710.Consultation (3)/435

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

No. 3823

Sir: I have the honor to submit the following observations with regard to the general attitude and position which the Argentine Delegation may be expected to take at the Rio de Janeiro Conference. These observations are based upon conversations with various Argentines, in and out of the Government, as well as officers of the Army and Navy and certain of my diplomatic colleagues.

Political

Unless some important event should occur in the meantime to change the international situation, it appears virtually certain that the Argentine Government will not agree at Rio de Janeiro to consider declaring war on the Axis Powers. The suggestion to that effect already communicated to the Government here by the Dominican Republic has not been favorably considered and while so far as can be learned no official reply has been given, from talks with the Foreign Minister and other officials it seems clear that the Government is not disposed to go to such lengths. This was made clear to the Brazilian Ambassador, Dr. Rodrigues Alves, in a talk he had with the Foreign Minister just before the former left for Rio de Janeiro to take over his duties as Secretary General of the Conference (see Embassy’s telegram No. 1573, of December 28 [27], 7 [8] p.m.).38 The same decision would probably apply so far as the breaking off of diplomatic relations with the Axis Powers although being a less drastic step, this is not so certain. The fact that the recall of the German Ambassador39 by his Government has been definitely announced as well as the withdrawal of the Argentine Ambassador in Berlin,40 and the efforts which will be made by influential Argentines [Page 17] to prevent successors to the above being appointed might possibly result in a situation somewhat similar to that in our own relations with Germany prior to the state of war, with Chargés d’ Affaires in charge of both missions, but for the present at least, it seems doubtful whether the Government here would permit matters to proceed beyond this point. In considering both the question of declaration of war and severance of diplomatic relations, it is necessary to remember that so far as Argentina is concerned, a distinction must be drawn between the three principal Axis Powers. A declaration of war against Japan would be far easier to envisage than against Germany, and particularly Italy. As the Under Secretary for Foreign Affairs, Dr. Gache, remarked cynically in a burst of frankness, when I expressed some concern that Dr. Ruiz Guiñazú seemed more hesitant in agreeing to the decree declaring the United States would not be regarded as a belligerent following the declaration of war by Germany and Italy than he had been in the case of Japan: “You must remember that there are virtually no Japanese in the country; but there are many Germans and more Italians: that, to a politician, is important.”

The clearest and most objective presentation of Argentina’s position that I have yet had came from Rear Admiral Gonzalo D. Bustamante, at present in command of the River Squadron, in a recent talk when we discussed the coming conference at Rio de Janeiro. His thesis was roughly as follows:

First and most important of all, it must be remembered that the vital interests of our country call for the closest cooperation with the United States. That is the point from which any discussion of our foreign policy must begin. Aside from commitments formally taken, ideologically, geographically, economically and from the naval and military standpoint, we are bound to the United States. No other position is conceivable. Admitting this, as all serious Argentines must, let us consider our position at Rio de Janeiro. I do not believe that it is to your or to our interest that Argentina should declare war against the Axis Powers. We are not, certainly, at this time, in a position to defend ourselves if attacked. Should Brazil and Argentina declare war, the Axis Powers might well attempt to make an example of us. In such a case, could we count on assistance from the United States and Great Britain? If you attempted to help us, as we feel sure you would, it would mean further extension of your lines. Also do not forget that one fifth of our population is of “Totalitarian” origin, principally Italian. While many of the Italians are at present not Fascists, declared war against the country of their origin or of their parents would present them with a clear cut issue. Sabotage in many industries and fields of production [Page 18] essential to the United States might well take place. Argentina’s best role for the present, I feel, is to patrol its coastal waters, to prevent enemy activities from gaining foothold on our coasts or operation within our waters; clean house within the country by putting an end to fifth column and subversive activities and cooperate fully with you in making available all supplies you need, repairing your ships if damaged on convoy or in enemy engagements, etc.

“What about breaking off diplomatic relations,” I asked. “This would eliminate the heads of subversive movements and stop communications now made possible through diplomatic immunity?”

“We must weigh the advantages against the disadvantages,” he replied. “I still feel that the advantages to be gained by such a step would not compensate for the disadvantages I have mentioned.”

I asked him about convoy: whether it was not logical that, with our country making every effort to keep Argentina supplied with necessities, even at a sacrifice to our own people, they should at least assume part of the burden of convoy, should this step be found necessary. He hesitated. “For the moment” he said, “let us use our ships for patrol purposes. Convoy is the first step to war, and again I do not feel we are ready.”

