811.20 Defense (M) Chile/621: Telegram
The Secretary of State to the Ambassador in Chile (Bowers)
58. I have received and studied your Telegram No. 78, January 12, 7 p.m., with further reference to the cancellation of the United States-Chilean copper control agreement.
You say Chile has withstood Argentine copper demands on the basis of her agreement with the United States, and, owing to the fact that upon the termination of the agreement Chile were to refuse to sell to Argentina, serious controversy would result. You inquire whether some formula can be found through which Chile, because of agreement with the United States, can refuse to sell to Argentina.
The Department’s Telegram No. 34 of January 11, 7 p.m., made it clear that it would strike a most discordant note at this time of stress in respect of relations between Argentina and the other American republics (accompanied by the Bolivian crisis) if Chile were to furnish Argentina with amounts of copper other than that essential for public health and safety, and the Department’s Telegram No. 1124a spoke of permitting the free export from Chile of fabricated copper to “all of the other American republics except Argentina”. The Department would much prefer to see the agreement terminated in respect of all countries which have broken relations with or declared war on the Axis but that it be kept operative in so far as other countries are concerned. This would, of course, leave the agreement operative in so far as Argentina is concerned and should provide precisely [Page 721] the formula you seek. However, if out and out termination on the aforedescribed basis be not feasible it would be satisfactory for the time being if you could agree with the Chilean Government to leave the agreement ostensibly on the books with the understanding that it would be fully relaxed in respect of other countries in this hemisphere except Argentina. Perhaps you could in discussion with Fernández arrive at some other more acceptable formula which would achieve the objective of enabling Chile to sell more manufactured copper and at the same time not prompt the flow to Argentina of additional supply.
The Department appreciates the delicate position in which Chile finds itself in this matter, but feels that the recent replies to the Committee for Political Defense at Montevideo25 (and other consultation on the subject of Argentina and Bolivia) have made abundantly clear the position of the nations of this hemisphere on Argentine pressure methods. Were each country to yield when there is risk of specific difference with Argentina, the preservation of unity of purpose or the achievement of concerted action would be rendered most difficult.
Please see the Foreign Minister as soon as possible and explore the situation with him, making it clear that what we seek is a formula which will enable Chile to meet any complaints which may arise from Argentina but which will at the same time attain our broader aims.
I am relying on you in this matter and shall appreciate your telegraphing me when and how the agreement may either be terminated or rendered inoperative except for Argentina.