824.001 Peñaranda, Enrique/68
The Chief of the Division of the American Republics (Bonsa1) to the Ambassador in Bolivia (Boal)
Dear Pierre: In Larry’s74 absence I am pleased to acknowledge your letter to him of March 5, 1943,75 in which you enclosed a copy of a letter dated March 2, 1943, addressed to Mr. D. S. Iglehart, Grace and Company, New York, by Mr. J. E. Zalles, discussing certain matters of political and economic interest to President Peñaranda [Page 559] who has requested Grace and Company to sound out government opinion in Washington on these subjects prior to his trip to the United States.
I agree with your view that it would be inadvisable for you to initiate the discussion of these questions with President Peñaranda, especially in view of the fact that he has chosen Grace and Company as his confidant in the present case. However, as it is possible that President Peñaranda may communicate his views to you at some later date, I shall set forth below for your background information certain considerations relative to the points raised.
- 1)
- Minerals. The question of long term minerals contracts is being studied by the Department and the various interested agencies, but due to its extremely complicated nature it is doubtful whether the views of this Government will be sufficiently clarified by the time President Peñaranda arrives in Washington to enable any definite proposals to be submitted to him. Accordingly, the President should not be encouraged to expect that he can do more than discuss long term minerals contracts in general terms.
- 2)
- Rubber. This Government has every desire to stimulate Bolivian rubber production as a war measure. Interest in a post war rubber program in Bolivia is at present limited to possible encouragement for experimental plantations to test the possibility of establishing a Bolivian source of supply which could furnish crude at a price reasonably competitive with far eastern or synthetic rubber.
- 3)
- Hydroelectric Development. Due to material shortages hydroelectric development in Bolivia would presumably have to await the end of the war. This would seem to be a field for activity on the part of the Development Corporation and any program of this sort should be handled through the Corporation.
- 4)
- Guarantee of Territorial Integrity. The United States cannot accept responsibility for the territorial integrity of Bolivia whose security must depend on the functioning of the inter-American security system.
- 5)
- Additional Tanks and Planes. The Munitions Assignment Board is of course reluctant to divert tanks and planes from the actual fighting fronts. It is possible, however, that, if sufficient reason were shown, Bolivia’s allotment of certain types of training planes might be increased.
In general, it should be stressed that the Department does not contemplate President Peñaranda’s visit as more than a good will trip giving recognition to the considerable achievements in United States-Bolivian relations which have already been accomplished. It would be unfortunate if the President should leave La Paz, expecting to receive substantial material, financial, or political benefits.
With warm personal regards, I am
Sincerely yours,