Memorandum by the Director of the Office of European Affairs (Hickerson) to the Under Secretary of State (Webb)
Mr. Eric Louw, Minister of Economic Affairs and Mines in the South African Government and head of the South African UN Delegation, has an appointment to see you at 11:30 a. m. on May 17.1
Mr. Louw was the first South African Minister to the United States and held a number of diplomatic posts prior to re-entering the South African Parliament in 1937. A biographic sketch is attached.2 The Nationalist Party, of which he is a member, came to power as a result of the General Election in May, 1948.
It is conceivable that the following topics may be bought up by Mr. Louw in the course of his visit:
Complaint in UN by India Against Treatment of the Indian Minority in South Africa.
The South African Delegation to UN has argued that the UN has no jurisdiction in the dispute between India and South Africa concerning [Page 1804] the treatment of the Indian minority in South Africa. During the present session of the UN General Assembly we have not taken a leading part and have favored a simple resolution inviting the two parties to endeavor to resolve their dispute by direct means of their own choice. Such a resolution has been adopted by the Assembly. The South African Government is aware of our moderating influence in earlier discussions of this problem and can have no complaint about our attitude at the Third Session.
South African Application for a $100,000,000 ExIm Bank Credit.
South Africa made a formal application for a loan in January 1949. The ExIm bank requested the South African Government to supply certain additional information to clarify the issues involved in consideration of such a loan. This additional information was supplied by the South African Government late in April and is now being studied. Mr. Louw has an appointment to discuss the loan application with ExIm Bank officials on May 17.
While it is likely that he will refer to the subject, no comment on our attitude toward the loan, other than that the application is being considered, would appear to be required.
Shipments of Manganese to the United States.
This matter will be discussed with Mr. Louw when he calls on Mr. Brown,3 Director of ITP, on May 17. In the event that the subject is introduced by Mr. Louw, the following is a summary of the present situation:
In September, 1948 when this Government initiated several programs to increase its receipts of manganese it appeared that lack of railway cars was retarding shipments from South Africa. We therefore supplied steel to Canada in order to expedite delivery of cars ordered by South Africa in that country. Figures for the first four months of this year show an increase in exports of manganese. It is disturbing, however, to note that the United States is receiving a smaller proportion of the total exports than in 1948.
South African Import Controls.
This subject will also be discussed with Mr. Louw when he calls on Mr. Brown. In the event that the matter is mentioned by Mr. Louw, the following is a summary of the present situation:
The South African Government imposed import controls in November, 1948 on imports from hard currency countries. Because of a deterioration in the sterling position, the South African Government is extending controls to purchases from the sterling area after June 30, 1949. Present indications are that these controls will be discriminatory [Page 1805] against imports from the dollar area as opposed to imports from the sterling area. We feel that South Africa’s sterling position is no better than her dollar position at the present time, and therefore we consider such discrimination unjustified.
In connection with the application of import controls by South Africa, United States shipping has been adversely affected by the fact that freight charges are not deducted from dollar import quotas allocated to South African importers when South African owned on chartered ships are used. As a consequence importers have specified shipment on South African vessels.
We consider that our shipping services to South Africa are of mutual benefit and feel that import controls should not be applied in such a manner as to disrupt existing transportation patterns. For that reason we have welcomed the South African assurance that the preference enjoyed by South African shipping will be terminated on June 30, 1949. It is recommended that you express the foregoing sentiments with regard to shipping to Mr. Louw.