811.20 Defense (M) Colombia/74: Telegram

The Ambassador in Colombia (Lane) to the Secretary of State

698. My 691, May 22, 11 p.m.61 The following is a brief summary of statements made to me today by Minister of National Economy:

The Colombian Government is prepared to enter into an agreement with the United States Government giving us the right to purchase all rubber in excess of Colombian internal needs at a price to be based [Page 179] upon price already fixed with the Government of Brazil, for a period of 2 years, subsequent price to be fixed year by year.

Because of the dependence of Colombian economy on automobile transportation and consequent necessity of maintaining adequate supply of tires and tubes, the Colombian Government considers it essential that automobile tire plant be constructed here to take care of current needs. The Minister said that he had under consideration offers from United States Rubber, Firestone, Goodrich, and Goodyear. Colombian Government would assure us that no tires would be exported from Colombia without prior consent on our part.
In any event Colombian Government would undertake not to export rubber or rubber products to any country other than the United States and he reaffirmed the policy expressed to me by the President that as this war is also Colombia’s war the Colombian Government does not under any condition desire strategic materials to reach the enemies of the United States.
Assuming that Colombian requirement for tires and other domestic needs would be 1000 tons of rubber per annum there would still be available at least 3000 tons of crude rubber for export to the United States. (Our estimates for tires and tubes alone for Colombian consumption are 600 tons of rubber per annum).

In order to assist me to proceed in a general way with negotiations, I should welcome the Department’s instructions on the following points:

Would the Department still object (as indicated in Department’s 521, May 6, 8 p.m.) to the establishment of an American plant in Colombia for the manufacture of this [tires?] and tubes?
If not, would it be possible to obtain priorities for machinery for this purpose?
As local press indicates that a higher price has been agreed upon between Brazilian and United States Governments for purchase of Brazilian rubber, would that automatically increase our offer for Colombian wild rubber?

… I suggest that the Department telegraph me its views at the earliest date possible.

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