832.51/8–2946: Telegram

The Ambassador in Brazil (Pawley) to the Secretary of State


1529. In conference with Ambassador Gracie,17 Finance Minister Vidigal and Transportation Minister Macedo Soares discussed Vale do Rio Doce. All three assured me that President Dutra had authorized expenditure of equivalent to US $25,000,000 additional for completion railroad and ore project. Transportation Minister feared that if this project were necessarily tied in to Export Import Bank loan Brazil might be unable to utilize this badly needed assistance.

I feel confident Brazilian Government will not hesitate to make necessary funds available for completion this project by late 1948 and recommend against tying new loan to Rio Doce project.18

  1. Samuel de Souza-Leão Gracie, Acting Minister for Foreign Affairs.
  2. In telegram 1165, August 31, 1946, noon, the Department instructed the Embassy to obtain written confirmation that the $25,000,000 would be available immediately, and that more funds would be available to complete the project in 1948. This condition was not to be made, however, a part of the loan agreement covering the new credit. (832.51/8–2946)