835.00/1556
The Secretary of State to the Ambassador in Argentina (Armour)
The Secretary of State refers to the Department’s telegram no. 889 of June 18, 1943. It is hoped that it may be possible at this time to [Page 426] call to the attention of the Argentine Government the kind of collaboration which this Government trusts will be forthcoming in connection with the implementation of the Resolutions adopted at the Inter-American Conference on Systems of Economic and Financial Control held in Washington.
Implementation of these Resolutions would involve, in addition to adequate enforcement of existing Argentine controls, basic economic and financial controls looking toward:
1. Prevention of all trade, financial transactions, and communications between Argentina and Axis, or Axis-dominated, territory. At present Argentine trade with Axis territory is restricted, not by Argentine controls but by the United Nations blockade. Similarly, there is no prohibition against communications with Axis territory. The remittances to the Dresdener Bank in January of this year are illustrative of Argentine financial transactions which benefit the Axis.
2. The prevention of trade and financial transactions between Argentina and neutral countries which might benefit the Axis. Appropriate controls should be directed at achieving the following objectives: (a) that goods exported to neutral territory shall not be re-exported to Axis or Axis-dominated territory; (b) that goods so exported shall not release equivalent goods for export to the Axis; and (c) that goods so exported shall not especially benefit that segment of the neutral country’s economy which is being used for the benefit of the Axis war effort.
Controls should be established as well to assure that imports from neutral countries are not of Axis origin, and that no advantage to the Axis accrues from the transaction.
In this connection, all transactions with persons in neutral countries who have aided or are aiding the Axis should be prohibited. This Government would be willing to make available to the Government of Argentina such information as it has relative to such persons and firms.
3. Application of economic and financial controls to the property and transactions of persons within Argentina known to be, or to have been, engaged in activities inimical to the security of this hemisphere. Since such persons or firms may have acquired Argentine citizenship or corporate nationality, the controls adopted should be applied irrespective of citizenship, nationality, residence, or domicile.
Measures necessary to achieve adequate controls would include: (a) adoption of flexible standards for identification of the persons or firms to be brought under control; (b) provision for liquidation, expropriation, or forced sale to acceptable purchasers of enterprises owned or controlled by Axis nationals, or persons friendly to the Axis, with effective blocking of any proceeds; (c) census of assets owned by the person or firms falling within the language of the controls, with emphasis on the discovery of assets beneficially owned by such persons or firms held in the names of other persons; (d) complete blocking of all assets with such safeguards as may be necessary to prevent any benefit accruing to blocked persons or firms from any dealings relative to the frozen assets; (e) elimination of persons deemed dangerous from the point of view of hemispheric security, from positions which might afford opportunities for sabotage, espionage, [Page 427] etc.: (f) establishment of a flexible system of interventorships; (g) appropriate differentiation, particularly in publications, between legitimate expression of opinion and subsidized pro-Axis propaganda; (h) adoption of administrative machinery for direct and effective application of controls.
4. Denial of Argentine facilities to the sale in Argentina, or any movement in the Argentine market, of any securities in which there may be an Axis interest, or as to which there is a probability that at any time since the beginning of the war they were transferred from previous owners by methods of disposition practiced by the Axis Governments. The latter would be, of course, an implementation of Argentina’s adherence to the Inter-Allied Declaration on Acts of Dispossession.22
Officers of the Embassy may wish to incorporate the substance of the above into a memorandum for submission to the Argentine Government, or to use it as a basis for conversations with members of the Argentine Foreign Office.
- On January 5, 1943, the Allied Powers issued a warning of their intent to defeat enemy methods of property dispossession; for text, see Department of State Bulletin, January 9, 1943, p. 21.↩