Memorandum by the Chief of the Division of American Republics Analysis and Liaison (Dreier)30

FLC Field Commissioner for Latin America, Mr. Kidd, has, on the advice of the FLC here, solicited and obtained offers from Uruguay and Chile to purchase surplus construction equipment which is located in the Pacific Islands.

Uruguay offers to buy $1,000,000 worth of equipment. They offer fifty percent down payment in cash, the remaining to be paid in one year.

Chile offers to buy approximately $1,500,000 worth of equipment. They offer one-third down, the remainder in two equal annual payments.

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Mr. Kidd intends to detail a man from his staff to accompany representatives of these two countries to the Pacific for the purpose of inspecting and selecting the material they wish to buy.

There are several problems, including shipping, which have to be worked out before these transactions can succeed. These problems are being discussed on Tuesday morning, April 9, at a meeting of the State-War-Navy Subcommittee for Latin America, at which Colonel Smith of FLC will be present. Solution of these problems will open the way for further purchases of surplus from the Pacific by Latin American countries. FLC has been advised not to solicit any more offers until these problems are cleared up.

In regard to Uruguay and Chile the immediate problem is to approve the credit which they have requested as outlined above. The arrangements outlined seem to me to be entirely satisfactory, and I recommend that we inform FLC of ARA’s approval.

Please indicate your opinion of this recommendation so that I may inform FLC.

John C. Dreier
  1. Addressed to Thomas C. Mann, Assistant Chief of the Division of River Plate Affairs, and to Ellis O. Briggs, Director of the Office of American Republic Affairs, each of whom indicated in the margin his “O.K.” The memorandum was also addressed to Joseph Flack, Chief of the Division of North and West Coast Affairs, after whose name appears the following: “Wells and I both approve and think this is a fine idea.”