Foreign Relations of the United States: Diplomatic Papers, 1945, The American Republics, Volume IX

Nat. Archives R.G. 353: SWNCC 4

The Subcommittee for Latin America to the State–War–Navy Coordinating Committee

[Washington,] February 15, 1945.

Lend-Lease to the other American republics was initiated at a time when the hemisphere was in imminent danger of attack by the Axis. Agreements were entered into with eighteen other American republics² (all except Argentina and Panama) authorizing the delivery of Lend-Lease material to a maximum amount of $425,890,000, and providing for financial settlements on terms varying from country to country. Under these agreements materials have been delivered to the other American republics for the purpose of hemisphere defense.

Efforts are being made to obtain complete and accurate information from the Foreign Economic Administration concerning the value of Lend-Lease requisitions approved by the various agencies for delivery to the other American republics. It has not been possible to obtain accurate data from all agencies. This report is based largely on information provided by the War and Navy Departments, covering the major part of the program.

The Army and Navy report that as of January, 1945, they have approved requisitions for Lend-Lease to the other American republics totalling approximately $270,278,000. An informal estimate by an officer of the Foreign Economic Administration indicates that approximately eight to ten million dollars worth of reqisitions for Lend-Lease to the other American republics have been approved by that agency in addition to the foregoing, but confirmation of this estimate has not been possible.

The Foreign Economic Administration reports, however, that the actual value of all Lend-Lease shipments billed to the other American republics as of November 30, 1944, is $224,808,571.02 for all agencies.

Additional materials have been made available to the other American republics through the lease of ships by the Navy and procurement on a cash reimbursement basis. The Navy has leased to the other American republics ships valued at $56,494,000, for the use of which only nominal payments are expected. Cash reimbursement requisitions approved by the Navy amount to $5,545,710, of which materials amounting to $2,244,895 have been invoiced. Neither the leased ships nor the materials purchased on a cash reimbursement basis involve charges of any consequence against the credit ceilings established in the individual country agreements.

Such figures as can now be obtained concerning Lend-Lease to the other American republics may therefore be summed up as follows:

Total authorized in Lend-Lease agreements	$425,890,000
Approved requisitions
Army		$213,990,354
Navy		56,288,201
		$270,278,555
Materials delivered and billed Nov. 30, 1944		224,808,571.02
Value of Navy Leased Ships	56,494,350
Procurement under Cash Reimbursements (Navy only)	5,545,710

Late in 1943 the greatly improved military situation led to a reconsideration by the Joint Chiefs of Staff of the Lend-Lease policy to the other American republics. The Joint Chiefs and the Department of State agreed upon the following statement of policy which should guide Lend-Lease to the other American republics from that time through the period ending June 30, 1945:

“In view of the necessity for concentrating all productive capabilities in backing up the United Nations’ offensive, procurement under Lend-Lease credit shall in the future be approved in general only for the following purposes, and within the period ending June 30, 1945:

• “a. The development and preparation of such ground, Naval and Air forces, with their supporting establishments and installations, as may be required for Joint operations with United Nations forces within this Hemisphere.
• “b. The training and equipping of such American Republic forces as may be employed in conjunction with forces of the United Nations in offensive operations overseas.
• “c. The repair and maintenance of existing equipment essential to the war effort where facilities do not exist for making repairs locally.
• “d. The shipment of limited amounts of certain armaments and material deemed essential to the successful carrying on of the programs in which United States military and naval missions are engaged.
• “e. The furnishing of munitions and equipment by type and in the quantities best designed to maintain internal security in those countries exporting vital strategic materials to the United Nations and whose governments continue to support the United States.

“Certain raw materials, semi-finished, and finished products, which are not procurable under the provisions set forth above may be furnished on a cash basis; provided that no material considered as arms, ammunition, and implements of war, as enumerated by Presidential Proclamation #2549, dated 9 April, 1942,³ shall, without previous approval of the State, War, and Navy Departments, be furnished (on a cash basis) to any American Republic except those mutually agreed upon by the three Departments.”

Lend-Lease has therefore been considerably curtailed to the other American republics except for Brazil and Mexico. Armed forces of those countries are now either actively engaged in military operations overseas or are training for such service,⁴ and therefore constitute a special category in the Lend-Lease program. Information on the Lend-Lease transfers for the Brazilian Expeditionary Force are not available. Staff conversations now being initiated between military and naval representatives of the United States and other American republics, will provide information to serve as the basis of any further provision of arms and materiel to other American Republics outside of overseas operations.

