811.20 Defense (M) Bolivia/878: Telegram
The Secretary of State to the Ambassador in Bolivia (Boal)
443. Embassy’s A–198, March 12,76 487, March 13, 500 and 502, March 16, 545, March 22.77 The views and recommendation contained in your 502, March 16, are concurred in by the Department.
At the Department’s request the Bolivian Ambassador came in March 25 to discuss the matter. He was advised that we were very much concerned that any question was being raised at this late date as to the validity of the agreement, particularly after the agreement had been so extensively considered by the Bolivian Congress last year. We also said that the sale of any amount in excess of the 250 tons reserved for sale to neighboring countries would, of course, violate the agreement. We stated that a very unfavorable reaction on public opinion and on the attitude of the United States Government as a whole would result from either of these issues being raised.
It was pointed out that neither Chile nor Uruguay appeared to need rubber. In both cases we have undertaken in collaboration with Brazil, to furnish and are furnishing their essential requirements for rubber and rubber products, and it is understood that in both countries there are substantial stocks of rubber. Uruguay has offered us surplus stocks of tires, and its proposal is now under consideration. We have just concluded a purchase of 90 tons of rubber from Chile. (The Embassies at Santiago and Montevideo have been advised of the Bolivian situation and requested to discuss the matter with the local authorities, pointing out these factors and to the violation of the Bolivian rubber agreement involved in the proposed transactions.)
The Ambassador was advised that we were unwilling to discuss the inclusion or exclusion of Caupolicán or Larecaja while there is any question as to the validity of the agreement as a whole; that we have engaged in development work, provided equipment and material and expended substantial sums of money under an agreement which we understood to be valid in all respects; and that to question the agreement or its implementation would inevitably affect other programs being carried on jointly between the two Governments. The Ambassador was told that we had no doubt a conclusion, satisfactory to both Governments, as to the question raised in your 487 and related questions, could be reached promptly once any question with respect to the agreement as a whole has been removed.
The Ambassador stated he would telegraph his Government with respect to this matter. You are requested to take the same position [Page 561] with the Bolivian Government. Rubber Development concurs in the foregoing and you are requested to communicate the substance to Lepper and Hall for their guidance.