Foreign Relations of the United States, 1955–1957, Foreign Economic Policy; Foreign Information Program, Volume IX

89. Memorandum of a Conversation, Department of State, Washington, May 24, 1957¹

Washington, May 24, 1957

SUBJECT

• Proposed Measures Affecting Lead and Zinc

PARTICIPANTS

• His Excellency Senor Don Manuel Tello, Ambassador of Mexico
• Senor Don Vicente Sanchez Gavito, Minister Counselor, Embassy of Mexico
• Mr. R.R. Rubottom, Jr., Acting Assistant Secretary
• Mr. William A. Wieland, Director, Office of Middle American Affairs
• Mr. Louis F. Blanchard, Acting Officer in Charge, Mexican Affairs

The Ambassador referred to recent press notices indicating that the United States Government proposes to take some measures which will restrict imports of lead and zinc. Recognizing that the matter is internal, he nevertheless emphasized the adverse international results of such a move, citing references made by President Eisenhower to the international aspects in 1954, when attempts were made to raise import duties on these two metals.² As a result of the President’s interest on that occasion a stockpiling program was initiated which saved the situation. Mexico has since cooperated with the Administration’s recommendation to limit exports voluntarily. Should duties now be increased or quotas established Mexico would find itself at a distinct disadvantage with respect to other countries that had failed to refrain from taking advantage of the measures adopted in 1954. Taken together, monthly average exports of Mexican lead and zinc amounted in 1953 to 28.9 thousand tons, as against 24.³ thousand in 1956.

Ambassador Tello mentioned the importance of lead and zinc to Mexico as two of the five most valuable factors in its foreign commerce. Contrasting the $831 million imports from the United States with United States purchases in Mexico of only $404 million in 1956, he cited cotton policies already adopted by the United States which resulted in losses for Mexico of some $96 million.

Commenting on the continued applicability of President Eisenhower’s statement in 19543 that restrictions on importations of lead and zinc would be of doubtful benefit to the United States mining industry, he recalled that there were United States smelting concerns which depended exclusively on Mexican imports.

Mr. Rubottom explained that the steps now being considered derive from public statements made by the President promising to devise a long-term minerals program, and also from strong domestic political pressures, especially the western minerals producing States, calling for relief. The stockpiling program has resulted in glutting the market to the point where domestic producers are in need of relief and this program has also been very costly. While Mr. Rubottom himself has vigorously for some time past given full expression to the various international factors involved, it is nevertheless a fact that some defensive measures are going to be taken. Just what shape these measures will assume is not yet known. Referring to the marginal producers who would benefit from corrective steps, he pointed out that other countries also had marginal producers who were benefiting from the stockpiling program. Referring to decreases in imports cited by the Ambassador, he noted information in his possession showing increases in the value of lead and zinc imports by value since 1953; and with respect to cotton, he cited United States estimates of Mexico’s losses as not exceeding some $12 million. He assured the Ambassador that despite the Department’s sympathetic view of the problems to be created for other producing countries, he was unable to make any hopeful statement regarding the outcome of the consideration now being given to a difficult domestic situation.

Mr. Tello repeated his assurance that Mexican producers had not taken undue advantage of the stockpiling program, as established by his figures, and asked that this be taken into account along with Mexico’s continuing deficit in foreign trade, and the fact that two very important exports will be affected, to say nothing of curtailment of subsidiary production of gold and silver. His immediate interest, however, is to ascertain just what measures will be taken, either increase in duties or establishment of quotas, or a combination of the two, in order that his Government may be informed as soon as possible. It will be necessary for him to have appropriate information along these lines in order to prepare adequate statements in support of his Government’s interests. Note No. 2745⁴ was left with Mr. Rubottom with this end in view. Mr. Rubottom assured him that this information would be made known to him as soon as it is available.

1. Source: Department of State, Central Files, 411.004/5–2457. Drafted by Rubottom.
2. Regarding this issue, see memoranda by Dulles and Holland, Foreign Relations, 1952–1954, vol. I, Part 1, pp. 201 and 205.
3. On August 20, 1954, President Eisenhower wrote identical letters to the chairmen of the Senate Finance and the House Ways and Means Committees explaining why he had decided not to raise the duties on lead and zinc; for text, see Department of State Bulletin, September 6, 1954, p. 339.
4. Not found in Department of State files.