Foreign Relations of the United States, 1949, The United Nations; The Western Hemisphere, Volume II

832.001 Dutra, Gaspar/5–1849

Memorandum by the Acting Secretary of State to President Truman

secret

[Washington,] May 18, 1949.

Memorandum for the President

Subject: Possible Topics for Discussion with President Eurico Gaspar Dutra of Brazil¹

The Department has received no information from the Brazilian Government or the Brazilian Ambassador² that President Dutra has any intention of discussing personally either political or economic subjects during his visit to this country. On the contrary, it has been repeatedly emphasized by the Brazilians that this is an official courtesy return visit in repayment of President Truman’s visit to Brazil in 1947.³

1. There are no political problems of any consequence between the two countries that require discussion at this time. It is vaguely possible that President Dutra may raise the point of Brazil’s need of armaments. This matter is, of course, directly related to the Hemisphere Defense Pact, and it is recommended that, if this subject should be discussed, President Dutra be reassured of our recognition of Brazil as our twice-proven ally and our intention of cooperating with her in every way within the limits of our capabilities.

2. Brazil has taken an active part in the International Refugee Organization but has not yet become a ratifying power. Brazil has not yet fully developed these plans, largely because of budgetary limitations. At the time of the Bogotá Conference,⁴ the Brazilian Foreign Minister seemed to be under the impression that Brazil had a definite commitment from this Government for a loan of $50,000,000 which would be utilized for the implementation of the Brazilian IRO program. This impression was entirely erroneous. It is suggested that this matter of the implementation of the IRO and Brazil’s participation be played down as much as possible in case the question is raised by the Brazilians. If we actively encourage Brazil’s more active participation in the plan, it almost inevitably will be followed by a renewal of suggestions regarding a sizable loan on a government-to-government basis.

3. There are several economic subjects which may be touched on by President Dutra in a very general way. He is likely to extend the appreciation of his Government for the services extended by North American experts in the preparation of a joint technical report on the economic development possibilities of Brazil. The position of this country is that we were happy for an opportunity to afford this collaboration and that we are hopeful that the report will constitute a framework for the further development of Brazil.

4. It is also possible that there may be mentioned the desirability of negotiating between the two countries (1) an economic development and investment treaty, and (2) a tax treaty pointing towards the elimination of double taxation. President Dutra can be assured that both of these matters are of interest to us and that this Government stands ready to open negotiations at any time.

5. It is not expected that the petroleum problem in Brazil will be brought up. Briefly, Brazil has promising petroleum possibilities but, due to a pressure campaign carried forward by Communists and extreme Nationalists, a petroleum law which would permit the entry into the country of exploration companies has not yet been passed by the Congress. The Brazilian President can be told that we believe that the development of petroleum possibilities in Brazil would be of very great assistance to the economy of the country. It might also be mentioned that no inter-government loans for a purpose of this type are contemplated in view of the fact that there is abundant private capital and technical know-how ready to enter Brazil if and when a proper petroleum law has been passed by the Brazilian Congress.

There is attached hereto a duplicate set of biographic material on the members of the official Brazilian party,⁵ the originals of which were forwarded on May 12. There is also attached a proposed press release for Friday, May 20, covering these conversations between the two Presidents.⁶

James E. Webb

1. President Dutra visited the United States, May 18–27, 1949.
2. Mauricio Nabuco.
3. Concerning President Truman’s visit to Brazil to attend the closing meeting of the Inter-American Conference for the Maintenance of Peace and Security, see Foreign Relations, 1947, vol. viii, pp. 1 ff.
4. For documentation on the Ninth International Conference of American States, held at Bogotá, Colombia, March 30–May 2, 1948, see Foreign Relations, 1948, vol. ix, pp. 1 ff.
5. Not printed.
6. See footnote 1 to the memorandum of conversation by Mr. Clark, supra.