Admiral Bustamante, who has spent much time in the United States and is married to an American, represents the element in the navy more favorably disposed to the United States. Our Naval Attaché41 informs me that he is generally considered to have the best mind among the higher naval officers. With Admirals Guisasola, Stewart, Zar, and certain others, Bustamante can, I feel, be considered to favor cooperation with us within the limits set forth.

On the other hand, Dr. Gancedo,42 the conservative deputy who recently visited the United States and returned a firm advocate of closest cooperation with us, informs me that he has had frank talks with the Acting President,43 with General Justo,44 and with the Foreign Minister, and that the Government is prepared to convoy its own vessels. Furthermore he thinks that, if pressed, they might agree to participate in convoying United States ships carrying Argentine goods as far as Brazilian territorial waters, where Brazilian ships could then take up the escort. While he avoided the question of declaration of war or official severance of diplomatic relations, he believes that in all other matters we can count on Argentina’s support at Rio de Janeiro. He assures me that in all his talks he has insisted that at the forthcoming conference at Rio Argentina must take the [Page 19] lead in declaring full solidarity with the United States. He it was who told me he hopes with Justo’s support to prevent the appointment of a successor to Olivera, recently recalled from Berlin, and who is slated for another post. He is also working to the end that a successor to von Thermann shall not be accepted by the Argentine Government. Dr. Gancedo also informed me that Candioti45 is not to proceed to Tokio—in other words that the post of Ambassador in Japan will be left unfilled. He … is planning to be in Buenos Aires during the conference and assures me that should the Argentine delegation at Rio not be disposed to cooperate he will be glad to use his influence with the Acting President, which is considerable, and with the Acting Minister for Foreign Affairs, Dr. Rothe, his closest friend in the cabinet.

So far as concerns Argentina’s part in continental defense measures, it is presumed that the plan taken to Washington by the Argentine Military-Naval Mission46 is now known to the Department. While I am not myself familiar with the plan, the Minister for Foreign Affairs intimated that it is very comprehensive and envisages cooperation particularly as regards naval defense, with the east coast republics, particularly Brazil and Uruguay, as well as with Chile in defense of the Straits. (The Argentine plan was drawn up presumably prior to the initiating by Chile of negotiations to amend the treaty of 188147 to provide fortification of the Straits for the duration of the war.) The fact that our delegation does not include Naval or Military experts presumably indicates that we do not envisage at Rio discussions regarding the technical aspects of defense against external aggression.

So far as concerns measures to curb alien activities within the country, this is certainly a point on which a clear understanding with Argentina will have to be reached. Under declarations VI and VII of Habana,48 Argentina is committed to take the necessary steps to prevent such activities. This, as the Department is aware, the Argentine Chamber of Deputies, through its Investigating Committee, has attempted to do, and so far as the work of the Committee itself was concerned, it performed a very satisfactory and thorough job.

From the outset, however, it received no assistance or cooperation from the Government. On the contrary, the Committee found itself continually blocked and hampered in its efforts, particularly by the Minister for Foreign Affairs. Without discussing the reasons for this, which lie largely in the personality of the Foreign Minister and [Page 20] the narrow and provincial attitude of the Acting President in viewing the activities of the Chamber Committee merely as Radical attempts to embarrass the Government and encroaching upon the jurisdiction of the Executive, it seems probable that, unless a clear understanding is reached in Rio de Janeiro, the Government here will adopt the same attitude and obstructionist tactics in the future. As the Embassy has reported, the “State of Siege” widely heralded as designed to implement Argentina’s commitments taken at Habana, particularly as regards not considering the United States as a belligerent, has thus far had little effect other than to prevent the 95 percent pro-democratic press and public from presenting or making known their viewpoint without, so far as can be seen, seriously hampering the subversive activities and insidious propaganda of the Axis Powers. It would seem clearly indicated that the declarations of Habana dealing with subversive activities49 should be re-discussed and interpreted so clearly and unequivocally as to leave no possible room for doubt as to what are the duties assumed by each of the Republics in this respect. (The negligent attitude of the Argentine Government in permitting the escape from the country of many officers and men of the Graf Spee50—a negligence which could only be interpreted as deliberate after repeated warnings given them by the British Embassy—falls within a different category, since regardless of commitments taken at Habana, the Argentine Government’s responsibilities under Neutrality required the internment or close supervision of these men.)

It would seem that if we could go further and have a clear distinction drawn between subversive alien activities and anti-democratic propaganda by the Axis Powers on the one hand and the exposition by the democratic belligerents (“democratic belligerents” to include the non-American allies of American belligerents) of their aims in the war, this might be a means of preventing the continuance of the present state of affairs in Argentina by which all the press is muzzled.

