The Acting Secretary of State to the Embassy in Mexico
982. Strictly for your own info Dept concerned abrupt termination mil assistance negots wld have adverse effect upon negots other Latin [Page 1329] Amer countries and lend itself to intensification propaganda in Mex against US. Although Mex attitude reported urtel 1026 Feb 121 indicated no basis anticipate any favorable result you shld keep negots alive for time being using such means you consider advisable but avoiding any misunderstanding as to requirements for Mex participation this program. Suggest one means might be request for more detailed explanation Mex proposal.
Is it possible interpret Mex proposal as indication they hope bargain basic mil agreement in return for machinery for mil industry? Mex has requested DO priority rating for approximately one-half million dols worth machinery to complete and modernize mil factory. Request previously made through reimbursable aid channels under Section 408(e) MDAA2 but present move wld have effect of Mexs acquiring it through immed manufacture on commercial basis. Am Section Joint Mex–US Defense Comm will hold mtg tomorrow to consider position it shld take re DO rating.
Further instructions will follow after receipt of info from you concerning result of mtg with Mexs held today.
Send air mail official text FonOff statement announcing initiation negots.
- The Mutual Defense Assistance Act (Public Law 329), approved on Oct. 6, 1949, provided under Section 408(e) that the President may sell military equipment to a nation which has joined with the United States “in a collective defense and regional arrangement.” For text of the Act, see 63 Stat. 714.↩