837.5018/10–2744
The Secretary of State to the Ambassador in Cuba (Braden)
The Secretary of State transmits for the immediate and confidential consideration of the Embassy a copy of a memorandum44 relating to the possible inclusion of a price stabilization agreement in the prospective sugar purchase from Cuba. The memorandum was prepared by an official of the Foreign Economic Administration at the instance of the Department.
The agencies of this Government especially concerned with the sugar and molasses negotiations have reviewed the memorandum carefully and have reached the conclusion that it would be desirable, from many viewpoints, to avoid in the sugar agreement any commitment to stabilize certain prices in Cuba, [such] as [the commitments] in the [Page 946] past two purchase agreements. However, it may become impossible in the course of the negotiations to avoid such a commitment. In any case the Department and the other agencies would appreciate receipt of your comments by urgent airgram or telegram, on the memorandum and on the general price control situation.
If price stabilization program is undertaken, the interested agencies are likely to recommend that no special wheat flour subsidy be made available to Cuba beyond the proposed subsidy that would be available to all friendly countries, which is scheduled for announcement in two to three weeks. According to the calculations in the wheat flour section of the enclosed memorandum, the third formula indicates that the application of the proposed general subsidy to Cuban imports would apparently make possible the maintenance of the present 12-cent price of bread.
- Not printed; file copy unsigned and undated.↩