Foreign Relations of the United States: Diplomatic Papers, 1943, The British Commonwealth, Eastern Europe, the Far East, Volume III

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The British Embassy to the Department of State ⁸⁷

Aide-Mémoire

His Majesty’s Government in the United Kingdom have been examining the question of their commercial relations with Latin America. The prime concern of His Majesty’s Government in Latin America is with the successful prosecution of the war. Concentration upon the war effort has had as in the case of the United States of America the effect of disrupting traditional trade relations. In particular, exports of United Kingdom goods to Latin America have been most severely curtailed; in the case of some commodities they have practically ceased. But if, after the sacrifices of the war, British economic life is to be restored, British long-term commercial interests in Latin America will have to be maintained and developed. His Majesty’s Government feel it is of the highest importance that this development should take place with the understanding and sympathy of the United States Government. His Majesty’s Government therefore wish the United States Government to be fully informed of what steps they are taking and for what reasons.

If the balance of British payments, on which the British standard of life must depend, is to be restored to equilibrium after the war, it will be essential not merely to re-establish British export trade but to increase it materially above the pre-war level. Some doubts about the re-establishment of the United Kingdom trade position after the war are arising in the minds of British communities in Latin America, of United Kingdom traders generally, and of the Latin Americans themselves. They are impressed by the drying up of British commercial activity. The personnel and members of British diplomatic missions who deal with commercial matters have been diverted from their normal duties to others connected with economic warfare. British nationals formerly employed in South America in trade have been called up for service with the armed forces. All this contributes to create uncertainty whether British policy will not lead to the permanent loss by Great Britain after the war of markets in Latin America.

There has at the same time been an increase in the activities of many United States agencies, both governmental and private, engaged in the promotion of United States exchanges with Latin America. This has given rise to an impression, however false, that there may be some desire on the American side to supplant British traders in their established and traditional markets, not only for the war period but permanently thereafter. Any such impression must clearly involve a risk of friction which His Majesty’s Government are most anxious to avoid, and which would run counter to their aim of general collaboration between the United States and themselves in all fields.

His Majesty’s Government are well aware that any such impression is unfounded, and that it is not the policy of the United States Government to eliminate British traders from their legitimate markets. They know that the United States Government regard the general extension of post-war trade as the common objective. They believe that the United States Government share with them the view that Great Britain should participate in this expansion in markets generally, including those in Latin America. The meeting of Ministers of Foreign Affairs at Rio in January, 1942⁸⁸ recommended the development of the natural resources of the American Republics, and indeed these have reached in their economic development a stage where a very considerable expansion appears not only desirable but inevitable. His Majesty’s Government have abundant proof that these Republics are as anxious to expand their trade with Great Britain as His Majesty’s Government are to expand their trade with them.

While His Majesty’s Government will continue to regard the successful prosecution of the war as their prime concern in Latin America or elsewhere, they have accordingly decided to make it clear to the countries of Latin America and to the British communities in them that they retain their commercial interest in these countries. With this end in view His Majesty’s Government intend to increase their overseas commercial organisation in preparation for resumption after the war of the work for which it was primarily intended, and for the demands which will be made upon it by those who wish to trade with Great Britain in the post-war period. At the same time they will assist British business firms to conduct advertising designed to keep alive their interest in Latin American markets and the interest of Latin America in British trade connexions. This advertising will, as in the case of advertising by United States firms, support friendly newspapers and serve to support the cause of the United Nations. His Majesty’s Government are most anxious in these activities to cooperate closely with the United States authorities.

In the light of the above His Majesty’s Government take the opportunity to enquire whether the United States Government would be favourably disposed to the suggestion that instructions analogous to those given recently in respect of Canada,⁸⁹ should be given to American missions, agencies and individuals in Latin America. These might lay down the principle that in all economic matters the underlying policy of both governments is to endeavour to ensure that no advantage in the overseas market shall be accounted to either country at the expense of the other, by reason of sacrifices made in the interest and the effective prosecution of the war, and that no advantage is taken by the nationals of either country at the expense of the other.⁹⁰

Washington , July 9, 1943.

87. Handed to the Secretary of State by the British Ambassador on July 10, 1943.
88. For correspondence on the Third Meeting of the Foreign Ministers of the American Republics held at Rio de Janeiro, January 15–28, 1942, see Foreign Relations, 1942, vol. v, pp. 6 ff.
89. For information regarding Canadian cooperation concerning programming of exports to Latin America, see circular airgram, April 29, printed in vol. v, section entitled “Arrangements regarding the control of exports from the United States”.
90. Although the Secretary of State in a conversation with the British Ambassador on July 10 promised to give the subject “the most careful attention”, no further documents concerning this matter have been found in Department files; memorandum of conversation of July 10 not printed.