811.20 Defense (Wool)/310: Telegram

The Secretary of State to the Ambassador in Uruguay (Dawson)

278. Reference your 411, October 1. Has a report been received from the Foreign Office? The Department agrees with the suggestion that an agreement between the producers and Defense Suplies Corporation would not be satisfactory. The commercial treaties referred to in your 411 are concerned chiefly with customs duties, and it appears to the Department that it would not be inconsistent with those treaties for the Uruguayan Government to enter into an agreement with Defense Supplies Corporation and the British Government agreeing to sell to them a specified amount of hides and wool of certain grades, which amount would be in excess of the recent production of Uruguay. The agreement would also provide that the Uruguayan Government would not be under liability for failure to obtain and sell the maximum amounts of hides and wools specified; its obligation being restricted to a commitment to use its best efforts to cause the respective amounts of hides and wool to be produced and sold to Defense Supplies Corporation and the British Government. The agreement would not contain a provision for export control prohibiting the export of hides and wool to countries other than the United States and Great Britain, but by reason of the size of the commitment to those two countries, the agreement would have the effect of causing the entire production of hides and wool to be made available to the United States and Great Britain. You are requested to explore the possibility of such a solution with the Uruguayan authorities and to telegraph the Department.

Chargeable to Defense Supplies Corporation in accordance with Section Vā€“45, Foreign Service Regulations.