Foreign Relations of the United States: Diplomatic Papers, 1942, The American Republics, Volume V

740.00112A European War 1939/7480

Memorandum of Conversation, by the Second Secretary of Embassy in Argentina (Gantenbein)³¹

[Buenos Aires,] February 9, 1942.

I called by appointment today upon Dr. Raúl Prebisch, General Manager of the Central Bank, and after preliminary remarks stated that I was calling at the request of the Ambassador in order to have an informal and off-the-record conversation with him regarding Resolution V adopted at the Conference of Rio de Janeiro.³² I stated that, as he knew, the United States Government attached great importance to this financial and economic resolution and that it was naturally very interested regarding the steps that would be taken by Argentina.

. . . . . . . . . . . . . .

I then referred to Argentina’s reservation to the resolution³³ and said that it was not altogether clear to me how the second sentence of the reservation should be interpreted. More specifically, I asked whether the sentence meant that Argentina would apply future measures only “to firms or enterprises managed or controlled by Axis or foreign belligerent countries not in the American continent.” Dr. Prebisch said that this was not at all the case, that he had drafted the reservation himself and that its purpose was to have the Argentine Government “for political reasons” on record as contemplating the possibility of applying the economic and financial measures not only to the Axis countries but also to other non-American belligerent countries. When I inquired whether it was therefore to be inferred that Argentina had undertaken to assume all the obligations under Resolution V, the reservation pertaining only to additional applications, Dr. Prebisch replied in the affirmative.

Turning to another matter, I said that it had been gratifying that largely through the good offices of Dr. Prebisch and conversations that the Embassy had had the Banco de la Provincia and the Banco de Avellaneda had adopted measures providing for greater cooperation with the democracies. I said that this cooperation, however, as well as the cooperation on the part of a substantial number of banks in Buenos Aires, was being neutralized by the fact that certain other institutions, including the Banco de la Nación, were continuing to have relations with black-listed firms and individuals and were, in fact, accepting business which the other banks turned down, besides engaging in other transactions inconsistent with policies pursued by the United States. I stated that the Ambassador was frankly disturbed about this and that before reporting to the authorities in Washington the part being played by the Banco de la Nación, the Embassy thought that possibly some understanding could be reached with that institution along the lines of the understandings reached with the Banco de la Provincia and the Banco de Avellaneda. Dr. Prebisch quickly volunteered to have a conversation in the matter with Dr. Jorge A. Santamarina, the president of the Bank.

After referring to previous conversations in regard to negotiations for a new French payments agreement, I asked Dr. Prebisch whether the negotiations were still in the state of suspense. Dr. Prebisch answered in the affirmative and later said that there was no intention to resume the negotiations. I said that that was welcome news inasmuch as there was some fear that Axis activities here might be financed through French francs.

Finally, I referred to the widespread practice here of making payments to and from the Axis countries through Switzerland and said that although we had heard encouraging reports shortly after the adoption of the measure on December 22, which purported to render it more difficult to make payments in this way, more recent reports had been of a less encouraging character. Dr. Prebisch said that Mr. Walter Simon^33a of the British Embassy had made the same comment and he (Dr. Prebisch) said that he had promised to look into this matter to see what further action might be taken.

31. Copy transmitted to the Department by the Ambassador in Argentina in his despatch No. 4116, February 10; received February 16.
32. For correspondence concerning the Third Meeting of the Foreign Ministers of the American Republics, see pp. 6 ff. For the Resolutions contained in the Final Act of the Meeting, see Department of State Bulletin, February 7, 1942, pp. 117–141; Resolution V recommended that the American Republics cut off commercial and financial intercourse with nations signatory to the Tripartite Pact. The Tripartite Pact between Germany, Italy, and Japan was signed at Berlin September 27, 1940, League of Nations Treaty Series, vol. cciv, p. 386.
33. For text of reservation to Resolution V, see Department of State Bulletin, February 7, 1942, p. 140.
34. Financial Adviser and First Secretary of the British Embassy in Argentina.