Evening star., 1940-01-22
Pressure Of Allies
On Argentina Factor
In i. ). Pact Failure
Domestic Interests Here
Also Are Blamed for
Negotiation Breakdown
BY CARLOS J. vIDELA.

BY CARLOS J. VIDELA.
NEW YORK. Jan. 20 N.ANAO.-
The breakdown in reciprocal trade
negotiations with Argentina and
Uruguay, marked by an official COM
munique issued by the Argentine
government week ago and coming
at time when renewal of the Trade
Agreements Act is the subject of
congressional controversy in WASH
ington, hides, behind the smoke
screen of tariff concessions, the two
real issues in this matter: Local.
interest pressure in this country and
initiation by Britain and France of
what amounts to barter trade on the
German model.
Argentina broke off negotiations
with the United States for a trade
agreement on the excuse of failure
by Washington to grant certain
tariff concessions, while the peren-
nial question of ratification by
the United States Senate of the
sanitary convention permitting the
entry of Argentine meat continued
to underline the issue. But behind
these exterior facts turks a more
solid reason: Britain and France,
by virtue of their acting jointly in
the matter of foreign purchases,
definitely do not want the money she
pays Argentina for meat and grain
to finance the South American coun-
try's purchases in the United States.
For long time, even before the
signing of the Roca-Runciman
agreement in London between Ar
gentina and Britain several years
ago. the British have been applying
pressure on their South American
meat suppliers to buy from those
who buy from u.s." Argentina sells
lot more in England than she buys
there, while usually she purchases
in the United States a lot more than
she sells there.
Franc and Pound Blocked.
With the coming of the current
war the allies have reached an ac-
cord with Argentina whereby, in
effect, all the money the latter
country receives from them in pay
ment of their war orders can be
spent only in Britain or France. In
other words, the blocked pound"
or blocked franc" system is now in
operation in practically the same
manner that the German "aski"
mark system was before.
Not only in what concerned tariffs
did the Argentines' displeasure at
thSr business with the United
States show itself. 1t found
more effective way of blocking pur-
chases in this country, by means of
a system of exchange control per-
mits, compulsory for importers. For
eign exchange was allocated to local
firms in Buenos Aires in such
manner that it effectively precluded
large purchases here
Coupled with that were two rates
OF dollar eXchange-one, official,
was applied with extreme parsimony
to permits; the other, free" or
black bourse, was available in the
general market at considerably
higher figures.
The whole theory behind the "buy
from those who buy from us" policy
and the foreign exchange trick has
been severely criticized by out
standing Argen tine economists and
newspapers as thoroughly unsound.
equivocal and pernicious. The
Buenos Aires daily, La Prensa,
which is the foremost newspaper in
the Spanish-speaking world, has
carried on a steady campaign
against the methods used by the Ar
gertine government in this connec-
ton.
1--WE cannot applaud" La Prensa
said shortly before the breakdown
of negotiations, "the procedure our
government seems to have chosen.
The proper way Is through diplo-
matte conversations and not that of
undeclared hostilities, disguised be-
hind rules that give free rein to
arbitrariness and serve only to
hinder commerce"
And Carlos Alberto Pueyrredon,
one of Argentina's leading econo-
mists, who said once that the United
States conjugates the verb to buy
like this: Il sell, you buy, he buys, >
proposed as simple solution that
Argentine meat not to exceed 35 per
cent of the internal consumption of
this country. He also criticized the
exchange control scheme adopted in
Buenos Aires.
In this country, at the same time,
strong pressure has been brought to
bear upon the Senate by cattle in
terests in order to prevent rati-
fication of the sanitary convention
with Argentina, which would allow
importation of meat from that
Nation. Industrial groups, on the
other hand, strongly favor ratiflca-
ton. The National Foreign Trade
Council says that imports of meat
products from Argentina would
stimulate trade between the United
States and Argentina and would in
consequence bring direct benefits to
American interests engaged in ex-
port trade and, indirectly, to all
American industries, including the
livestock industry"
1t is apparent, then, that the real
reason for the breakdown of nego-
tiations with Argentina and Uru-
quay (the latter country's problem
is essentially the same) is not the
matter of tariff concessions, i'm
portant as this is, but, on one hand
the differences between agricultural
and manufacturing interests here
and, on the other hand, the un.
relenting pressure of London or
Argentina, which has been called
a1pyi+oin,e otbor dominion "