831.6363/1682

The Ambassador in Venezuela (Corrigan) to the Secretary of State

No. 6045

Sir: I had a friendly but thorough and frank discussion today with President Medina and his Minister of Fomento, Dr. Gustavo Herrera. This conference was arranged by the President himself following a previous discussion between us on Monday last which had been inconclusive.

The President opened the conference by saying, “We are ready to listen”. I then expressed the sympathy which we held for the desires and ambitions which the Venezuelan Government had advanced in its memorandum of May 13,61 but did not consider that they were under discussion. I said that we considered the liberal trade principles set forth in the Atlantic Charter to be of fundamental importance and could not but look upon the wording of the decree in question as being inconsonant with sound international trade policy.

The President and Dr. Herrera entered into lengthy explanations of the reasons and desires regarding refinery developments, etc., but I insisted that all this had nothing to do with the basic principles involved. Their response was that no principle was involved in these Resolutions under discussion since it was a provision placed in a certain limited number of contracts related to a definite block of concessions. [Page 1672] In other words, it had to do with a concrete fact and did not represent a fixed policy on the part of the Venezuelan Government. They then showed me the limited list of concessions covered by the provision. The President said that their refining industry was developing so satisfactorily that they might even have to consider placing limits on the amount of Venezuelan crude that should be refined within the limits of the country. He stated that details of long-distance policy of the government with regard to its petroleum industry were not fixed and would depend on circumstances that might arise. At no time would the Venezuelan Government consider adopting a policy or principles that would be in disagreement with the American Government on the principles of the Atlantic Charter to which it loyally adheres.

I listened to this exposition and expressed gratification at their explanation that the provisions were related solely to a “concrete case” and did not represent the adoption of a policy. I then said that the wording of the decree was unfortunate in that it might set a bad precedent and give a bad example, and that we could not but feel that it represented a restriction even though, on the basis of their explanation, in minimal amount, and asked if there was any possibility of its being withdrawn. They answered that the decree could not be withdrawn or changed since it had already been incorporated into contracts. The President brought up the fact that the interests of the oil companies were being seriously affected by the delay incident to our representations, that the British and Dutch Governments had already admitted that the Venezuelan Government was right (“Ha dado razón a Venezuela”) in their acknowledgments of the Government’s answer to their requests for clarification which we had not yet acknowledged (Venezuelan Memorandum of May 13). I said that while there was a difference of opinion between us as to the interpretation of the terms of the provision, there seemed no reason why this difference should interfere with the practical relations of the Venezuelan Government with the oil companies. Such a difference of opinion between Governments as to interpretation could be left to be ironed out by experts in future conferences that would undoubtedly take place, and that with the frank and friendly discussion of our points of view I saw no reason why I could not acknowledge their answer (Memorandum of May 13) in such a way as to terminate the present exchange if by so doing the obstacle which was causing delay to important negotiations could be eliminated. The President said they would like to go ahead if I would send an answer like the ones already received from the British and Dutch. I told him that I would do so and sent a note as reported in telegram No. 619, June 14, 5 p.m.62

[Page 1673]

It was my feeling that a partial victory had been won and that much greater care will be taken in future wording of decrees so as to avoid a situation like the present. Insistence on my part on a changing of the wording of this present provision, which is limited in scope, would be to insist on an action which the Venezuelan Government would, I am sure, feel to be humiliating and which they would not do. I, therefore, following this conference sent to the Foreign Office the note, No. 1756, of June 14, 1944, in the terms which were reported briefly in my telegram of June 14.63 In the circumstances I hope that this action meets with the Department’s approval.

Respectfully yours,

Frank P. Corrigan
  1. Not printed.
  2. Not printed.
  3. No. 619, 5 p.m., not printed.