Office of the Historian

811.20 Defense (M) Bolivia/872: Telegram

The Ambassador in Bolivia (Boal) to the Secretary of State

La Paz, March 13, 1943—noon.
[Received 5:55 p.m.]

487. For Rubber Development from Lepper.62 In note dated March 3,63 but received by us yesterday, Bolivian Government taking [Page 556] advantage of what they claim is doubtful wording of our Rubber Agreement64 and wishing to profit by tempting Argentine offers for production of exempted regions proposed the following amendments to the Agreement.

(1)
Inclusion therein of Velasco triangle.
(2)
Definite exclusion of Larecaja and Caupolicán to full extent of potential production (we fear in addition smuggling from adjacent regions).
(3)
Until above production reaches 250 tons Rubber Development to make up difference for export to neighboring countries (Bolivian Government cynically admit they are committed for exports greater than quantity provided in Agreement).
(4)
Five hundred dollar deduction from development fund to be limited to first year and remainder to be spent only in Departments of Beni, Pando and Santa Cruz.
(5)
We to provide at cost price through Banco Agricola tools, equipment, and supplies necessary to intensify this unlimited production for shipment to Argentina.

In the same note they claim “It has not been possible to ascertain either the capacity or the cost of production in those provinces since no production has been taken from that source”. However, we are purchasing rubber from there and are certain that the Government, specially person of the Minister of Public Works (the chief landowner in the region), has made no effort to determine costs but has procrastinated for months while dealing in his name and that of the Government with various Argentine interests including the Government of that country (see La Paz report on March 965 and Embassy’s airgram 198, March 1266). The fact that Bolivian Government has disregarded Hall’s67 observation made to the Cabinet February 22 that agreement limited all exceptions to 250 tons by continuing negotiations with Argentina to the point of lacking only signatures makes us believe they have in mind voiding the Agreement should we not meet their terms. Shall cable suggestions for legalizing Agreement. Full text and our observations and recommendations regarding note cited follow in separate communication. [Lepper.]

Boal
  1. Richard C. Lepper, representative of the Rubber Development Corporation.↩
  2. Not printed.↩
  3. For text of agreement signed July 15, 1942, and exchange of notes signed on the same day, see Foreign Relations, 1942, vol. v, pp. 574–580.↩
  4. Not found in Department files.↩
  5. Not printed.↩
  6. Carlos Hall, representative of the Rubber Development Corporation.↩