NAC Files, Lot 60 D 1371

Minutes of Meeting No. 174 of the National Advisory Council on International Monetary and Financial Problems, Held at Washington, April 26, 1951


[Here follow a list of those persons present (20) and a discussion of a proposed settlement of United States Government postwar claims against West Germany.]

2. Proposed Export-Import Bank Loan to the Sociedad Minera Argentine, S.A.

Mr. Glendinning2 said that the proposal covered a $5 million loan, not more than $2 million of which would be for sulphur and the remainder for tungsten. The loan would be to a private Argentine company without a government guarantee and would be supported by an appropriate contract with GSA for the acquisition of tungsten. The contract would cover at least 10,000 metric tons, and possibly 16,000 metric tons, of concentrates. The major question was that of the attitude of the Argentine Government with respect to that aspect of the problem. The proposed terms were that the credit be for 7 years at an interest rate of 5 percent (NAC Document No. 1130).3

Mr. Thorp4 said that the key international problem here, assuming the technical operations were feasible, was making certain Argentina would allow the tungsten to be exported. The State Department was asking Mr. Williams, the promoter, to undertake to get a commitment from the Argentine Government. The State Department had felt that in all probability this would be adequate, since Argentina had a fairly good record of living up to commitments it has put on paper. In order to provide additional assurance the Department proposed that at some [Page 1100] appropriate point, after an agreement had been reached between Mr. Williams and the Argentine Government, there would be a confirmation of that agreement through the United States Embassy in Argentina. This Government would then be in a position to insist that the tungsten be made available.

The Chairman5 observed that this was fundamental to the credit. Mr. Gaston6 said that there were certain reasons why the United States Government should not initially approach the Argentine Government on this point, since for example, the question of how much would be paid for the tungsten might arise. He added that the Export–Import Bank would have no liens on anything and no guarantee. Their guarantee would lie in the self-interest of Mr. Williams and of the Argentine Government. The Argentine Government would gain dollar exchange and Mr. Williams would have a profitable contract. Furthermore, he had a good reputation as a competent businessman.

The Chairman said he assumed that before the Bank started extending cash advances there would be assurances the United States would get the product. Mr. Gaston said that Mr. Williams had agreed on his own account to produce the necessary export licenses and any other papers that were necessary.

Without further discussion the recommended action was unanimously approved.

Action. The following action was taken (Action No. 464):

The National Advisory Council approves consideration by the Export–Import Bank of a 5 percent 7-year credit to the Sociedad Minera Argentine, S.A. (Sominar), an Argentine corporation, in the amount of approximately $5 million to finance the dollar costs of machinery, equipment and supplies for the production of tungsten and sulphur, of which not more than $2 million would be for sulphur production.

  1. Master file of documents of the National Advisory Council on International Monetary and Financial Problems (NAC) for the years 1945–1958, as maintained by the Bureau of Economic Affairs at the Department of State and subsequently preserved as item 70 of Federal Records Center accession 71A 6682.
  2. C. Dillon Glendinning, Secretary of the National Advisory Council (NAC).
  3. Not printed.
  4. Willard L. Thorp, Assistant Secretary of State for Economic Affairs.
  5. John W. Snyder, Secretary of the Treasury and Chairman of the NAC.
  6. Herbert E. Gaston, Chairman of the Board of Directors, Export–Import Bank.