Memoramdum of Telephone Conversation, by the Acting Officer in Charge of the Division of Central America and Panama Affairs (Wise)

Mr. Wise called Ambassador Davis this morning—on the Quarry Heights line, for security reasons—to discuss the desirability of Panama’s taking the initiative in securing United States recognition by addressing a note requesting such recognition and giving certain assurances desired by the United States regarding acceptance of official acts and commitments of previous governments as legal and binding and treatment of foreign investments in Panama. Mr. Wise pointed out that there was ample precedent for such a note in other recent cases of recognition in Latin America and expressed the Department’s concern that Arias himself had not yet given the desired assurances. He also stressed the desirability of having such assurances in writing. Mr. Wise said, however, that Mr. Miller wished to maintain the recognition schedule already agreed to and Mr. Davis agreed that no step should be taken now which might disrupt that schedule.

Mr. Wise then inquired whether the Embassy’s rigid observance of the non-recognition policy might have closed the door to such a note from Panama. Ambassador Davis said that Foreign Minister Brin had attempted to reach him by telephone but he had discouraged this approach. Mr. Davis felt that failure to deliver such a note probably could be explained as respect for our seeming wishes.

As the idea of arranging for Panamanian initiative in the matter of recognition was explained to the Ambassador, his enthusiasm for [Page 742] this type of approach increased. Mr. Davis said that he regarded the informal assurances already delivered orally by President Arias in his address before the National Assembly on November 30 and by Dr. Brin in his statement to the press on December 6 as fairly complete and that the substantial American private interests in Panama are fairly well convinced of the good intentions of the new administration. The Ambassador concluded that, in his opinion, a Panamanian note of the type suggested was not indispensable or essential but certainly desirable and well to have on record. He said too that he believed that the Panamanians would appreciate any hints as to how U.S. recognition might be speeded up and that his very action in offering the suggestion would create a most favorable impression.

Mr. Wise then stated that our desire for the delivery of such a note might be put across to the Panamanians through any of the following means:

An open-line conversation between Mr. Wise and the Ambassador on the assumption that the line would be tapped;
Mr. Wise to discuss the matter with Mr. Chevalier in Washington;
Mr. Davis to drop the suggestion in Panama.

Mr. Davis preferred the third approach as the most effective and expeditious. In view of his personal friendship with the new Foreign Minister, Mr. Davis felt he could informally put the suggestion across quite easily and without risk. He thought such a statement could be obtained by Saturday.1 The Ambassador then was told to proceed as instructed unless the Department called him back within an hour.2

At one point in the conversation, the Ambassador stated that the Department’s press releases on the Panama situation had been most helpful to him and had had the desired effect in Panama.

Comment: Shortly after this call was completed, the Department was informed by an official of Standard Gil that one of the new Vice-Presidents had informed the oil companies operating in Panama that they were expected to make a million dollars available to the Government or face monopoly legislation on distribution of petroleum products. The Ambassador apparently was not aware of this development at the time of the call. This development underscores the desirability of possessing the type of written assurances under discussion.3

  1. December 10, 1949.
  2. Ambassador Davis reported in telegram 812 from Panama, December 9, 1949, not printed, that Dr. Brin had given him oral assurances (819.01/12–949); these were followed by Dr. Brin’s formal note, transmitted in telegram 815 from Panama, December 10, 1949 (819.01/12–1049). The substance of the Panamanian note is contained in Department telegram 488, December 12, to Panama, infra.
  3. In telegram 822 from Panama, December 12, 1949, Ambassador Davis said in part that Dr. Brin had assured him the approach to the oil company was unauthorized by, unknown to, and disapproved by President Arias (819.6363/12–1249).