810.20 Defense/1071b: Telegram

The Acting Secretary of State to the Ambassador in Chile (Bowers)

202. The Department on July 9 handed to the Chilean Ambassador a draft of basic agreement49 for the lend-lease program of transferring military matériel to Chile. The principal financial provisions are as follows: Chile is to receive a total of $50,000,000 of war and navy matériel of which it is expected $15,000,000 of army matériel and $1,000,000 of navy matériel will be transferred during the fiscal year ending June 30, 1942. This delivery date is subject to change if broad defense considerations so require.

With respect to repayment, Chile is expected to pay $2,500,000 in each fiscal year until 1947, making a total of $15,000,000 to be repaid prior to June 30, 1947. In consideration of the broad objectives of the [Page 573] program and of certain very general economic concepts, the entire obligation of Chile to the United States would be considered discharged by such payments.

The Ambassador expressed his gratification at the generous treatment to be accorded Chile, and indicated that he would at once transmit the draft agreement by airmail to Santiago.

  1. Not found in Department files, but see draft printed on p. 139.