The table (1) which is attached hereto⁵ shows the present status of Army and Navy Lend-Lease to the other American republics.

The following information is provided in reply to the specific points mentioned in the memorandum of January 19, 1945, from the State, War and Navy Coordinating Committee.⁶

(A) The Current Program of Lend-Lease Supplies for the American Republics

Lend-Lease shipments to the other American Republics are being considerably curtailed pending the outcome of Military and Naval Staff conversations. Material now in process of consideration or transfer consists largely of items other than arms, ammunition and implements of war.

Most of the Army’s program for the other American republics, except for the Brazilian Expeditionary Force and the Mexican Fighter Squadron, has been completed. It is estimated (although official figures are not available) that approximately $17,000,000 worth of materials are included in Army requisitions approved for shipment by the Munitions Assignment Board but not yet invoiced. It is not possible without extended and costly research to determine what these materials consist of.

Requisitions for the other American republics from the Navy Department, approved by the Chief of Naval Operations but not yet invoiced, amount to $32,080,070. Details on what is covered by these requisitions are not available but the Navy’s program is concentrated on Brazil, Chile, and Peru, with which countries the Navy is engaged in joint operations.

Beyond these current programs both the Army and Navy have requests for Lend-Lease materials from the other American republics under consideration. The Army has now a request for maintenance equipment and tools for the Colombian Air Force. Brazilian requests under consideration by the Army include anti-aircraft finders and computators, communications equipment and barbette gun carriages. Other requests for the Army are of insignificant importance (again excepting the Brazilian Expeditionary Force and the Mexican Air Squadron) but additional requests may be expected in the future particularly following the completion of the staff conversations.

The Navy’s forward program, consisting of requests under consideration but not yet in the requisition state, is concerned primarily with facilities for joint operations with the Naval forces of other American republics. Requests received from Brazil involve equipment for a gun factory, some navy blimps and the transfer to the Brazilian Navy of excess materials and equipment to be turned over by the Commander of the 4th United States Fleet when that unit is withdrawn from the South Atlantic. Brazil is also, at its own expense and for cash, developing a torpedo plant and undertaking a program involving the construction and arming of destroyers. Requests from Chile involve equipment for a naval base and some airplanes. Ecuador has requested some patrol planes. Peru wants some equipment for a naval base. Uruguay has asked for training and reconnaissance planes and other minor items. All other aspects of the Navy’s forward program are unimportant in their effect on the Lend-Lease situation as a whole.

(B) The Interests of Each U.S. Government Agency Involved

The interests of the War and Navy Departments are expressed in the quotation from the Joint Chiefs of Staff document 629 [629/4] above. The interest of the State Department lies in facilitating the achievement of the purposes of that document, while at the same time helping to guide the Lend-Lease program in such a way as to avoid the stimulation of international rivalries or other political developments which would prejudice our good relations with the other American republics.

In a larger sense the interests of all three departments have been united in using Lend-Lease to achieve the fullest possible military, political and economic cooperation of the other American republics during the war. This cooperation has taken the form of making valuable operational facilities available to the United States armed forces, participation in the patrol of shipping lanes, suppression of subversive activities, declarations of war and rupture of diplomatic relations with the Axis, the extension of port and harbor facilities to United States naval vessels regardless of belligerency, and the expanded and uninterrupted flow of strategic materials to the United States and our allies. The Army and Navy concur in the statement that the value of the base at Natal, Brazil, to the war effort would alone be worth all the Lend-Lease material sent to the other American republics.

(C) Payments Made by the Latin American Countries and the Ability of the Countries to Repay on their Lend-Lease Agreements.

Lend-Lease Agreements with the other American Republics provide for repayments by each country of a certain portion of the value of materials and services extended to them. Because of the varying abilities of these countries to make such payments the agreements specify the percentage of the value of the total goods delivered to be repaid by each country. (Table 2 attached).⁷ Bills are rendered by the State Department in accordance with these calculations.

