Memorandum of Conversation, by Mr. J. W. Barnet of the International Resources Division

Participants: R. Canedo Reyes, Ministry of Economy
German Rovira, Bolivian Embassy
R. Quiroga Rico, Banco Minero
Sanchez Peña, Banco Minero
Claude Kemper, Aramayo Mines
Mauricio Hochschild, Bolivian Producer
George Jewett, RFC
E. P. Chapman, RFC
Jesse Johnson, RFC
James Espy, NWC
J. W. Barnet, IR

This meeting was held in Mr. Jewett’s office, at the request of Mr. Rovira, in order that the entire Bolivian representation could be in [Page 388] formed of the most recent U.S. Government proposal regarding a new tin ore contract. Mr. Jewett stated the terms as a 62-cent base, with a smelter credit of 1½ cents and a bonus which would provide a maximum of 1½ cents additional if production in a given quarter was 20% higher than the 1943–44 quarterly average; if less than 20%, a proportional bonus would be paid. Mr. Jewett also said that no definite proposal was being made by RFC regarding the length of the contract, although he would recognize the Bolivian’s possible preference for a 9-month contract beginning April 1, 1946. He further stated that if the proposed bonus provision had been in effect in 1945, the Bolivians would have realized approximately 1½ cents per pound. When Mr. Hochschild and Mr. Rovira inquired regarding additional details of the bonus plan, Mr. Jewett went on to say that his statement had merely been one possible proposal and that the question of final terms of the bonus might well be a subject for discussion at the present meeting.

Dr. Hochschild said as his initial reaction, that the offer made by the U.S. was very disappointing. He repeated his previous charges that the Bolivians were being given the burden of inefficient smelting at Texas City and he stated that the former smelting charges and soluble tin payments should be restored. He further said that the closing of mines caused by high costs would make the bonus tonnage very difficult to achieve. He also felt that there should be some retroactivity previous to April 1.

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At this point Mr. Reyes said the base price should be at least 63½¢, but Hochschild quickly said 64½ cents, and Mr. Kemper then argued with Mr. Reyes on this point. Mr. Reyes then said that he meant to say 63½¢ plus an extra amount in accordance with the increase which had taken place in the commodity index. Then Hochschild finally stated that the terms should be 64½ cents base price, plus the old smelter charges and a bonus higher than 1½ cents.

Mr. Rovira was called on next and he said that he thought the producers should get together again and submit a counterproposal to the U.S. offer. Mr. Hochschild then stated that he had just finished making one. Mr. Jewett asked if it should be considered that the U.S. offer had been rejected and Hochschild replied in the affirmative. Mr. Jewett, in conclusion, said that the U.S. was still open to a further counterproposal by the Bolivians although not demanding one, feeling that the offer made by the U.S. was in itself quite fair.