPF officials.

While it now appears unlikely that YPF will continue with any negotiations it might have had under consideration for sale of 100,000 liters monthly to Lati there are several factors which are still questionable. In the first place I am not certain whether my representations [Page 348] to the Foreign Office on this matter have been transmitted in full force to YPF. It is also possible that high Argentine officials might look with approval on negotiations with Lati. There is also the apparent lack of coordination within YPF itself.

Consequently I feel that the only way we are going to get definite information is by asking the Argentine Government for a statement as to its policy concerning a difference of opinion vis-à-vis Lati. I believe such an inquiry would be more effective if it were made by the Department to Espil.60 At the same time and while I appreciate the position outlined in telegram No. 1299 of September 17, 8 p.m., from the Embassy at Rio de Janeiro to the Department,61 I feel that we should be prepared to justify our position in asking Argentina not to sell to Lati when Intava is selling to both Condor and Lati in Brazil and Condor in Argentina.

Paraphrase to Rio de Janeiro by courier.

  1. Felipe A. Espil, Argentine Ambassador in the United States.
  2. Not printed.