156. Summary Notes of a Meeting of the Delegation’s Steering Committee, Buenos Aires, August 28, 19571

Coordinating Committee. Ambassador Dreier reported that there is strong sentiment, promoted especially by the Mexicans, that a conference like this one be held every three years for the purpose of pressuring the US. The basis for this sentiment is the fact that it is through such repeated pressure that the Latins have obtained concessions from the US over the years. Mr. Rubottom suggested, and it [Page 539] was agreed, that we should take the position that, instead of such conferences as this one, extraordinary meetings of the IA–ECOSOC should be used.

Duration of Conference. Mr. Rubottom said that Beckmann2 had agreed to have a Plenary Session beginning between 4:00 and 5:00 on Thursday afternoon. Beckmann also agreed that the Conference would end on September 3 or September 4. Mr. Dillon suggested that at the meeting of the Coordination Committee today we should seek to get final approval of the Plenary Session on Thursday.

General Economic Agreement. Mr. Leddy reported that at 10 a.m. today the Brazilians and Mexicans are to present to us their joint draft of a resolution.

In Sub-Committee A3 a review has now been made of the first eleven articles of the Secretariat draft, and the US has reserved on several of the articles.4

Mr. Corliss reported that in Sub-Committee B article 13 on price stabilization had been redrafted, but in many respects it is still objectionable to the US. Other troublesome articles, 17, 18 and 19, will be discussed today. It was agreed that the US should reserve on articles 13, 17, 18 and 19, and that we should not get involved in detailed language changes in Sub-Committees A or B.

Economic Development. Mr. Corbett reported that Sub-Committee B had completed its work and reported to Committee II.

In Sub-Committee A, he said, work has been completed on the resolutions having to do with financing economic development, except the proposal for an Inter-American Bank. There is a small group drafting a resolution about such a Bank. In the Whereas section of the draft, reference is made to private investment and the existence of present banks. Also, this section refers to “some governments” which place reliance on private investment and the present international lending institutions. “Other governments”, however, [Page 540] believe otherwise. The Rio resolutions establishing the committee of experts and also the CPR recommendations for a study are described. In accordance with the CPR recommendations, there should be a study of the flow of capital to Latin America. And it is resolved that these recommendations should be implemented as soon as possible. For this purpose, Chile is pressing for the establishment of a time limit. The study would be made by government experts, and when it is completed, the OAS would consider measures for implementation. The Latin Americans are making a strong endeavor to have the US committed to take action after the study is made. In a word, they are trying to get a commitment for a new banking institution. The resolution urges governments to take measures to increase the flow of private investment.

On the Mexican resolution about the IBRD, the Bank is in agreement and we can concur. Mr. Corbett pointed out that there will be many differences of opinion on the two points involved in this resolution, general credit lines and financing of local expenditures.

Foreign Trade. Mr. Nichols reported that the 10:30 meeting this morning may be the final one for Committee III. It was agreed, however, that if serious problems for us come up in this meeting we should reserve on them and ask that the final meeting be postponed until we have an opportunity to study further the proposed resolutions.

Bolivian resolution 745 seems to be a dead issue. The subcommittee is reporting that it can do nothing about the proposal, and the Bolivian has returned to La Paz.

Proposed resolution 1006 on terms of trade is acceptable to us in providing for a study, but if a US draft sentence in the Whereas section is not accepted, we shall have to abstain on that portion of the resolution.

The Mexican and Argentine resolution on surplus disposal is a generally worded one complaining about US operations in this field.7 We have stated in Committee III that we are willing to talk about specific problems but that we are against such a generally worded document. A sub-committee of five has been set up to endeavor to draft an acceptable resolution. This group is meeting at 9:30 this morning. The US objective is to recognize the importance of the [Page 541] problem but not to condone any general condemnation. The troublesome points are prior consultation and non-interference with traditional markets. Mr. Nichols expressed the opinion that use of the word “timely” would be satisfactory with respect to consultation. It was agreed that a draft of this resolution would be brought back for review by the delegation before final acceptance, and because of this Committee III should not hold its last meeting this morning.

There was a lengthy discussion of the proposed resolution on basic products. We have already made clear to the Latins that paragraph 5 of the Whereas and paragraph 2 of the Resolves are unacceptable to us. Also, however, the entire framework of the resolution is unsatisfactory. Our position is that we cannot commit ourselves in principle to commodity agreements. We are willing to recognize the importance of stable income, and we are willing to study the problems of individual commodities. It was agreed that we will draft a resolution ourselves and give it to the Latins as the most that we can accept. It was also decided that if the work of the drafting group this morning does not result satisfactorily, Mr. Dillon or Mr. Rubottom might go before the full sub-committee to explain our position. Mr. Dillon will also contact the Peruvian and Chilean delegations to point out to them that the studies they desire are being jeopardized.

In Committee IV the US is having difficulties with a resolution on a common market. Six resolutions8 were presented on this subject and a drafting sub-group working on the basis of the Brazilian draft is trying to find acceptable language. The following point is of particular importance to us and on it we are in conflict with several of the countries, especially Argentina:

A declaration that the countries of the hemisphere should approach a regional market progressively and selectively.