Economic

So far as concerns the questions to be considered under this heading of the agenda proposed for Rio de Janeiro,51 there would seem to be no reason to envisage particular difficulties raised by the Argentine delegation except possibly on point 5. The Embassy, under date of December 18 last, presented to the Argentine Government a note based upon the Department’s circular telegram of December [Page 21] 1552 last with regard to the measures to be adopted to curb the economic and financial activities of the Axis countries (as reported in the Embassy’s despatch no. 3735 of December 22, 194153). No reply has yet been received, although an early reply had been promised. On December 26, I handed an aide-mémoire53 to the Under Secretary for Foreign Affairs summarizing measures of this character taken by certain other South American countries, the information having been compiled from the data contained in the Department’s telegram No. 1148 of December 24.53 Copies of the note and of the aide-mémoire were also given to Raúl Prebisch, General Manager of the Central Bank.

The only action which the Argentine Government or the Central Bank has thus far taken to curb financial transactions for the benefit of the Axis countries has consisted of two circulars issued by the Central Bank and dated December 11 and 22 (Nos. 262 and 264), respectively. The first of these, which was issued at the direction of the Ministry of Finance, provides for an embargo on transfers of funds to and from Japan and “freezes” accounts of funds and securities in Argentina of persons or firms domiciled in Japan (as well as prohibits deposits in such accounts), although operations may be conducted if expressly authorized by the Central Bank. The circular of December 22 purports to render more difficult the extensive practice of making transfers to certain countries of Europe and the Far East through Switzerland and other third countries.

A factor in this entire situation, of course, is that before the United States entered the war, the Central Bank had already been given a substantial control over transfers of payment to Europe and the Far East. The measures providing such control, as well as the circulars of December 11 and 22, were reported in the Embassy’s despatches nos. 3744 of December 24, 1941 and 3752 of December 26, 1941.54

How much further the Argentine authorities will be disposed to go in curbing economic and financial activities of the Axis countries is difficult to say. An impression prevails that the Central Bank and perhaps certain persons within the Government would be willing to go at least some distance further in meeting our desiderata but that Dr. Ruiz Guiñazú is the retarding influence. It is to be recognized, however, that the large number of Italian and German nationals in Argentina present real difficulties in the formulation of [Page 22] any measures that would pertain to internal transactions of those nationals and their business enterprises.

As to external transactions, the Embassy has continuously emphasized in conversations on the subject with the Argentine authorities that even though the Central Bank already has considerable control over such transactions, a clear-cut measure at this time that would apply specifically to Germany and Italy (as the measure of December 11 refers specifically to Japan) would have a good psychological effect, and has implied that the absence of such a measure is having a correspondingly bad effect.

The Embassy has also emphasized in these conversations that the prompt adoption of a measure of this kind could be calculated to produce a better impression abroad than would be the case if no such steps were taken before the taking of collective action at the conference at Rio de Janeiro.

As of possible interest to the Department, I am enclosing a memorandum55 based on information given by the Paraguayan Minister to Argentina, Colonel Garay.

Respectfully yours,

Norman Armour
  1. Not printed.
  2. Baron Edmund von Thermann.
  3. Ricardo Olivera.
  4. Capt. William D. Brereton, Jr.
  5. Deputy from the Province of Santiago del Estero in the Argentine Chamber of Deputies.
  6. Ramón S. Castillo.
  7. Gen. Agustin P. Justo, former President and Minister of War.
  8. Alberto Candioti, Argentine Ambassador to Colombia.
  9. See correspondence between the United States and Argentina concerning defense, pp. 371 ff.
  10. For English version of treaty, see British and Foreign State Papers, vol. lxxii, p. 1103.
  11. Department of State Bulletin, August 24, 1940, p. 132.
  12. Resolutions VI and VII.
  13. For correspondence concerning the violation of the Security Zone by this vessel, see Foreign Relations, 1939, vol. v, pp. 85 ff.
  14. See Department’s circular telegram of December 10, 1941, 6 p.m., printed in Foreign Relations, 1941, vol. vi, section entitled “Third Meeting of the Foreign Ministers of the American Republics, held at Rio de Janeiro, January 15–28, 1942: Preliminaries.”
  15. Not printed; for efforts to control financial transactions involving the Axis, see pp. 453 ff.
  16. Not printed.
  17. Not printed.
  18. Not printed.
  19. Neither printed.
  20. Not printed.