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

740.00112A European War 1939/8046

Memorandum of Conversation, by the Second Secretary of Embassy in Argentina (Gantenbein)³⁴

[Buenos Aires,] February 20, 1942.

I called by appointment upon Dr. Prebisch again today and began by referring to El Pampero and other agencies of Nazi propaganda in Argentina. I stated that the Ambassador had mentioned this subject informally at the Foreign Office once or twice but felt reluctant to make formal representation because of the long-established policy of the United States with respect to freedom of the press. It had occurred to the Embassy, I said, that perhaps an approach to the problem would be through the Central Bank, especially with reference to the Executive Decree No. 110,790 of January 8, 1942, which subjects to the control of the Central Bank “transfers of funds abroad and internal movements of funds which may have a direct or indirect relation to such transfers by firms or enterprises managed or controlled by persons who have the nationality of a country at war or are domiciled in it.” In this connection, I referred to the recent report of the Congressional committee investigating subversive activities in Argentina, which made it clear that El Pampero and other Nazi papers and news agencies were receiving financial support from the German Embassy and from sources in Germany, and I said that it was well known that a large number of copies of El Pampero were being distributed gratis to members of the Argentine armed forces and to government employees as a part of the Nazi propaganda system.

Dr. Prebisch said that he felt entirely in accord with the Embassy in respect to the unsavory nature of El Pampero as well as its detrimental influence upon relations between the two countries and stated that he had given considerable thought to what might be done in the matter. Over a year ago, he said, he had informed the Embassy of the source of the newsprint supply of El Pampero, and he indicated that our Government had evidently not taken steps to cut off this supply.³⁵ I commented that this aspect of the matter had been under constant study by the Embassy and by the authorities in Washington, but that the newsprint problem was a very involved and difficult one. Dr. Prebisch then said that the application of any financial action against El Pampero would have to be initiated by the Argentine Government, and when asked whether the decree aforecited did not furnish sufficient authorization to go ahead, he said that he was afraid not. Dr. Prebisch stated that his suggestion would be that the Embassy hold the matter in abeyance until after the elections in March and then take it up with the Foreign Office.

… I said that the Ambassador had informally inquired at the Foreign Office concerning Argentine action on the various resolutions of the conference^35a and had been informed that they had been referred to Dr. Ruiz Moreno³⁶ for an opinion as to whether it was necessary to submit them to Congress for approval. I added that the Ambassador did not, however, feel disposed to make representations concerning Resolution V, largely because he felt that it was assumed that Argentina would take the appropriate action in accordance with its commitments under Resolution V.

In reply to the question whether it was likely that Great Britain would be placed in the same category as the Axis countries in any forthcoming decree in connection with Resolution V, Dr. Prebisch stated that probably all non-American belligerents would be placed in the same general classification, as in the decree of January 8, but that as a practical matter the measure would apply only to the Axis countries.

I then referred to the relations of the Banco de la Nación Argentina with the Axis countries, (which I had also discussed with Dr. Prebisch on February 9, 1942) and after reminding Dr. Prebisch that he had said that he would welcome such pertinent information on this and other matters as the Embassy might be able to supply, I said that it had come to the attention of the Embassy that about the middle of last December the Banco de la Nación had executed a payments order by the Reichsbank of Berlin for approximately 190,000 pesos. When I said that this may have been for the German Embassy or for propaganda organizations here, Dr. Prebisch said that under a new regulation, the German, Italian and Japanese Embassies were being limited to 200,000 pesos per month for their peso requirements. He said that it would be very difficult for those Embassies to receive more than that amount through banks here. However, when I suggested that perhaps the Embassies could receive pesos through the accounts of others and through peso notes delivered at the Embassy, Dr. Prebisch admitted that that would be a possibility. He promised, nevertheless, to look into the transaction referred to.

Referring to the conversation which the Embassy had had last December, through Dr. Prebisch’s good offices, with officials of the Banco de la Provincia, I said that the Embassy had received another report indicating that in the first part of January, the Banco de la Provincia had received from the Banco Alemán here two sums aggregating 52,000 pesos for the account of the Banco Alemán, Barcelona, through the Instituto Español de Moneda Extranjera of Madrid. This, I said, would seem to be a “cloaking” transaction inconsistent with the understanding which the Embassy had reached with the Banco de la Provincia. Dr. Prebisch said that he would look into this matter also.

Turning to the broader question of relations of Argentine banks with black-listed firms, I asked Dr. Prebisch whether there was any policy among the banks here in this regard. I said that the Banco de Avellaneda had given assurances that it would refrain from such transactions and that the American banks, as well as the banks cooperating with the British Embassy, were refraining from operations with firms on the American and British lists. Dr. Prebisch replied that, of course, the Argentine Government had taken no official action in the matter but that transactions with black-listed firms were in general being frowned upon by the Argentine banks. He said that it was realized that the maintenance of relations with black-listed firms would render banks, as well as other commercial organizations, subject to being placed on the black-lists themselves. In this connection, I reminded Dr. Prebisch that the pertinent committee in Washington was becoming more drastic and was frequently calling upon the Embassy for explanations when it received reports that organizations here, including banks, were maintaining relations of this character. Dr. Prebisch said that he would look into this subject to see whether a more effective policy might be worked out here.

Finally, I asked Dr. Prebisch whether in the event that the Argentine Government purchased the French ships here for the newly established Merchant Marine, the proceeds would be blocked, to which Dr. Prebisch replied definitely in the affirmative.

The general impression that I obtained from this conversation was that Dr. Prebisch favors a cooperative policy with the United States in economic and financial matters, and really wants to be helpful, but either feels powerless in the matter or is unwilling to use his influence to force the issue with the Government.

34. Copy transmitted to the Department by the Ambassador in Argentina in his despatch No. 4199, February 20; received March 3.
35. For correspondence on the newsprint problem, see pp. 400–428, passim.
36. i.e., the Third Meeting of the Foreign Ministers of the American Republics, held at Rio de Janeiro January 15–28, 1942.
36. Isidro Ruiz Moreno, Legal Adviser to the Ministry for Foreign Affairs.