837.61351/5–2449
The Ambassador in Cuba ( Butler ) to the Secretary of State
No. 420
Sir: I have the honor to refer to the proposed reduction from 68.75 cents to 60 cents per hundred pounds of the duty on raw sugar imported into the United States from the Dominican Republic and to this Embassy’s telegram No. 140 of May 5, 19491 pointing out that, while the effect in Cuba of such a reduction in the margin of preference now enjoyed by Cuban sugar would be of little economic consequence, the psychological reaction would be of great importance and such a shock to Cuba that the situation would probably be twisted against us politically. In this connection I have read with great interest the memorandum of conversation dated May 16, 1949 describing the courtesy call made on the Secretary of State by the Cuban Foreign Minister, Señor Hevía.
I again wish to emphasize the importance to us politically of refraining now from making any concession of this kind to the Dominican Republic, despite the safeguard to Cuba provided by the quota system. As the Department is aware, relations between Cuba and the Dominican Republic have been strained for some time and there seems to be little prospect of the maintenance of any normal relationship so long as President Trujillo2 remains in office. This antipathy toward the Trujillo Government is particularly strong among the present leaders of the Cuban Government who, with their history of opposition to a similarly repressive Machado3 regime, find and will continue to find Trujillo’s Government most distasteful. This feeling of antipathy toward the Dominican Government is shared by the masses of the Cuban people. Consequently, any reduction in the duty on Dominican sugar which would cut Cuba’s margin of preference in the American market would be bitterly resented by the Government of Cuba and most Cubans. It would undoubtedly be seized upon by our enemies in Cuba, especially the Communists, in support of their long-standing thesis that the Wall Street “imperialists” and the United States Government have been giving economic aid and comfort to dictatorships throughout the world.
Furthermore, any reduction in Cuba’s preferential position might be used, in due course, to justify an unpopular reduction of wages in [Page 633] the sugar industry which could then be blamed on us. In addition, it would undoubtedly be used to point up “Yankee ingratitude” for the services performed by Cuba during the past war as a major supplier of sugar under global contracts. The fact that the reduction would be of little financial benefit to the Dominicans would only emphasize, in the Cuban mind, the pettiness and lack of reasonable justification for such a measure.
Indications of Cuban resentment against the offers made to the Dominicans (and others) have recently appeared in the Habana press. In what might have been an inspired article, the conservative Diario de la Marina on May 20 states that “Palace spokesman” told reporters that, despite the recent important sale of Cuban sugar, the President was worried because of the treatment being given Cuba by the United States with respect to the application of Tariffs. The report continues that the Cuban authorities had learned of conversations between American officials and those of other countries which were “a menace to Cuba’s basic industry” in that they would affect sales to the United States. This report was used as the basis for a leading editorial in the Diario de la Marina on May 22 (for text, see A–679, May 244) which attacked the proposed concessions, principally on the basis of a report that the United States had offered the Haitians a reduction in the tariff on their sugar—a “serious matter for Cuba”.
Commenting on proposed United States financial aid to Brazil, the pro-American daily El Mundo of May 24 in a leading editorial states: “When one talks of sugar preferential that might cause a cardinal modification of our present system, we feel acute misgiving.”
The above-cited press reactions are mentioned here merely as recent illustrations of the Cuban attitude towards this subject. (For previous press material on this point, see Embassy’s A–628, May 10, and preceding airgrams.5)
Since offers have already been made to reduce the duties on Dominican and Peruvian sugar, they might be used by our delegation at Annecy as a lever to bring about a solution of our outstanding trade problems with Cuba. However, I am strongly of the opinion that no reduction of Cuba’s preferential margin should be made now because of the serious repercussions that would ensue to the detriment of our close political and economic relationship with this country.
Respectfully yours,