837.00/3–248
The Ambassador in Cuba (Norweb) to the Secretary of State
No. 165
Sir: I have the honor to forward the following comments regarding the political implications in Cuba of the recent purchase by the United States of one million tons of Cuban sugar outside the United States quota.1
The recent agreement by which the United States purchased one million tons of Cuban sugar outside of the United States quota has special political implications coming as it has only three months before general elections in Cuba. It will claim a leading place among the chief accomplishments of the Auténtico Administration and thus contribute immeasurably to its prospects of success at the polls. This transaction has afforded additional political leverage from the fact that publicity, chiefly of Cuban origin, has created the widespread impression that the Administration not only initiated the negotiations but by exceptionally astute effort concluded the contract, so advantageous to Cuba’s principal source of national wealth and employment. This distortion of the facts was made possible because the Cuban Ambassador in Washington, Ghillermo Belt, was afforded an unprecedented opportunity for that purpose by the inept manner in which publicity was handled by our news agencies in Washington. Practically no publicity emphasizing the fact that the United States initiated the negotiations [Page 551] and that most of this sugar would probably be given away has appeared in Cuba.
In the last two or three months one of the most critical questions in Cuba has been the disposal of the 1948 sugar crop. It could have been a tremendous factor against the Administration in the June 1948 elections. The shortage of dollar exchange throughout the world and the inability of Cuba to deal in any other currency made it seem very likely that a huge surplus would remain unsold this year. Despite this, however, in answer to labor pressure the Administration went ahead in December and decreed that the high 1947 wages should be paid during the 1948 crop—thus apparently going way out “on a limb”. Now, however, the Grau Administration is able to say that it took the necessary steps for the sale of one million tons of sugar outside the United States quota, that it refused the first offer of the United States of 3 and ½ cents as too low, and that it forced the price up to 4 cents a pound (a price above the average which might have been anticipated if any effort to dispose of a large amount of sugar on the world market had been necessary). Although the internal difficulties in the Auténtico Party continue unsolved and although the events of the last two months would not normally have enhanced the prestige of the Administration, the completion of the sugar deal has given the Grau Government a most powerful political card.
This coup was accomplished by Belt and President Grau despite the fact that when Belt was negotiating in Washington he had no sugar to sell and when he and Grau were negotiating in Cuba with the mill owners and cane growers they had no definite purchaser. By the use of clever maneuvering they have managed, however, to bring the deal off, a triumph for which the Cuban Government has not been obliged to give any quid pro quo whatsoever.
Respectfully yours,
- Translation of Decree no. 586 providing for the segregation of 1,250,000 long tons of Cuban sugar of the 1948 crop, was published in the Gaceta Oficial of February 26 and effective on that date; before the Decree was drawn up in final form, agreement had already been reached on the sale of 1,000,000 short tons of this segregated quantity for the use of the United States Army in Occupied Areas. This sale left Cuba with an estimated “surplus” of only about 420,000 short tons (370,000 long), according to despatch 190, March 9, 1948 from Habana, not printed (837.61351/3–948).↩