103.9169 Asunción: Airgram
The Chargé in Paraguay ( Reed ) to the Secretary of State
[Received July 29—2 p.m.]
A–265. For F.E.A. Reference Department’s telegram No. 195 of June 22, 4 p.m.,17 regarding decentralization rollback. The Paraguayan Country Agency has not yet made public announcement of the rollback but is rejecting local applications for import recommendations on all commodities not included in positive list with notice to applicant that import recommendation is no longer required. In view of limited number of firms in this country importing from the United States the Embassy anticipates that news will quickly reach all concerned. Most of the principal importers are already aware of situation through notice from Country Agency mentioned above, through information obtained on request from the Embassy, or through receipt of Export Bulletin 171.18
The Paraguayan authorities have been reluctant to see the decentralized export control diminish since through it they have been able to throw the responsibility for arbitrary distribution on us. There are in existence several decrees affording the Paraguayan Government [Page 1461] adequate legal basis for controlling itself the entry and distribution of imports but it hesitates to accept the political responsibility of denying permits to strong but undesirable firms. The Minister of Industry and Commerce even intimated that the Paraguayan Government would like to submit a list of firms it considers politically undesirable to F. E. A. for rejection of export license applications in Washington. He has been convinced that this would be impractical from an operational standpoint.
Our attitude in regard to relinquishing controls over commercial transactions looking toward a return to normal operations as soon as circumstances permit has been fully explained to the Country Agency and the Minister of Industry and Commerce and while their thinking is in the opposite direction, they will proceed with the decentralization rollback as promised. However, they did specifically request that F. E. A. forward airmail a list of licenses granted for exports to Paraguay each week for checking purposes here. In agreeing to transmit the request the Embassy pointed out the likelihood of this being impractical. F. E. A.’s answer would be appreciated.