833.5151/530
The Minister in Uruguay (Dawson) to the Secretary of State
[Received July 25.]
Sir: I have the honor to refer to my despatch No. 267 of July 9, 1938,68 reporting a press statement to the effect that at a Cabinet meeting the Minister of Finance had advised his colleagues concerning measures with a view to restricting the use of free exchange for financing imports.
There is enclosed a self-explanatory memorandum68 regarding a conversation had by Mr. Vitale69 of my staff with Sr. Fermin Silveira Zorzi of the Bank of the Republic. As will be observed, Sr. Silveira Zorzi told Mr. Vitale very confidentially that, while the Minister of Finance was in favor of radical measures to check the use of free exchange for imports, the Bank of the Republic had expressed the opinion that this would be inadvisable and that, in endeavoring to limit the use of free exchange and restrict imports to quota countries (i. e., countries granted a quota of controlled exchange), the Bank should be allowed to use its discretion.
It will be noted also that Sr. Silveira Zorzi stated that free exchange in the amount of 30,000 pounds had recently been granted to importers of American agricultural machinery and that the amount would probably be increased.
Respectfully yours,