Your Excellency, no doubt, is well aware of the situation; and I am
fully cognizant of the efforts made to improve it. Nevertheless, I
beg leave to insist on one point.
  Long staple cotton is not produced on a large scale in the United
States; it has always been imported from abroad. Orders issued
for the conservation of wool and woolen fabrics, in view of possible
future shortages of the basic raw material, make long staple cotton
a much needed product at present; so that its importation from Peru
would seem an obvious recourse. Consequently, one would have been
led to believe that quota restrictions would be removed in order that
long staple Peruvian cotton could be introduced in this country, as
the best suited for admixture with wool in the manufactory of hosiery
and other fabrics. Unfortunately, such has not been the case. I am
informed that the Department of Agriculture is offering United
States farmers who are willing to produce long staple cotton a higher
subsidy than the one presently established for short staple cotton.
When long staple cotton needed by this country is obtainable in Peru
and could easily be imported, it has been thought preferable to induce
United States farmers to grow that product, excluding thereby the
similar Peruvian one.
  I sincerely trust that Your Excellency will feel justified in bring-
ing, once more if necessary, the whole situation, as briefly sketched
herein, to the attention of the appropriate authorities, so that, if new
subsidies are offered to the United States cotton growers in addition
to the import duties which already protect them, and to the previous
subsidies they enjoy in virtue of the Agricultural Adjustment Act,2s
quota regulations for the importation of long staple cotton may be
at least withheld.
  Please accept [etc.]                          M. DE FiirRiun Y S.


611.2331/293: Telegram
The Acting Secretary of State to the Ambassador in Peru (Norweb)

                               WASHINGTON, March 24, 1942-5 p. m.
  256. Trade agreement negotiations. The Peruvian Embassy has
inquired repeatedly regarding Schedule II proposals to be transmitted
to Peruvian Government through you. However, our position regard-
ing cotton has not yet been worked out and it may be several days
before it can be. Since the list cannot reach you before departure of
Dasso and Beltran, it will be presented here following their arrival.
                                                           WELLES

   Approved May 12, 1933; 48 Stat. 31.



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PERU