The Acting Secretary of State to the Diplomatic Representatives in the American Republics Except Argentina

Sirs: Many of the American republics are in arrears in the payments they obligated themselves to make to this Government, under the terms of bilateral Lend-Lease agreements, for Lend-Lease materials received. The Department has decided that the time is opportune for this Government to press the governments that are in arrears to make the payments so far in default, and to do so in substantially the same terms with respect to all the governments concerned. In carrying out this decision, the Department will deal directly with the embassies in Washington of the governments concerned, and the American embassies in other American capitals will not, consequently, be called on to make representations.

An element in the background of this decision is this Government’s policy to promote the standardization of arms and munitions of war among the American republics on United States standards, and therefore to discourage other American republics from equipping their armed forces by procurement outside the Hemisphere. Should any American government in arrears on its Lend-Lease payments undertake to make cash purchases of arms or munitions of war from non-American sources, this Government might wish to take the position that the Lend-Lease materials should be paid for first. With this in [Page 245] mind, the embassies accredited to the governments that are in arrears should be especially alert for any indications that such purchases outside the Hemisphere are being contemplated, and should keep the Department informed accordingly.

El Salvador and Honduras are slightly behind in their payments while the following countries have paid nothing on their Lend-Lease account: Bolivia, Costa Rica, Cuba, Ecuador, Mexico, Nicaragua, Paraguay and Perú.

Very truly yours,

Joseph C. Grew