Payments received from the other American Republics to date are as follows:

Colombia	$1,922,000
Dominican Republic	442,000
El Salvador	120,000
Haiti	30,000
Honduras	30,000
Uruguay	3,900,000
Venezuela	900,000

The following countries have made no payments under their Lend-Lease agreements: Bolivia, Brazil, Chile, Costa Rica, Cuba, Ecuador, Mexico, Nicaragua, Paraguay, and Peru. Guatemala is credited with a repayment of $3,000,000 which is the estimated value of certain facilities made available to the United States.

(D) Political Factors Disturbed by Munitions Supply

Delivery of arms and munitions under Lend-Lease has affected the political situation in the other American republics in two major aspects: internal and international.

One of the original purposes of Lend-Lease to the other American republics was to support the stability of governments, the overthrow of which, particularly if effected by groups with pro-Axis connections, would react adversely to the war position of the United States. As the military threat to the American continents decreased, normal political activity in many countries increased, looking toward the replacement of existing administrations by opposition parties. In countries governed by dictators, severe criticism of the United States has been expressed by liberals because Lend-Lease arms, supplied by this country were being used to support the dictators and suppress democratic opposition. There are some grounds for this charge, but it must be recognized that occasionally Lend-Lease arms have also been used to overthrow existing regimes.

Internationally, the distribution of arms and munitions under Lend-Lease in the other American republics has worked upon long-standing fears and jealousies existing among various republics. Among most of the countries of the West Coast of South America, for example, there is considerable fear of each other, based upon the smouldering jealousies and resentments that go far back into their history and early wars. Keenly aware of every improvement in the armed forces of their neighbors, these countries become greatly concerned over each delivery of Lend-Lease materials to adjoining republics, and appeal to the United States for additional arms with which to meet the threat of the real or imagined increase in their neighbor’s fighting powers. Discrepancies in Lend-Lease deliveries to the various countries have generally not been as great as imagined or claimed, but even misinformation and misunderstandings have served to increase mutual suspicion among these countries. Similar sore spots exist in Central America, and between Haiti and the Dominican Republic, while Brazil’s large increase in armed forces has, of course, challenged Argentina to step up her military production and training.

In view of the differences in strategic location in relation to hemisphere defense and other aspects of the war, it has of course been impossible to give each country exactly the same amount of armament under Lend-Lease or keep the armed forces of each country on a par. Yet strong efforts to avoid unnecessary differences have been made, and it has been this Government’s policy to curtail deliveries of further arms and munitions, as reported above, partly because of the political consequences briefly mentioned herein.

(E) The Possibilities of Reverse Lend-Lease in Addition to Cash Repayments

It has consistently been the policy of the State Department that there be no reverse Lend-Lease with respect to the other American republics primarily because of the specific arrangements for cash repayment written into each agreement.

(F) Potential Allocations of Shipping Space

Information obtained by the Navy from the War Shipping Administration, indicates that more than one hundred times as much tonnage of strategic material is shipped to the United States than Lend-Lease material is transported to the American Republics. Shipping space is therefore not a problem of consequence.

(G) The Amount of Munitions and Goods Heretofore Delivered, the Amount in Transit and on Hand

It is not possible under existing systems of records to provide information on the value of goods in transit and on hand. Table 3⁹ gives the total amounts shipped and billed to each country as of November 30, 1944, the grand total of which is $224,808,571.02. Itemized information on the amounts of munitions and goods approved for each country by the Army and Navy are available in the large report prepared by the War and Navy Departments.

(H) Allocation Obligations and Expenditures Established for Such Supply as of December 31, 1944

Table 1⁹ gives this information.

There is attached for the study of the Committee a full and detailed report from the Army and Navy⁹ on all aspects of their Lend-Lease program in the other American republics. Of particular interest are the country programs which include information on the nature and amount of goods made available, as well as certain summaries of special categories, such as aircraft and naval vessels. The factual data contained in this report has been coordinated within the War and Navy Departments.

2. For lend-lease agreements, see index entries under the country headings in Foreign Relations, 1941, vols. vi and vii ; ibid., 1942, vols. v and vi ; ibid., 1943, vols. v and vi .
3. For text, see Department of State Bulletin, April 11, 1942, p. 323, or 56 Stat, (pt. 2) 1948.
4. For documentation concerning training and combat participation by Brazil and Mexico, see pp. 600 ff. and pp. 1109 ff., respectively.
5. Not printed.
6. The document referred to subsequently as SWNCC 4/1; not printed.
7. Not printed.
9. Not printed.
9. Not printed.
9. Not printed.