Memorandum by the Acting Chief of the Division of the American Republics (Bonsal) to the Under Secretary of State (Welles)

Mr. Welles: It is my understanding that we have adopted a definitively negative policy toward Argentina in regard to: (a) the shipment to that country of war material and (b) the conclusion of an over-all purchase agreement covering strategic materials.

The question which now arises in acute form is the policy to be adopted regarding the export to Argentina of scarce materials. These materials are vitally important to the economic activities of the country. No policy of restriction below the extremely low levels made necessary in the case of the American republics as a whole could be effective in the case of Argentina without British cooperation. I do not think that we would wish to ask for such cooperation or that any specific discrimination against Argentina in this matter would be a contribution to the war effort.

I therefore recommend that our allocations, priorities, and export license policies toward Argentina be handled on the same basis as toward the other American republics. It seems to me that to proceed otherwise would be to fail to take a realistic view of Argentina’s importance to us and to the British at this time.

Philip W. Bonsal