835.796/268

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

No. 5396

Subject: Possible resumption of Lati air service between Argentina and Spain

Sir: With reference to the Department’s instruction No. 2466 of June 2,18 I have the honor to report that recent rumors pertaining to this general subject were mentioned in the Embassy’s strictly confidential despatch No. 5322 of June 4.18

With regard to the Berliner Boersenzeitung report that Argentine pilots would be used between Buenos Aires and Natal, it is questionable whether Brazil would permit Argentine pilots to fly any further north than Rio de Janeiro. It is believed that this latter privilege would also be conditioned on Argentine permission for a Brazilian airline, such as Condor, to resume service to Argentina. As mentioned previously, there has been some talk that Brazilian and Argentine airlines would effect a junction at Posadas, in the northeastern part of Argentina, [Page 444] in order to establish a new service between Buenos Aires and Río de Janeiro, but there do not appear to have been any definite developments in this connection.

Apart from the periodic rumors as to secret arrivals of long-distance Axis planes in South America, the reported movement of former Lati employees from Brazil to Argentina (see confidential despatches nos. 4299 and 4302 of June 1 and 4, from Office of Military Attaché, Río de Janeiro20) lends credence to the possibility that plans for a new South Atlantic air service are being considered.

Constant efforts to obtain more concrete information along this line have been unsuccessful so far, but the Embassy will continue to report information and rumors of a fairly credible nature.

In any event, it is assumed that the U. S. control over gasoline, coupled with the application of general economic measures if necessary, will offer an effective means of blocking any project which appears inimical to our interests.

Respectfully yours,

For the Ambassador:
Edward L. Reed

Counselor of Embassy
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