The Acting Secretary of State to the Embassy in Colombia
134. For Amb from Miller. Deptel May 9.1 Grace and United Fruit have expressed very strong opposition any deviation whatever from terms agreement and insist that it be put into effect immed.
I personally am seriously concerned over this matter in view direct participation you and I had in negot agreement2 and consequently feel [Page 831] that even though it is not an inter-governmental agreement good faith Colom Govt is committed. Under circumstances feel that serious breach of principle involved which gravely prejudices our relations Colom Govt and which does not augur well for Laureano Gomez promises about favorable treatment Amer business interests. Fact that Coloms dol position has steadily improved during last year underlines seriousness failure Colom to honor its word in this negot.
Before any further discussions with Colom looking to compromise suggest you inform FonMin and Pres my views and particularly about difficulties that may be caused to Coloms standing in US in absence literal compliance with agreement. Have told this to Zuleta tonight and have informed him that this may cause serious difficulties with pending loan applications.
You may also inform Ospina and FonMin that Grace and presumably United Fruit are prepared immed upon effectuation of agreement to commence discussions with Flota re obtaining fair share cargo.3 [Miller.]
In its telegram 131, the Department had reported in part its suggestion to the Grace Line that the latter seriously consider Ambassador Beaulac’s compromise proposal to which its own initial reaction was favorable. (921.53/5–850)
This proposal in part coupled Minister Sourdis’ suggestion of May 5 that southbound freights might be paid in either dollars or pesos (the pesos to be immediately convertible) with Ambassador Beaulac’s recommendation of May 8 that the Colombian exchange tax be suspended on such conversions. (File 923.53 for May 1950)↩
- Of October 17, 1949. See memorandum by Ambassador Beaulac, March 31, 1950, p. 811.↩
- In despatch No. 580 from Bogotá, May 15, 1950, Ambassador Beaulac reported in part that he had carried out this instruction in a conversation with President Ospina on May 11. (921.53/5–1550)↩