The Foreign Office by a Note No. 3229 of March 6, 1942, a copy and
translation of which are enclosed, has now made formal reply setting
forth its point of view relative to the type of engagement which it
deems appropriate for the procurement of the arms and ammunition. It may
be observed that the spirit and sense of the formal reply closely
approximates that of the preliminary response as contained in the
President’s oral statements and the Ministry’s Memorandum7 summarizing negotiations in the
matter.
No material technical difficulty should be encountered in supplying the
Guatemalan Government with the equipment it desires for its own
immediate military needs and for which it proposes to pay cash. The
matter of the larger amount of equipment which Guatemala needs for
cooperation with the United States Government in hemisphere defense
presents a much more difficult problem. It occurs to me that this phase
might possibly be solved by an arrangement whereby Guatemala would
secure the equipment under the normal terms of the Lend-Lease Act,
without any exceptions of principle in its favor which might be
considered as unfair departures by other American Republics, but at the
same time the contract to be so drawn as to afford in substance the end
sought by Guatemala. Concretely, it is suggested as a compromise that
perhaps Guatemala might be induced to make small installment payments
over the usual period of years, with the proviso that at the end of the
war the Guatemalan Government would be permitted, as it evidently
desires, to return to the United States such equipment as it has not
expended and which is in good condition. The value of the equipment so
returned would be credited against the obligation contracted by this
Republic under the Lend-Lease Act. If the amount of equipment returned
were to exceed the monetary balance due by Guatemala subsequent to
installments effected, the sum of the excess would be refunded to the
Guatemalan Treasury. If the equipment returned were not sufficient to
liquidate the monetary balance due, the Guatemalan Government would be
obligated to discharge the sum of the deficit. Such a proposal of course
presupposes, on the side of the United States, that the arrangement is
legally possible and within the policy adopted, and, on the Guatemalan
side, that the installment payments called for would be so spaced and in
such moderate amounts that the demands could be met by Guatemala within
its extraordinary budgetary resources and without resort to public
loans.
I do not know whether such a plan would be agreeable to the Guatemalan
authorities. Doubtless the Department may evolve a more satisfactory
arrangement, the present suggestion being advanced by me merely as one
solution which might merit exploration and without any attempt to pass
on the justice of Guatemalan pretensions. The ostensible value of the
plan, which the Legation ventures to submit for examination, is that the
United States would be assured of payments in keeping with the
provisions of the Lend-Lease Act and Guatemala would obtain acceptance
of its contention that it be not obliged to pay for arms and ammunition
over and above its immediate needs and which are not actually expended
by it.
[Enclosure—Translation]
The Guatemalan Ministry for
Foreign Affairs to the American
Legation
No. 3229
Memorandum
The Ministry for Foreign Affairs has the honor to refer to the
memorandum from the Legation of the United States dated February 20
last, relative to the matter of furnishing arms in accordance with
the lend-lease act.
The Ministry had delayed replying to the kind memorandum of the
Legation in order to make clear the status of pending negotiations.
The questions which arose having been elucidated, the Minister is
today able to make a clarifying and definitive reply with regard to
the decision of the Government of the Republic relative to the draft
contract submitted for its consideration.
The President of the Republic has taken up directly with His
Excellency the Minister of the United States the different phases of
the pending negotiations; and His Excellency the Minister is aware
of the good will of the Government of Guatemala to cooperate with
that of the United States in matters pertaining to continental
defense. Apart from this consideration, on which the Ministry for
Foreign Affairs wishes to emphasize the resolve of this Government,
it believes that it will be advantageous and useful to state as
clearly as possible the attitude of the Government of the Republic
regarding the matter of arms.
I.
The Government of Guatemala is grateful for the benevolent offer of
the United States to furnish to it armament and munitions of war;
and declares that, as regards arms which it needs for its own
defense and local use, it has determined to pay in currency and for
cash.
This Government considers that the payment, made at the moment of the
delivery of the material, ought not to bring to it greater burdens
(no ha de reportarle may ores
gravámenes), and, moreover gives it the right to the usual
discounts to those who pay cash.
A simple and clear contract could be drawn up setting forth exactly
the reciprocal obligations of buyer and seller; and, as soon as that
draft contract is approved, this Government would proceed to sign it
without further delay.
II.
Having concluded drawing up the terms of the contract for the
purchase of arms for Guatemala’s own defense and local use as set
forth in the preceding paragraphs, it is pertinent to consider
another
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aspect of the
special situation of the Republic in relation to the present
international emergency: This aspect is as follows:
As the Legation is aware, the Government of Guatemala has placed at
the disposition of the United States whatever it has and possesses
in its territory which could be used for cooperation in defense of
the fundamental interests of the hemisphere at the head of which the
United States has placed itself in the crusade for liberty and human
rights. Notwithstanding the danger of thereby attracting attacks of
totalitarian forces, airports and coasts of the Republic have been
fortified or are being fortified for the defense of the
continent.
It is logical, as a consequence of the measures of military nature
that, in order to collaborate with the United States forces
presently and in the future on Guatemalan soil, the Guatemalan Army
needs to import arms adequate for the defense which is being
organized: The Government of the Republic deems that its conduct in
this matter is to cooperate with the United States in the collective
defense; it does not consider it just that, under the circumstances
referred to in the preceding paragraph, the armament which may have
been ceded to it for mutual defense and which may be in good
condition and not needed after the cessation of hostilities, should
be an expense to the Guatemalan Government.
The Government of Guatemala has been referring to this type of
armament, as His Excellency the Minister of the United States will
recall, with the insistent request that such matériel be furnished
as a loan under the United States law of March 11, 1941, with the
option of returning it after the war, provided it is in good
condition or unused.
The Government of Guatemala has not pretended that, under similar
circumstances, it be given advantageous concessions over the other
American Republics. Now, by reason of the explanations made, whether
orally or in the extract of the diplomatic correspondence which the
Ministry for Foreign Affairs had the honor to place in the hands of
His Excellency the Minister of the United States, it (the Ministry
for Foreign Affairs) understands that the matter is elucidated and
crystallized in the aforementioned terms.
In summary, the Government of Guatemala is disposed:
- 1.
- To buy arms which it needs for its own defense and local
use, paying cash;
- 2.
- To obtain under the terms of the lend-lease law, arms
which are needed to collaborate with the United States in
the defense of the American continent.
As has been explained, the Government of Guatemala has hastened to
place at the service of collective defense all the national
resources
[Page 439]
which are
necessary to repel direct aggressions of the Axis powers: In order
to fight against those forces, the Government of Guatemala will have
to make great sacrifices over and above the material damages which
the aggressors may cause. This not being exactly the case of the
other American Republics which have already signed contracts for
arms with the United States, and, on the other hand, which probably
will not pay cash for those for local use only, the Government of
Guatemala does not see the reason why those Republics should find
unfair the conditions proposed by Guatemala. Moreover, if Guatemala
gives as much as it has and proposes the return after the war of the
arms in good condition or unused, it surely is not seeking a
unilateral agreement for the exclusive benefit of Guatemala.
The Ministry for Foreign Affairs takes this opportunity to reiterate
to the Legation of the United States the assurances of its highest
and most distinguished consideration.
Guatemala,
March 6,
1942.
