832.24/2104a
The Secretary of State to the Chargé in Brazil ( Simmons )
The Secretary of State refers to the problem of supplying Brazil with certain small items which the various Brazilian Government purchasing commissions in Washington have tried to procure through the Office of Lend-Lease Administration but which transactions cannot be handled as Lend-Lease requisitions because of existing regulations.71 These cover two types of materials—supplementary material or equipment for projects when valued less than $300 and spot requirements when valued less than $1,000. In addition, requests to the War Production Board for preference rating on forms PD–1A or PD–3A are occasionally returned to the Office of Lend-Lease Administration with a refusal to authorize the transaction because the material can be procured through normal commercial channels; in such cases the Office of Lend-Lease Administration returns the requisition to the Brazilian mission with that suggestion. However, when application [Page 154] is made to the Board of Economic Warfare for supply assistance and export license, such application becomes subject to the decentralization procedure and the requirement of a Preference Request Recommendation. Even telegraphic clearance in such cases will involve delay which may be needless.
At a meeting held on July 5, 1943 this problem was discussed with representatives of the Board of Economic Warfare, Office of Lend-Lease Administration and the Brazilian Embassy. The following points which were covered and suggestions made are submitted for the information and approval of the Embassy and Carteira of the Bank of Brazil:
If the export licenses are for project materials, they will be included in the requirements program submitted to the Board of Economic Warfare by the Office of Lend-Lease Administration. However, if, as is generally the case, they are for spot or unprogrammed items, no provision will have been made for such items in the requirements program. It was pointed out that such spot items are ordered for urgent needs without sufficient advance notice to permit programming. On the other hand, the export licenses must be charged to some quota or allotment and hence it is desirable to make appropriate provision in setting up requirements. It was suggested that spot items could be charged to the Board of Economic Warfare contingency and thereby the civilian allocation would be unaffected.
The frequency with which particular items such as chemicals were ordered was discussed and assurances were given to the Board of Economic Warfare by the representatives of the Office of Lend-Lease Administration and Brazilian Embassy that such items were not recurrent.
It was the unanimous opinion that the following procedure would be feasible and should be presented to the Carteira in Brazil for consideration: When a particular item could not be handled for procurement by the Office of Lend-Lease Administration, it would so inform the Brazilian Purchasing Commissions. An application for export license accompanied by any necessary War Production Board applications would then be presented through the Office of Lend-Lease Administration. If the item were essential to the Brazilian military program, Lend-Lease would approve the application by a written memorandum or stamped approval and refer the item to the Board of Economic Warfare. The Board of Economic Warfare licensing officers would be instructed to grant such licenses without Preference Request Recommendations. If the item were of a type covered by estimate of supply, the license would be charged to contingency. In some cases, the contingency might not be large enough to cover the particular application; if so, either a supplemental quota or allotment would be obtained from the War Production Board or the Carteira would be requested by airgram or telegram to authorize a charge against the Brazilian civilian quota or allotment.
- For correspondence on the negotiation of a Lend-Lease Agreement between the United States and Brazil and on procurement of strategic goods by the United States, see Foreign Relations, 1941, vol. vi, pp. 528 ff., and pp. 538 ff., and ibid., 1942, vol. v, pp. 815 ff. and pp. 674 ff.↩