811.20 Defense (M) Bolivia/9–1644: Telegram

The Chargé in Bolivia ( McLaughlin ) to the Secretary of State

1674. From McConaughy. In McLaughlin’s absence from the city Foreign Minister68 summoned me to Foreign Office last evening to discuss the tin price negotiations. He read me the substance of a telegram he had just sent Dorado69 which may be summarized as follows:

It must be conceded that the working and living conditions of the mining laborers to date are no better under the Villarroel government than they were under the Peñaranda Government.
The present Bolivian Government has a specific obligation to the Bolivian mine laborers to better their circumstances and cannot justify its continuance in office without discharging this obligation.
The United States as an Ally of Bolivia in the war against the Axis is bound to render economic assistance to Bolivia to maintain the political and financial stability of the country. This obligation is made greater by the sacrifices Bolivia has made in supplying rubber, cinchona bark and quinine sulphate to the United States for the use of the United Nations at prices lower than could have been obtained from Argentina and elsewhere; and by the price reductions and cessation of purchases by the United States of minerals such as tungsten, antimony, copper and lead which have greatly reduced the revenues accruing to the Bolivian Government.
The Bolivian Government recognizes the right of Bolivian mine owners to a reasonable return on their investment and is prepared to accord them a portion of the anticipated tin price increase if they cannot make a profit on the basis of a 60 cent tin price.
Any price increase granted to the mine owners would be deducted from the fund intended to be set aside for social benefits and would not call for an increase in the price proposed by the Bolivian Government namely 66 cents.
The Foreign Minister is prepared to go to the United States in the near future on a temporary special mission to negotiate a new tin price contract if such action appears desirable.
He would not be accompanied by any other Cabinet Minister and would take with him only advisers at the technical level.

Embassy comment. Andrade’s decision to put out this feeler was probably prompted by reports that Dorado’s proposal to increase the tin price was coolly received by FEA representatives at the first meeting. While Andrade did not specifically ask me to ascertain the Department’s attitude toward his prospective trip to the United [Page 488] States I inferred that he wished to sound out Department in this regard unofficially and indirectly. No doubt he would welcome some expression from Department as to the expediency of his proceeding to the United States at this time. Accordingly an indication of Department’s reaction to this suggestion would be helpful to the Embassy in its further conversations with Andrade.

While I of course did not agree to venture any opinion as to the propriety of the projected mission I took the occasion to point out to the Foreign Minister that if such a trip should materialize he would be in a better position to show the effectiveness of Bolivia’s participation in the war efforts of the United Nations if the National Convention should first approve the decrees providing for the expropriation of Axis firms, and if the numerous knotty problems attendant upon our rubber procurement program which are aggravated by the uncooperative attitude of the Minister of Commerce could be resolved forthwith.

A further account of this conversation will be given in following telegrams. [McConaughy.]

  1. The replacement of Enrique Baldivieso by Victor Andrade as Foreign Minister was announced on August 8, 1944. On October 30, 1944, Gustavo Chacón took over the direction of the Foreign Office, when Andrade was named as Bolivian Ambassador to the United States.
  2. Carlos Dorado, Counselor of the Bolivian Embassy.