8. Memorandum of Conversation1
SUBJECT
- U.S.-Argentine Relations
PARTICIPANTS
- Foreign Minister Alberto Vignes of Argentina
- Secretary Kissinger
- Neil Seidenman, Interpreter
Following a short exchange of views with their principal aides, Foreign Minister Vignes and Secretary Kissinger met alone.
Minister Vignes opened the conversation by saying that the advent of Perón affords an opportunity for Argentina and the US to establish a foundation for cooperation that will be positive, practical, and beneficial to both countries. The time appears to be ripe for this. Argentina is one of the only large countries of the hemisphere, in size and importance, that has a constitutionally elected government, and whose policies are based upon the will of its people, as opposed to some other countries where the situation could be sometimes compared to a time bomb which might go off at any moment. That is why an examination of problems of interest to both countries will be beneficial. He acknowledged that there are differences of appraisal between Argentina and the United States, but even if the objectives of the US were different from the objectives of Argentina, still there should be room for dialogue and agreement despite such differences. He said that the two governments must seek areas of parallel interest so as to get rid of problems [Page 20] which, however small they may be, become irritants to public opinion. Public opinion in Argentina at this juncture is highly sensitized and euphoric as a result of the recent democratic achievement. Therefore, while this euphoria may have certain negative reflections, it can also be channeled to positive ends. That is why it is essential for the GOA and the USG to examine the situation for openings that will be beneficial to the two countries.
In the economic sphere, Minister Vignes noted, Argentina’s balance of payments has shown a chronic deficit vis-à-vis the US. The US, with a market place of more than 200,000,000 people, buys less from Argentina than Argentina buys from the US with its market of only 24,000,000 people. In other words, for each dollar that the US spends for Argentine goods, Argentina buys $2.00 worth. Therefore, there is a need to seek ways to bring about a change in Argentina’s trade position with the US which has been too severely negative, thus seriously affecting Argentina’s balance of payments.
Also in the economic sphere, Minister Vignes continued, he wanted to mention Argentine scrap iron purchases in the US. The present position of the US is that only orders made before July 1 should be filled. In the event that the US does not modify this situation vis-à-vis Argentina, the Argentine steel manufacturing industry will be paralyzed. Argentina’s scrap requirements for 1973 are 140,000 tons and for 1974 some 750,000 tons. With the world scrap market in its present state, the US is the only place the GOA can turn to. Minister Vignes concluded by saying that he would leave a memorandum on this subject with the Secretary’s advisers.
Secretary Kissinger noted that a memorandum would be helpful. There are two problems before us, he said. One is the basic relationship between our two countries, and the other has to do with the specific issues between us in the light of that relationship. With regard to the first, the USG attaches great importance to Argentina. Regarding the second, it must be said that a leader who has been in exile for twenty years who returns to his country and gets 65% of the votes is a man of historic importance. The Secretary stated that in all frankness he preferred to deal with big people rather than small people. They may be more difficult to deal with, but it is more worthwhile. As far as the United States is concerned, our attitude is a positive one: we wish to have close and confidential relations with Argentina. He observed that he is not fully acquainted with the details of some of the specific issues. The question of scrap sales is an example. But if the Minister would leave a memorandum on the subject, he will ask Assistant Secretary Kubisch to deal with the matter. The important thing is to establish the possibilities for cooperation between the two countries.
Turning to another subject, the Secretary said that he understood that Argentina has credit arrangements with Cuba. The Minister [Page 21] acknowledged this to be the case but said that this is purely a financial operation, aimed only at enabling the Argentine farm machinery industry to operate at full capacity. He said that Cuba knows that Argentina is “justicialista” and anti-Communist, as he personally had occasion to put it to Castro in Algiers. Vignes said that there is a problem that he would wish to solve with the US in connection with the Cuban credit arrangement, involving Argentine ships carrying Argentine products to Cuba. These ships operate at considerable loss, because they have to return empty and cannot enjoy refueling and reballasting privileges in US ports under certain rules in effect at this time. It would be of maximum interest for Argentina to see a revision of this position on the part of the US so that Argentine ships might be serviced in US ports.
The Secretary replied by noting that there may be difficulty with this. He promised to look into it, but in the light of present legislation, it is very doubtful. Also there is the matter of American companies in Argentina, which are being pressed to take part in these arrangements. This places them in the awkward position of being in violation either of Argentina’s laws or US laws.
Turning to the political area, Minister Vignes said that Argentina is concerned with the indifference of the US regarding the issue of the Falkland Islands, which is a colonial problem within the hemisphere. He could not understand how the US, which was once a colony, could take such an attitude. Accordingly, he would be pleased if the USG were to suggest to Great Britain that it activate negotiations in this regard.
On the question of the Organization of American States, Minister Vignes said that he was aware that the thinking on the part of the US differs from that of the Latin American countries. But he believes that, through frank discussions, it will be possible to make changes that will meet the interests of all the parties.
The Secretary responded that he also believed this will be possible. Of first importance is that Argentina and the United States have close contacts. He promised to deal frankly with the Minister. He said that he was not a professional diplomat, and will say what he thinks. He hoped that the Minister would deal with him in a similar manner. Minister Vignes assured the Secretary that he would, saying words to this effect: I am a professional diplomat. I was an official with the first administration of General Perón, as Under Secretary of Foreign Relations. I am a close and personal friend of Perón’s, and I will be able to cooperate in a way that will constitute a contribution to the new relationship between the US and our country.
The Secretary recognized that certain things must be done for domestic reasons. If certain things reinforce the domestic situation, this is often helpful in the area of foreign policy. But it is also important to take long-range considerations into account.
[Page 22]Minister Vignes said that he wanted to mention that the Argentine Government has submitted various economic and financial bills to the Legislature, some of which have a bearing on foreign investment. In these, foreign investment is fully guaranteed. It should be noted that all foreign investment that was made during the first administration of Perón is still in effect. Any investment in Argentina will be made under ground rules that are perhaps stricter in nature than heretofore, but which were constitutionally arrived at through congressional action based upon the initiative of the constitutionally elected government. This is distinct from situations that prevail in certain countries with de facto governments which, while very favorable for a given period of time, could change drastically and do away with everything at once without warning.
At this point the private meeting ended with Secretary Kissinger saying that the meeting had been helpful and Minister Vignes expressing his gratification. The other members of both delegations were then invited back for a brief discussion of a press communique.
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Summary: During the UN General Assembly session, Kissinger and Vignes discussed U.S.-Argentine relations.
Source: National Archives, RG 59, Central Files 1970–73, POL ARG–US. Secret; Exdis. Drafted by Neil Seidenman in OPR/LS and cleared in S. The conversation took place in the Waldorf-Astoria Hotel. In telegram 6997 from Buenos Aires, September 24, the Embassy reported that Perón won the Presidential election on September 23 with about 61.5 percent of the vote. (Ibid., Central Foreign Policy File, [no film number]) In a September 28 memorandum, Kubisch briefed Kissinger for his meeting with Vignes. (Ibid., Central Files 1970–73, POL 7 ARG)
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