740.32112A/3–145: Airgram

The Secretary of State to the Chargé in Brazil ( Daniels )

A–287. Reference your airgram A–318 of March 1, 1945,95 presenting certain objections to the reduction of the Confidential List96 for Brazil.

In connection with the proposed reduction of the Confidential List, the following points should be considered:

1.
Your despatch no. 196 of February 12, 1945,95 indicates that the cloaking problem in Brazil is not believed to be one of major proportions, now that the spearhead enemy concerns have been or are in the process of being nationalized or liquidated.
2.
Brazil has demonstrated by its effective local controls program that it is alert in economic warfare matters, thereby rendering unnecessary the continued inclusion of many names now on the Confidential List.
3.
The Department believes that it is important to coordinate the Confidential List and the British Black List as far as possible in order that American exporters shall not be unnecessarily placed at a disadvantage in respect to United Kingdom exporters. The coordination of the Confidential List and the British Black List will be difficult even with a reduced list, but it would be virtually impossible if the list is not reduced.
4.
The Confidential List is a list designed to prevent American goods from reaching the hands of Proclaimed List concerns and the Department does not perceive how reduction of the Confidential List for Brazil runs counter to the Safehaven project.97
5.
The Embassy believes the list in its present form is a valuable instrumentality for the identification of undesirable representatives of American business. If a firm is sufficiently undesirable to warrant inclusion in the Proclaimed List, the Embassy should not hesitate to recommend such action. Any actual cloaks for Proclaimed List firms should be recommended for inclusion in the Confidential List. However, at this stage of the war and in view of Brazil’s cooperation, the Department believes that classification of Brazilian firms in twilight zones of undesirability should be avoided. While the Department has no intention or desire to relax its vigilance with respect to economic warfare, it considers desirable the revision or elimination of any procedure which tends to place unnecessary obstacles in the way of normal commercial transactions.
6.
The Department has received replies from the Missions in most of the other American Republics and they uniformly agree to the proposed reduction of the list.
7.
Administrative difficulties would arise if the Confidential List for all of the other American Republics were reduced but no reduction were made in the list for Brazil.

In view of the foregoing, the Department does not feel justified in making an exception in the case of Brazil. The Department has commenced the preparation of the revised Confidential List for the Western Hemisphere and you are urgently requested to report immediately whether on the basis of the revised criteria for inclusion in the Confidential List set forth in instruction no. 6827 of February 6, 1945,98 any names should be added to or deleted from the list of names enclosed with that instruction.

Stettinius
  1. Not printed.
  2. The Confidential List included persons and firms acting as cloaks for persons or firms on the Proclaimed List, or recommended for listing but not included on the Proclaimed List for various reasons.
  3. Not printed.
  4. The Safehaven program was a combined effort of the Departments of State and Treasury and the Foreign Economic Administration to forestall German attempts to hide assets outside of Germany thereby laying economic bases for future aggression. For documentation on this program, see vol. ii, pp. 852 ff.
  5. Not printed.