740.00112A EW/3–1846: Airgram

The Chargé in Uruguay ( Sparks ) to the Secretary of State

confidential

A–85. Ref Dept’s circular airgram March 4, 9:25 a.m. 1946.24 Replacement situation remains substantially unchanged as reported in despatches 6034, July 9 and 6194, August 10, 1945.25 Emplacement bill (desp. 6151, August 1, 194524) is pending in Congress, which reconvenes today after summer recess. Bill has been formally approved by majority of House committee (7 in favor, 3 with reservations, and 2 Herreristas dissenting). FonMin 26 stresses bill will be called for debate in House and Senate right away and expresses firm conviction it will be enacted; responsible congressional opinion is that bill will pass, though sharp debate is anticipated. If this legislation is to be enacted in Uruguay this session, it should be within the next 60 days. However, a further period may be required to implement the program.

Minister of Interior27 repeats assurances that, given legislative authority, he will proceed effectively to eliminate “Nazi firms”. A few like Staudt and Quincke, will probably resort to courts, but the majority of these listed in desp 6034 above are likely to be eliminated within 4 to 6 months after bill is passed.

Although not so effective in all respects as it was formerly, the Proclaimed List has not lost its effectiveness in Uruguay. The termination of armed hostilities, the premature (as regards Uruguay) reduction of the List to a hardcore, especially the current listing policy, and the reduction of personnel available to the Embassy for Proclaimed List work have all had adverse effects to varying degrees, but the vigorous administration of the List in Uruguay in the past is contributing considerably in maintaining its present prestige. The Embassy continues to purchase space in local papers for publication of the complete List for Uruguay on an average of once a month, and the publication of inclusions such as those recently made in Supplement 2 with doubtlessly prove helpful.

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It has been noted with satisfaction that the program for continuation of the List, as approved on February 11 by the Executive Committee on Economic foreign policy, provides that Mr. Braden’s28 Office should be consulted in the early part of April for its “recommendations concerning continuation of the List for Argentina beyond May 8, and possible similar action in other countries which have not satisfactorily carried out replacement program.”

Much adverse public criticism of the progress of Argentina’s replacement program has emanated from various sources in Washington whereas Uruguay has come in for such criticism mainly through implication. The Embassy appreciates that the extent of German holdings and other considerations put Argentina in the Number One position in this respect as regards the American Republics. Nevertheless the fact remains that Argentina appears much farther advanced with a replacement program than is Lruguay.

The Embassy strongly recommends, subject to modification on the basis of future developments in Uruguay, that the Department make arrangements to continue the List for Uruguay beyond May 8. The withdrawal of the List on the eve of possible action by the Uruguayan Congress would seriously prejudice the Administration’s current chances of obtaining enabling legislation and, in the absence of such legislation, would legalize the consummation of certain commercial transactions which would thoroughly discredit the previous actions of this Embassy in administering the economic warfare program in Uruguay.

The foregoing recommendation will be supplemented by more detailed information.

Sparks
  1. Not printed.
  2. Foreign Relations, 1945, vol. ix, pp. 1394 and 1395, respectively.
  3. Not printed.
  4. Eduardo Rodriguez Larreta.
  5. Carbajal Victorica.
  6. Spruille Braden, Assistant Secretary of State for American Republic Affairs.