Memorandum of Conversation, by the Assistant Chief of the Division of Caribbean Affairs (Walker)

Participants: Under Secretary Clayton
Ambassador Belt of Cuba
Sr. Sergio Clark, Cuban Minister of Communication and Chairman of Cuban delegation to Geneva Conference on Trade and Employment

During the course of the luncheon which Mr. Clayton gave for Señor Clark yesterday at the Blair House, Ambassador Belt indicated that he would like to discuss some of the problems between the United States and Cuba. Mr. Clayton remarked that such discussion would be very helpful. He then stated that he wanted Ambassador Belt to know that the difficulties being experienced by American business men have reached the ears of members of Congress and that unless they are resolved satisfactorily, it is unlikely that Cuba will get a larger sugar quota when new sugar legislation is enacted. Mr. Clayton referred to the inability of American corporations to send technical and executive personnel to Cuba to operate their business enterprises, to the restrictive measures which forced the Seatrain to discontinue operations, and to the pending claims of American nationals against the Cuban Government. If, Mr. Clayton added, the Department were in a position to inform Congress that it had concluded with Cuba a treaty of commerce, friendship and navigation which would eliminate these problems, its efforts to obtain for Cuba a more equitable sugar quota would be immeasurably more effective.

The Ambassador expressed the hope that before the end of his mission in Washington, he would be able to resolve all of the problems between Cuba and the United States. He pointed out, however, that it would not be possible for his President to give favorable consideration [Page 611] to a treaty of commerce until Cuba is given a larger sugar quota. The treaty, he stated, was, in his opinion, a reasonable one but contained some provisions which would be contrary to the Cuban constitution. He went on to say that the treaty, while reciprocal in theory, would actually be far more advantageous to the U.S. than to Cuba since there are many American firms in Cuba, but no Cuban firms to speak of in the United States.

Mr. Clayton stated that as a matter of right and amity, these difficulties affecting. American business firms should be resolved and a solution should not hinge upon a larger sugar quota for Cuba. He further stated that, in his opinion, members of Congress would not react favorably to a suggestion that they would have to give Cuba a larger sugar quota in order to have these matters settled. The Ambassador referred to Cuba’s contribution of sugar during the war, stating that his country was fully entitled to fair and equitable consideration for this contribution. Mr. Clayton admitted that Cuba should be given a larger sugar quota and stated that an effort would be made to obtain a larger quota, but added that this is a matter that rests with Congress. The Ambassador reiterated that it would be absolutely impossible for Cuba to conclude a treaty of commerce until it is given what it considers a fair sugar quota.

The Ambassador stated that when the Seatrain matter was brought to his attention last January, he had suggested through Mr. Falck (SD) that he would be very glad to go to Habana with Mr. Brush17 in order to discuss the over-all problem with President Grau. Mr. Brush, he added, rejected this suggestion. Mr. Clark said that Brush had adopted an unreasonable attitude and seemed to feel that he could force the Cuban Government to accept his terms. He went on to say that a few weeks ago the Cuban Cabinet agreed to pass a resolution suspending temporarily the Decree Law affecting the Seatrain in order to permit the Company to make three trips to Habana to transport some steel freight cars badly needed by the Northern Railroad Company. The matter, he stated, was discussed with the Seatrain representative in Habana who communicated with Mr. Brush and who received instructions to inform the Cuban Government that any proposition of that sort would have to be handled through the State Department. Sr. Clark stated that this attitude on the part of Brush was entirely unjustified.18

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Sr. Clark said that the Decree requiring the use of additional labor would have added very little cost to the operation of the Seatrain, and that the Decree governing the inspection of certain cargo at the port of arrival was designed to prevent the entry of contraband material and would not actually require the inspection of much cargo generally handled by the Seatrain. He explained that the Car Ferry Company, which is subject to the same regulations which the Seatrain Company objects to, is operating so profitably that it intends to purchase two additional vessels.

  1. Graham H. Brush, president of the Seatrain Lines.
  2. Telegram 199, April 24, 1947, 8 p.m., to the Embassy in Cuba stated the following: “Dept informed by Maritime Commission that Seatrain New Orleans will depart for Habana within next two or three days with shipment of railway box cars under contract arrangement with Consolidated Railways. It is Dept’s understanding this trip and others to follow for sole purpose of shipping railway cars should not be interpreted to mean regular service will be resumed.” (800.8836/4–2447)