298. Telegram From the Ambassador in Brazil (Kemper) to the Department of State1

679. Eyes only for Under Secretary Hoover. At farewell luncheon today given by American Chamber of Commerce, Foreign Minister Fernandes talked informally with two prominent American members. He expressed bitter disillusionment with US policy toward Brazil and was intransigent in face attempted replies. Foreign Minister cited failure US lend Brazil desperately needed financial assistance and contrasted this with generosity toward other countries specifically Italy.

This is further example of progressive deterioration Brazilian attitude toward US since Rio Economic Conference. From top-level conversations with US delegates at conference, Brazil assumed tangible US aid would be forthcoming. US refusal with respect definite financial assistance probably responsible for exaggerated importance they place on our rigid position with respect surplus wheat deal.

I feel that our willingness to accommodate Brazil in surplus sale matter would have favorable political and psychological effects here and beyond that we should give them reassuring answer in re Embtel 662.2 My considered opinion is that Export-Import Bank willingness to take over committed obligations for at least first six months would do much to assist in reestablishing Brazilian confidence in US and in enabling Brazilian Government to prevent what might prove complete blow-up.

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I am fully aware of the risk involved in extending financial assistance to Brazil but as a businessman, I feel it justified and as Ambassador essential to our national interest.

  1. Source: Department of State, Central Files, 832.10/1–2055. Confidential.
  2. In telegram 662, January 15, Ambassador Kemper reported a long conversation which he had the previous day with Gudin regarding Brazil’s financial situation. The Ambassador had asked Gudin if he wished to present a concrete proposal for helping to solve Brazil’s economic problems and Gudin had proposed that the Export-Import Bank take over Brazil’s already committed obligations for U.S. imports other than petroleum for 1955. (Ibid., 832.10/1–1555)