Limited preferential arrangements are implied, and this is unacceptable to the US. We have discussed this problem with the Brazilian, who chairs the drafting group. He is willing to see the entire resolution dropped except for the fact that he thinks it essential that the Conference have some resolution on this subject. Mr. Dillon today will endeavor to discuss this problem with Santa Cruz of the ECLA staff. It was also agreed that Mr. Pappano9 should take up the matter with the Argentines.

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In Committee IV there has been approved a general resolution approving liberal terms of trade.

The Paraguayan and Bolivian proposals in Committee IV on land-locked countries is difficult because of our policy on most-favored-nation treatment and because of our trade agreement with Paraguay. That agreement provides for an exception, with regard to Paraguay’s neighbors. The problem for us revolves around preferences that the land-locked countries would give neighbors and the preferences that those neighbors might be expected to give the landlocked countries. Mr. Pappano expressed the belief that the matter of preferences will be dropped. They have been thrown in with the main issue, which is to provide freedom of transit for the landlocked countries. If, however, the question of trade preferences is not dropped, the US delegation will have to consider the matter further.

Technical Assistance. Dr. Picó reported that Committee V has almost completed its work. It has disposed of resolutions on the new center, on an agricultural institution (in line with CPR recommendations) and on the permanency of a housing center. There remains, however, the difficult question of the Argentine-Brazilian proposal about contributions. The Brazilians were not present at the meeting yesterday of the committee. The Argentines agreed with us in advance, but in the meeting they attacked the US position. We would want a resolution providing only for further study and discussion of the problem of contributions. Apparently, only Cuba sides with us. The Costa Ricans will probably go along but believe that the resolution is useless. The Brazilians are not being helpful to us. They are leaving it to Argentina and Uruguay to maintain the Latin position. It was agreed that we should state in the committee that the US prefers no resolution but that the most we can agree to is a general and non-committal one.

Transportation. This committee has approved and submitted the following resolutions:

The continuation of an ad hoc committee on freight rates.
A recommendation on uniform maritime statistics.
Taking note of the work of the 7th Pan American Highway Conference,10 without making any mention of financing the Darien section of the Pan American Highway.
The promotion of uniform and stable freight rates.

Mr. Nolan pointed out that all of the following resolutions are entirely acceptable and desirable from the US point of view.

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A working group is dealing with three resolutions on the River Plate system and it is likely that consolidated resolutions will be drafted today.

Driscoll–Krieger Interview. Mr. Rubottom mentioned that Mr. Driscoll11 is calling on Minister Krieger Vasena12 today. It was agreed that Mr. Driscoll will simply listen and report back the results of his conversation.

  1. Source: Department of State, OAS Files: Lot 60 D 665, USDel Meetings. Official Use Only. Drafted by Sanders.
  2. Conrado Carlos Beckmann, Argentine Ministry of Foreign Relations, Secretary General of the Conference.
  3. For information concerning the subcommittees established to review portions of the Draft Economic Agreement in Committee I of the Conference, see Economic Conference: USDel Report, pp. 4–5.
  4. Soaec 45 from Buenos Aires, August 28, 10 p.m., reads in part: “USDel considers Mexican-Brazilian draft seriously defective being unbalanced and tending commit US to principles contrary US policy even though it is resolution. As it has not proved possible use text alternate B as basis of negotiations US has prepared thorough revision of Mexican-Brazilian draft which being given them tonight as tentative US position. Expect meet with Brazilian-Mexican [representatives] tomorrow morning in attempt work out agreed draft.” (Department of State, Central Files, 365/8–2857)

    “Alternate B” or Alternative B was the name given to a draft of a general economic agreement prepared as a negotiating paper for the U.S. Delegation. A copy of the paper, August 5, together with related documentation, is ibid., OAS Files: Lot 60 D 665, Committee I—General Economic Agreement.

  5. This resolution, entitled “Elimination of Restrictions on Trade”, was introduced to the Conference as Document 74, not printed.
  6. This resolution, entitled “Terms of Trade”, was introduced to the Conference as Document 100 by Argentina, not printed.
  7. Mexico and Argentina both introduced resolutions to the Conference: respectively, Document 98, “Price and Market Problems of Basic Products”, and Document 105, “Recommendation on Surpluses of Primary Products”, neither printed.
  8. A handwritten notation on the source text indicates that these resolutions were introduced by Argentina, Brazil, Chile, Mexico, Peru, and Uruguay.
  9. Albert E. Pappano, Chief, Trade Agreements Branch, Trade Agreements and Treaties Division.
  10. Held in Panama City, August 1–10; pertinent documentation is in Department of State Central File 398.2612–IA and ibid., OAS Files: Lot 60 D 665.
  11. Hilary A. Driscoll, Chamber of Commerce of the United States in the Argentine Republic; Adviser to the Delegation.
  12. Adalbert Krieger Vasena, Argentine Minister of Finance.