824.2544/12–3052

The Deputy Assistant Secretary of State for Inter-American Affairs ( Mann ) to the Administrator of the Reconstruction Finance Corporation ( McDonald )1

confidential

My Dear Mr. McDonald : I think it is worth while for me to confirm in writing the agreement that has been reached between the Department and the Reconstruction Finance Corporation in Mr. Atwood’s conversation with Mr. McKinnon on December 17 and in the meeting you held with Mr. Atwood, Mr. Evans and me on December 24.2

The enclosed memorandum to Mr. Bruce 3 sets forth the lines of the proposal to negotiate simultaneously with Bolivia a term tin contract and an agreement for the submission of American claims to impartial arbitration. This memorandum also outlines the basic reasons why the Department believes this solution is in the best interests of the United States. I am glad to confirm that Mr. Bruce has agreed to the procedure recommended in the memorandum and that the Department has already held one introductory meeting with the Bolivian Ambassador. We will, of course, keep the RFC informed of further developments and will notify you when it appears profitable for you to begin negotiations with the Bolivian Government concerning the details of the contract. In the meantime, I am sure you will agree that it is desirable that these discussions receive no publicity. I would suggest that both you and we limit our answers to any press inquiries to the substance of the statement made in the Department’s press release of December 19, a copy of which is enclosed.4

On June 17, 1952, the Department joined with other interested agencies of the Government in urging that all procurement agencies of the United States Government refrain from negotiating any term contracts for the purchase of minerals from the Bolivian Banco Minero until satisfactory assurances could be obtained from the Bolivian Government regarding existing contracts between Bolivian producers and United States Government agencies. The Bolivian Government has now given the United States formal assurances concerning these contracts, and the original purpose of this request no longer exists. We do suggest, however, that negotiations between the RFC and Bolivia be [Page 520] further postponed until we have obtained the Bolivian Government’s approval of the compensation agreement.5

Sincerely yours,

Thomas C. Mann
  1. Drafted by Mr. Evans.
  2. No memoranda of the referenced conversation and meeting were found in Department of State files.
  3. Not printed.
  4. Not printed. See footnote 3, supra.
  5. In a letter to Secretary Acheson, dated Jan. 6, 1953, acknowledging Mr. Mann’s letter, Mr. McDonald stated that negotiations for the purchase of tin concentrates from Bolivia would be postponed pending further advice from the Department of State, and also that RFC response to press inquiries would be limited to the “general tone” of the press release of Dec. 19 (824.2544/1–653).