242. Memorandum From the Acting Assistant Secretary of State for Inter-American Affairs (Rubottom) to the Assistant Secretary of State for Economic Affairs (Kalijarvi)1
SUBJECT
- Mexico’s interest in acquiring corn under PL–480
Although the Mexican Government, until recently, has shown no interest in concluding any sort of agreement with the United States for the acquisition of commodities under the provisions of PL–480, during March of this year the Mexican Minister of Agriculture indicated to our Agricultural Attaché2 at Mexico City that Mexico wished to acquire some 500,000 tons of corn under PL–480. A response to this inquiry was developed in consultation between E, ARA and Agriculture, pointing out to the Embassy for the information of the Minister of Agriculture3 that Title I funds were in very short supply and that there existed a heavy backlog of requests from countries with more serious foreign exchange problems making favorable consideration of Mexico’s request unlikely.
The initial approach of the Mexican Minister of Agriculture was followed by an approach to our Ambassador made by the Mexican Minister of Finance early in April, on behalf of President Ruiz Cortines. The Minister of Finance explained fully Mexico’s need to acquire a reserve stock of corn on credit facilities permitting repayment [Page 747] over a period of twenty years at low interest. In view of the several obstacles to conclusion of a PL–480 agreement with Mexico, other possible methods of meeting this request have been explored informally, but with negative results. In the meantime, it has become evident that Mexico has a very real interest in concluding a PL–480 agreement as soon as possible. The most recent approach is described in the attached memorandum of my conversation with Mexican Ambassador Tello and Mr. Rodriguez Adame during luncheon yesterday.4
While I have pointed out the problems that must be faced in considering a PL–480 sale of corn to Mexico, I am satisfied that the Mexican Government will continue to press for conclusion of an agreement and seek every opportunity to advance its case. At the same time, I believe that it would be in the best interests of the United States to accede to Mexico’s request and strongly recommend that steps to this end be taken as soon as possible.
Under the circumstances, I hope that you will find it possible to agree with me that the request should be placed before the Inter-Agency Staff Committee for consideration with a favorable recommendation from State at as early a date as possible.