800.85/595: Telegram

The Chargé in Colombia ( Keith ) to the Secretary of State

570. Reference to Department’s telegram 484. The Foreign Minister informed me this morning that Colombian Government had offered to Phyllis [?] the sum of 1,500,000 for the two tankers but this was not accepted as latter insists on price of $250 per ton for the Anteo and $200 per ton for the Rapallo. Subsequently no action has been taken and Turbay has received no instructions.

The Minister fears that if they take over the tankers on the basis of our offer Italy will claim the difference between our price and its own which will have to be settled by arbitration at the end of the war. He requested I “sound out” whether our Government would be ready to guarantee that, if as a result of arbitration following the war Italy were awarded a sum greater than that now offered, the United States Government would assume the responsibility of paying the difference. He said this would help him on presenting the matter again to the Council of Ministers. He remarked that it would be assuming a considerable risk to place the Government open to claims after the war for “15 minutes use of the two boats” (it is not possible to dissuade him from an apparent conviction that if Colombia takes the boats there will be a special effort made to sink them immediately).

He then told me Argentina, Chile and Uruguay were all interested in obtaining these ships and that he was convinced that Argentina would pay the amount Italy was demanding although he added that possibly the former would be able to obtain a rebate from Italy after that step were taken.

My reaction is that it is not actually a lack of the Minister’s desire to cooperate but rather an unwarranted caution to prevent the Government’s [Page 199] being caught for a large sum as a result of future arbitration. Following the presidential elections May 3 the solution here will probably best result from conversations with the President on this subject, with reminders being given to Turbay by the Department as to the urgency of the matter.

Keith