811.20 Defense (M) Spain/1191: Telegram
The Ambassador in Spain (Hayes) to the Secretary of State
[Received November 23—1:05 p.m.]
3449. Before presenting the memo contained in my 3398, November 18, 7 p.m., I ascertained that British Embassy had not received instructions to support my request. However, it agreed to do so in general terms although it has made no representations in the matter since I submitted my memo. Furthermore in absence of instructions in the matter the British Embassy is unwilling to specify a quid pro quo. It perceives no serious objection to suppression of overcharges on goods originating in British Isles (we understand only product in this category is copper sulphate) but is reluctant to recommend suppression of overcharges on goods originating in Empire or Colonial areas.
British Embassy furthermore does not favor interrupting proposed large purchases of seasonal goods such as oranges. These, of course, must be purchased promptly if they are to be purchased at all. Ellis-Rees91 was informed by Ministry of Food that goods are needed for supply reasons and British have already contracted for onions, bitter [Page 659] oranges and lemons, leaving some 110,000 tons of sweet oranges yet to be negotiated for.
Aside from purely seasonal aspect, which is of immediate importance, Spain is normally important source of British food supplies and British Embassy is reluctant to take action which might threaten that trade and they hesitate to risk it by endeavoring to use it as a weapon in seeking wolfram embargo.
In other words, we understand British here consider there are two obvious difficulties: (1) Timing of effort to obtain wolfram embargo is bad since seasonal purchases of foodstuffs from this year’s crop, which are being made at insistence of Ministry of Food, must be made now or not at all, (2) retention of Spain as a source of food and other supplies entering into British traditional trade is an objective comparable in importance in eyes of British Embassy to proposed wolfram embargo. British hesitate to risk first objective in seeking second.
My own view is that British attach insufficient weight to: (1) Spain’s urgent need to sell surplus orange crop; (2) value to Spain of selling crop to British and thus increasing its ability to purchase wide range of products available in sterling area.
In contrast to the British position we do not require any products which Spain traditionally supplies to us and therefore the maintenance of our traditional purchases in Spain is not an objective in itself. Furthermore since our normal purchases average less than 10% of Spain’s exports while British purchases average nearly 25%, our traditional trade is not as important as a source of Spanish purchasing power and therefore is not as substantial a weapon as is British traditional trade in our effort to obtain a wolfram embargo.
On the other hand our ability to supply, and Spain’s dependence upon us for many of its most essential requirements give to us a more potent withholding weapon than the British possess. Of Spanish total imports we normally supplied 16-plus percent whereas the United Kingdom supplies only 10%. In addition we now control petroleum supplies.
It is obvious that by forging together into a single weapon British traditional purchases and American supplies our chances for obtaining the desired wolfram embargo would be much better than if we rely solely upon the American supply and purchase capacity.
In order to overcome any possibility of objections of the British on the ground of immediate needs, it might be helpful if we could assure them of supplies of oranges in the event the wolfram negotiations are so long delayed that the British may miss the opportunity of acquiring the incoming crop.
- Hugh Ellis-Rees, Financial Adviser of the British Embassy in Spain.↩