811.20 Defense (M)/7842: Telegram

The Minister in Guatemala ( Des Portes ) to the Secretary of State

251. From Holt for Bicknell, Rubber Reserve. Since my telegram of July 15 have had Reserve’s views explained to President personally and have today presented another memorandum through Foreign Office. As outlined in President’s formal approval following points already agreed in principle:

Reserve will establish agency whose records will be open to Government.
Reserve will sign agreement with whatever office designated by Government.
Rubber exported to the United States will pay no Guatemalan duties or taxes.
Reserve may buy directly from any producer authorized by Government to exploit rubber.
Reserve will determine with the Government the tonnage indispensable for domestic consumption and deliver it to designated factories at export prices.
Base price will be 33 cents f.o.b. ports for scrap with premium for higher qualities.
Reserve will work with Government to maintain customary wage levels.
Reserve will guarantee base price until end of 1946 unless revised after 2 years by mutual agreement.

An agreement formalizing these points will give Reserve workable basis for operations and practically everything included in your draft except limitation of domestic consumption to fixed tonnage. Actually domestic consumption will be low and other controls may be used if necessary. Recommend acceptance of points outlined and request immediate telegraphic authority to sign the agreement based on them. Must strike while iron is hot. 24.71. [Holt.]

Des Portes