Evening star., 1940-12-01
Better u. S.>Argentine Alliance
Held Hemisphere Defense Key
German.Italian Prestige Suffers When Nazis Fail
to Make Good on Contracts to Deliver
Supplies in October
By Joseph S. Edserton.
By Joseph S. Edeerfon.

Upon the immediate Improvement of
relations between the United States and
its key South American neighbor, Argen-
tina, may depend much Of the future
success Of Pan-American cooperative
efforts and the soundness Of hemisphere
defense.
Signs Of q failing totaNtarian prestige
In Argentina, on the heels of recent
German-Italian reverses, have tended to
create conditions regarded as more ia
vorable than ever before for real work.
ing alliance between the United States
and Argentina, the most widely sepa-
rated and the most powerful of the
American nations, in the opinion of stu
dents of Pan-Americanism.
Since early last summer, when Nazi
influence in Argentina probably was at
its peak and United States influence
was at a correspondingly low ebb, there
has been q continuous shift toward the
reverse Of these positions, which recent
Developments have tended to accelerate
greatly.
German prestige in Argentina is said
to be lower today than at any time since
the rise Of the Hitler star. Last August,
with France crushed and Britain facing
alone the might Of German arms. Ger
man leaders In South America, particu-
larly in Northern Argentina, Uruguay
and Southern Brazil, were confident of
important local support for any Nazi
campaign Berlin might have ordered.
German Boasts Recalled.
1t is recalled that Germany boasted
more loudly in Argentina and Brazil than
anywhere else outside of Europe of its
early successes and had based consider
able trade and economic plans there on
basis Of a conquest of England In
August. South American governments
and commercial firms last June and
July were negotiating contracts with
Germany for machinery and goods under
a widely propagandized cash bond guar
antee of delivery in October. Not only
have no deliveries been made in accord
ance with these contracts. but 1t has been
found now that the bonds are not good
for cash but only for book credits, in
reichsmarks, according to reports re-
ceived here.
But, although German prestige has
suffered. the way for improved United
States-Argentine relationships has not
been made especially easy. Last Septem-
Der, Federico Pinedo, finance minister in
the Argentine cabinet, announced a
temporary suspension of all applications
for outgoing United States dollar
exchange permits. This amounted to an
embargo on importation Of United States
products. The only explanation was that
time was required for a study of the
dollar situation, which had become seri-
Gus for Argentina because of the stop
page Of her exports to Europe and be-
cause Of the cutting OF by Great Britain
Of sterling exports. To pay for United
States machinery and supplies. Argen-
tina was draining herself of gold re-
serves.
The temporary suspension lasted less
than q month. At the time it was lifted
1t was announced in Washington that
the two countries were negotiating for a
reciprocal agreement on foreign ex-
change and that the United States Ex-
port Import Bank had been granted
$500, 900 900 additional lending capital to
assist South American countries in
building up home industries and defense
armaments.
Development Firm Formed.
Recently, according to the Associated
Press, United States businessmen in Ar
gentina initiated plans for formation Of
an Argentina development corporation"
to push sales of Argentine products in
the United States. The tentative setup
called for capitalization of at least $780,
600. The object was to increase ex-
portation to the United States of goods
which would not compete with United
States products; its motivation was the
edict of Finance Minister Pinedo that If
the United States wanted more dollar
exchange for United States exports to
Argentina 1t would have to produce such
exchange by purchasing more Argentine
products.
One of the recent developments in Ar
gentine- United States relationship is the
current visit to Washington of the Ar
gentine Economic Mission, headed by DR..