The Ambassador in Peru ( Norweb ) to the Secretary of State

No. 3563

Sir: I have the honor to inform the Department that the delegation of cotton technicians composed of Messrs. Norris, Moffat and Cook arrived in Lima on April 29. They were met at the airport by numerous representatives of the Cotton Chamber, the Agrarian Society and the Finance Ministry. After exchanging visits with members of the foregoing organizations as well as with a special committee designated by the acting Finance Minister to assist them in their work, they paid an official call upon the Finance Minister a.i. Moreyra on the afternoon of April 30.

Some uncertainty has been expressed in cotton trade circles during the last few days with reference to the time or period in which the [Page 692] purchase of cotton will actually take place. Those at interest have called attention to the fact that the lack of income through sales of cotton futures is adversely affecting certain growers to some extent. All of this talk, of course, had as its principal purpose the encouragement of actual purchases at the earliest possible moment. After consulting with various authorities on the subject, I am inclined to attribute no special importance to those views. The absence of sales of futures this year differs little from the conditions which prevailed during the preceding two years. Moreover, the Agrarian Bank is offering to the cotton growers such financial assistance as they may need.

In any event, the arrival of the delegation and the information which they have already conveyed to the principal personalities have been sufficient to produce satisfaction.

The understanding which has been reached by the United States and Peruvian governments constitutes one of the most far-reaching economic and political developments which has taken place in Peru in recent years. As is well known, the cotton interests represent probably the strongest political influences in the nation, and the fact that cotton production and marketing problems have been settled for this and succeeding years has already created an attitude of confidence and cooperation whose consequences will be of immense value in maintaining the stability of the incumbent administration, and in more rapidly and effectively achieving a number of our anti-Axis objectives in Peru. The Department will be interested in learning that President Prado, himself, yesterday made very favorable comments upon the rapidity with which the cotton problem had been solved. The arrival of the delegation within one week of the signing of the understanding impressed upon him the determination of the American government to discharge its part of the cooperative program with precision.

The members of the delegation are fully aware of the importance of their assignment and from the moment of their arrival directed their activities in the direction of the Government’s general policy in Peru. During their conversation with the Finance Minister a.i. on April 30, they placed special emphasis on the spirit of cooperation and made it clear that the Japanese and other Axis elements interested in cotton either directly or indirectly may not derive benefit. The Minister as well as the representatives of the Cotton Chamber and the Agrarian Society expressed complete approval of this part of the understanding and assured the delegates that they had been familiar with this phase of the question for some time and are disposed to cooperate.

Respectfully yours,

R. Henry Norweb