611.1631/142
The Minister in El Salvador ( Corrigan ) to the Secretary of State
[Received April 2.]
Sir: I have the honor to refer to the Legation’s despatch No. 618 of March 5, 1936,7 on this same subject, and particularly to the last paragraph thereof, reporting that President Martinez had promised to arrange an interview with the Minister, and to concede sufficient time for a thorough discussion of the various items covered by the tentative Schedule I (forwarded with the despatch under reference), before the Government should make a final decision relative to the concessions to be granted.
The conversations with the Ministry of Finance have reached the point where very little in the way of further concessions is to expected; and according to the Report of the Ministry read to the Legislative Assembly on March 19, 1936, (covered by despatch No. 633 of March 25 [23], 1936 from this Legation7), Minister Samayoa is opposed to the principle of most-favored-nation treaties. In the circumstances, it appeared desirable to discuss the present status of the negotiations with the President.
Minister Corrigan, accompanied by Secretary Cochran,8 went by appointment to the Casa Presidential on the morning of March 24th, and in a lengthy interview with President Martinez, reviewed Schedule [Page 561] I item by item. Certain further concessions were accepted by the President, with the proviso that they be referred back to the Ministry of Finance for approval.
As the Department is aware, every problem in El Salvador is considered by the Government primarily from a political angle; and the President was quite frank in explaining that his inability to grant certain concessions, which appear desirable on purely economic grounds, was due to political considerations. For example, the concession requested on dried milk is of relative unimportance to the economy of the country. The President pointed out, however, that the economic condition of the dairy farmers is bad, and that they would oppose and resent any reduction of the duty on dried milk, however small its actual importance. Another complicating factor, to the President, is the evil of smuggling from the neighboring countries of Guatemala, Honduras and Nicaragua, if Salvadoran tariff rates are too high in relation to the duties applied by those countries. He expressed a desire to study the duties applied, in those countries, to the items included in Schedule I, before making a final decision as to the concessions which El Salvador may grant. Steps have been taken to obtain this information from our Missions in those countries, and a table will be prepared for the President’s consideration.
A pleasant feature of the interview was the friendly spirit and obvious desire to cooperate which the President manifested during the conversation. His actual concessions were made with extreme caution, and he was obviously actuated by a fear that the possible loss of revenue might upset the present economic balance of the country’s and the Government’s finances.
Negotiations with regard to Schedule I are now apparently drawing to a close, although study of the tariff rates of the contiguous countries will be a necessary preliminary to completion thereof. The time required to obtain this information will bring us to Holy Week when, as the Department is aware, all government offices are closed, and nothing can be accomplished.
Two details arose on which the Department’s advice is requested. While the President considered it impracticable to grant a reduction on dried milk, he was favorably inclined towards a reduction affecting only dried and powdered milk which has been modified or treated especially for baby food. It is desired to draft an item covering such products as dried milk irradiated by the Steinbock process of the University of Michigan, “S, M. A.”, lactic milk, et cetera.
The President also offered to consider a concession on phonograph records other than current “jazz”. It is thought that an item reducing or abolishing duties on classical records, or those by deceased composers or musicians, would meet with his approval. It would be [Page 562] appreciated if the Department would suggest possible wordings for these items, for submission to the Salvadoran Government.
In the meantime, the question of Schedule II having been broached by Doctor Max P. Brannon, the Undersecretary of Finance, he was furnished with an informal memorandum based on the Department’s instruction No. 91 of March 27, 1935.9 It was pointed out that the United States offered concessions covering over 99% of its importations from El Salvador; and he was assured that any additional requests made by the Government of El Salvador will be given careful and sympathetic consideration by the Department. In this connection, it is believed that the Government of El Salvador is considering asking, not a special increase in its sugar quota as previously reported; but a special preferential tariff-rate concession on sugar. Should it do so, its request will be forwarded to the Department, although it would appear to involve a concession to a country which at present supplies the United States with no sugar; and one which would have to be generalized to all other sugar producing nations.
The assurances requested, in connection with Schedule I, by the Government of the United States, have been discussed most informally with Doctor Brannon, who indicated that the desired guarantees relative to the charges for the analysis and registration of patent medicines had been referred to the Commission of Chemistry and Pharmacy for study. It is thought that there will be opposition from this agency.
Doctor Brannon was also asked if he had considered the general provisions suggested by the Department. He replied that he had read them, but had not studied them, and that from his cursory examination, it was impossible for him to make any statement concerning them. It is apparent, however, that no insuperable difficulties presented themselves to him on first reading.
In the meantime, the tentative Schedule I, forwarded to the Department with the despatch first referred to, has been referred to the Comisión Financiera, for study. This means that the whole trade agreements program will have to be explained once more to three new individuals. The Legation has, with Doctor Brannon’s knowledge, offered its services in this connection; but the Commission has not as yet expressed its readiness to avail itself of this offer.
The Legation is not entirely satisfied with the results obtained but it is felt that a definite step has been made towards removing the barriers to our trade with El Salvador, and that the Government now has a broader viewpoint, and one more in sympathy with the foreign trade policy of the United States, than it had at the beginning of the conversations. At times, the outlook has been discouraging, and it seemed that no further concessions could be obtained, but slow and [Page 563] patient negotiations appear to have met with a certain amount of success.
The Legation will continue to press for early consideration of the remaining factors.
Respectfully yours,
- Not printed.↩
- Not printed.↩
- William P. Cochran, Jr., Third Secretary of Legation.↩
- Foreign Relations, 1935, vol. iv, p. 539.↩