The Ambassador in Cuba (Butler) to the Secretary of State 1

No. 488

Sir: Inasmuch as Cuba at this moment faces a very serious problem in finding a profitable dollar outlet for about 1,500,000 short tons of sugar from the largest crop the country has ever produced, I have the honor to suggest that this is a propitious time to negotiate a settlement of our principal long-standing problems with this country.

In making this suggestion I take into consideration the fact that undoubtedly additional sugar from this Hemisphere will be required for the Economic Cooperation Administration program and that the recent Cuban general elections have not only removed that event as an obstacle to negotiations but have given some indication of the [Page 558] character of the administration that will hold office for four years beginning in October.2

The recent reduction of 500,000 short tons in the United States sugar consumption quota, which reduced Cuba’s share in our market by approximately that amount, plus an unplaced surplus of about 1,000,000 short tons of world quota sugar, presently confronts Cuba as a problem of the first magnitude, involving as it does a heavy financial burden on the industry from the standpoint of payments for cane and wages, and uncertainty as to certain government revenues derived from sugar. The problem of accumulating stocks of unsold sugar, therefore, is of deep concern to the basic Cuban industry and to the Cuban economy in general, as well as to the Government. This has been evidenced recently by daily newspaper editorials, by the recent visit of representatives of the Cuban sugar industry to Washington, and by the more recent call of Ambassador Belt on the Secretary of Agriculture.

On the other hand, the present Cuban administration and its predecessor have allowed to grow and to accumulate an increasing number of problems that greatly concern us, and from what is now known about the next administration there is little ground for optimism that progress will be made in any early solution of such problems without insistent urging and prodding on our part. Without relation to order of importance I list such problems briefly as follows:

Negotiation at once of a Treaty of Friendship, Commerce and Navigation (under any appropriate title);
Payment immediately of claims to American citizens;
Setting up promptly of a claims commission;
Settlement at once of the Seatrain problem;
Abrogation immediately of Decree No. 4504;
Correction immediately of violations of the Trade Agreements.

I suggest that there is nothing inconsistent in policy and procedure in requesting the present Cuban administration to demonstrate its adherence to the principles of fair and equitable treatment by clearing up these problems—not by promises but by performance—before any indication is given as to whether or not we will purchase additional Cuban sugar this year. In making this suggestion, because of the prevailing situation here, I see no reason for paying more for any such purchases of sugar than would be paid under other circumstances.

A transaction of the nature proposed would seem quite clearly to be on a Government to Government basis, since controls in Cuba would be exercised by an official agency. Moreover, such negotiations [Page 559] would not relate to trade with the United States, but to a voluntary relief purchase in an operation that is not habitual or continuing, and which therefore could not be construed as a coercive measure to gain advantage, the advantage in fact being obtained by Cuba.

I sincerely trust, therefore, that the Department, in collaboration with other interested agencies of our Government, may find it possible to work out an early solution for our pending problems with Cuba on the basis outlined above.

Respectfully yours,

Robert Butler
  1. On June 9 Ambassador Butler also addressed a personal letter on this subject to Assistant Secretary Armour.
  2. Carlos Prio Soearrás, of the Auténtico Party, was elected on June 1 to succeed President Grau. For press release of October 1 concerning the inauguration of the President-elect, see the Department of State Bulletin, October 10, 1948, p. 471.