710 Consultation 4/8–147: Circular airgram
The Secretary of State to the Diplomatic Representatives in the American Republics
At Governing Board PAU July 28, Cuban Ambassador presented motion member Governments be consulted on inclusion clause Rio defense treaty that Section 202(e) Sugar Act 194853 would be considered as threat within meaning of treaty. In public session threatened Cuban non-participation Rio Conference if consultation not made. Motion rejected but minutes contain statement that “the Delegate of Cuba on the Governing Board of the Pan American Union states, so that the delegates may bring it to the knowledge of their respective Governments, that it deems it to be indispensable that, at the Conference of Rio de Janeiro, there be included a clause taking into consideration measures of an economic nature which, on being put into effect unilaterally by any American country, would constitute a threat to the economic stability of another American country or countries.”
If question raised you are authorized to make the following statement to appropriate officials:
- 1.
- Section 202(e) of the Sugar Act of 1948, when signed, will provide that the Secretary of Agriculture shall have authority to withhold or withdraw any increase in the quota provided for by the new Act as compared to the Sugar Act of 1937, if the Secretary of State finds that any foreign country denies fair and equitable treatment to the nationals of the United States, its commerce, navigation or industry.
- 2.
- This section does not constitute an economic threat to any country. It provides only for the right to withdraw the increase in the quota allowed under the Act if any country denies fair and equitable treatment to American citizens or enterprises. It does not apply to basic quotas.
- 3.
- It is permissive and not mandatory; it applies to all foreign countries and not to any country in particular. It represents no change in the economic policy of this country toward other countries in this Hemisphere. The section has ample precedent in the legislation of the United States.
- 4.
- The matter of claims in connection with this section has been greatly over-emphasized. This Government is, as it always has been, ready to submit claims of its citizens against foreign countries to [Page 31] international arbitration or adjudication. No country which is similarly prepared to submit claims to arbitration or judicial processes need ever expect that this section will be brought into operation with respect to such matters.