824.2544/3–553: Telegram
The Secretary of State to the Embassy in Bolivia 1
223. Reurtel 2662 developing situation has made it impossible grant further delay and Department has today formally advised Bolivian Ambassador that RFC no longer interested discussing one-year tin contract and that letter3 from RFC conveying this notice in writing will be [Page 523] given him within few days. Dept suggested news be kept confidential at least for time being and Amb stated his personal view this desirable. You should discuss this development with Bolivian authorities along following lines:
Bolivian Government will recall that in September 1952 US advised offer of term tin contract could not be held open very long. In January 1953 Bolivian Government was given detailed information about US tin supply position, was informed that term contract offer might have to be withdrawn at any time without advance notice, and was urged to act without delay to establish conditions which would make negotiation term contract possible. Department also pointed out on January 9 that spot purchase might reduce US ability enter term contract. RFC position was stated clearly to Bolivian Mining Corporation in letter of January 224 regarding spot contract. Since January continuing review US tin supply position has resulted in conclusion, announced publicly on February 6 by National Production Authority, that US now has under contract or available to private importers sufficient tin meet estimated requirements government and private industry. In this situation RFC’s present estimate is that if it were to contract for further tin it would be exceeding authority granted it by Congress, which is limited to procurement tin for US Government and American industry. US action of giving this notice is based exclusively on foregoing considerations and US deeply regrets this situation has developed prior to conclusion mutually satisfactory arrangements regarding compensation and contract problems. US continues have friendliest feelings Government and people Bolivia and will attempt respond in positive manner to any sound Bolivian initiative for closer cooperation.
If you are asked about possibility spot purchases you should reply no answer can be given in advance since RFC ability make spot purchases will depend on situation at time of offer including US supply position.
FYI. Possibility US Government reopening discussion term contract under developing supply situation extremely poor and any justification consideration would require not only definitive action on part of Bolivia regarding compensation problem but also evidence constructive effort insure sound operation mining industry. You may in your discretion use above bring home reality situation but make every effort avoid giving Bolivians grounds charge RFC action taken as reprisal failure reach agreement compensation problem.
- Drafted by Mr. Hudson, with the assistance of Mr. Atwood; cleared with Mr. Mann, Mr. Evans, and the Office of the Assistant Legal Adviser for Inter-American Affairs.↩
- Not printed (824.2544/3–553).↩
- Not found in Department of State files.↩
- Not found in Department of State files, but a portion of the referenced letter is quoted in Mr. McDonald’s letter to Mr. Mann, dated Mar. 9, 1953 (see footnote 2, supra).↩