The Counselor of Embassy in Bolivia (Maleady) to the Department of State

[Extract] confidential

No. 370

Subject: Joint Weeka1 No. 41

. . . . . . . . . . . . . .


Meetings have gone on all week between the Minister of Finance and the American managers of the three big mining companies,2 with [Page 755] the American Ambassador in attendance and preventing stalemate on occasion.

According to a Foreign Office official who acted as translator, it appeared several times that substantial agreement had been reached, but each time the representatives of the tin industry have made some new demand; and negotiations are continuing. The Bolivians are apparently glad of the presence of the Ambassador, who they feel will explain their point of view to the American Government and public if they are unable finally to reach agreement with the miners.3

. . . . . . . . . . . . . .

  1. “Joint Weekas” were resumes of each week’s events to which a number of Embassy officers and armed services attaches usually contributed information.
  2. The several companies belonging to the Hochschild and Patiño Groups and the Compagnie Aramayo de Mines en Bolivie.
  3. In telegram 206 from La Paz, October 31, 1950, Ambassador Florman reported in part that the President had on the previous day signed an agreement with the mining industry under which the August 11 decree would be revised so as to allow the tin producers to retain, depending on the price of tin, between 42% and 44% of their foreign exchange receipts. (824.2544/10–3150)

    In a letter of April 9, 1951 to Carlisle Humelsine, Deputy Under Secretary of State for Administration, Thomas O. Mann, then Deputy Assistant Secretary of State for Inter-American Affairs, stated in part:

    “In August 1950 a dispute over certain exchange controls arose between the Bolivian Government and the owners of Bolivian tin mines, none of whom are American citizens. The Department’s information as to what actually took place is meager but it is known that the Ambassador participated in negotiations between the Government and the owners of the tin mines. These negotiations resulted in an agreement between the interested parties, except on exchange controls relating to tungsten.

    “It is correct that this agreement made it possible to obtain the cooperation of the mine owners in increasing production (except of tungsten). The manner in which the Ambassador directly intervened in the negotiations, however, resulted in sharp criticism in the Bolivian press for U.S. intervention in the internal affairs of Bolivia, and the Bolivian Minister of Finance was formally interpellated by the Bolivian Congress concerning the manner of Ambassador Florman’s participation. Another unfavorable result of the intervention was that the United States Government is now identified with the settlement formula and must bear the onus for the dissatisfaction which exists with it.” (611.24/4–951)