¹ These trends had significant antecedents before 1930, but they were reinforced in the thirties and gained momentum in the forties. Cf. Diaz-Alejandro, C., ‘Latin America in the Thirties’, in Thorp, Rosemary (ed.), Latin America in the Thirties: The Role of the Periphery in World Crisis (Oxford, 1984), pp. 17–49Google Scholar; Lewis, C. M., ‘Industry in Latin America Before 1930’, in Bethell, Leslie (ed.), Cambridge History of Latin America, vol. IV (Cambridge, 1986), pp. 269–319Google Scholar. See also Suzigan, W., Industriali^afao Brasikira: Origem e Desenvolvimento (Sāo Paulo, 1986)Google Scholar.

² Cf. M. P. Abreu, ‘Argentina and Brazil During the Thirties: The Impact of British and American International Economic Policies’, in R. Thorp (ed.), Latin America in the Thirties, pp. 144–62; Abreu, M. P. ‘Anglo-Brazilian Economic Relations and the Consolidation of American Pre-eminence in Brazil, 1930–45’, in Abel, C. and Lewis, C. M. (eds.), Latin America, Economic Imperialism and the State: The Political Economy of the External Connection from the Independence to the Present (London, 1985), pp. 379–93Google Scholar; Gravil, R., ‘A Time of Acute Dependence: Argentina in the 1930s’, journal of European Economic History, vol. 7, nos 2 and 3 (1978), pp. 337–78Google Scholar.

³ The UK promised to consult Argentina in case she needed to apply further restrictions on imports from this country. British restrictions on imports of chilled beef from Argentina should not exceed 10% of the imports of the period June 1931-July 1932. For frozen beef and mutton, progressive restrictions would be imposed. Argentina was expected in turn to use the sterling earned to buy British goods and to pay the dividends and interests owed to British capital, after the deduction of interests owed to other governments.

⁴ The Roca-Runciman Agreement aroused strong criticisms in Argentina. It was considered that too many concessions had been given to the UK in order to defend a group of exporters (basically, the exporters of chilled beef) which in practice accounted for a relatively small part of Argentine total exports. Some authors have pointed out that the Agreement was the price that the government paid for preserving the so-called ‘concordancia’, the conservative political coalition of the thirties (cf. Fodor, J. and O'Connell, A., ‘La Argentina y la Economfa Atlantica en la Primera Mitad del Siglo XX’, Desarrollo Economico, vol. 13, no. 49 (1973), pp. 3–65CrossRefGoogle Scholar; see also Gravil, ‘A Time of Acute Dependence’). Conversely, Alhadeff has argued that the Agreement was instrumental for economic recovery after 19 3 3, as the Roca Funding Loan made it possible to finance a price support programme for the agricultural sector (cf. P. Alhadeff, ‘Dependency, Historiography and Objections to the Roca-Runciman Pact’, in Abel and Lewis, Latin American, Economic Imperialism and the State, pp. 367–93). This author has also suggested that the expansion of public debt had a stimulating effect while the fund boosted consumers and business confidence by reducing interest rates.

⁵ The Pinedo Plan is reprinted in Desarrollo Economico, vol. 19. no. 75 (1979), pp. 403–26.

⁶ This distinguishes this first attempt at economic integration from that of the late fifties, when import-substituting industrialisation had already become the dominant strategy. Pinedo, F., ‘Relaciones Economicas Inter-Americanas’, Revista de Economia Argentina, vol. 41, no. 290 (1942), pp. 234–38Google Scholar, emphasised that the efforts to form a customs union with Brazil should be seen as a step forwards, to integrate Argentina to the new international economy. He concluded that ‘an economic union among few or many Latin American countries… to be fruitful, has to be aimed to the elimination of barriers in the region, and not to the exclusion of what is extra-continental’ (cf. Pinedo, ‘Relaciones Economicas Interamericanas’, p. 238).

⁷ The difficulties faced by trade liberalisation in the sixties would indeed fully confirm the soundness of this proposal for taming indiscriminate protection at an early stage.

⁸ Pinedo to Berger, Centro de Pesquisa e Documentação (hereafter CPDOC), Souza Costa Archive (hereafter SC), Buenos Aires, 12 September 1940 (CPDOC, SC, 40.09.12). Similar emphasis on the diversification of the structure of trade can be found in Pinedo's letter to the Brazilian Foreign Minister Osvaldo Aranha (cf. CPDOC OA 40.01.23, Buenos Aires, March 1940). Concern with the efficiency of industrialisation and the role of the economies of scale suggests a continuity between the Pinedo Plan and the subsequent ECLA proposals of economic integration, probably reinforced by the participation of Raul Prebisch in the formulation of both initiatives.

⁹ Letter from the Brazilian Ambassador in Buenos Aires, Rodrigues Alves, to Foreign Minister Osvaldo Aranha (CPDOC OA 40.01.23, Buenos Aires, 27 September 1940).

¹⁰ A customs union was deemed to represent ‘the way of avoiding that other countries, making use of the clause of the Most Favoured Nation, take advantage of the benefits granted to neighbouring and friendly countries’ (Rodrigues Alves to Aranha, CPDOC OA 40.01.23, Buenos Aires, 27 September 1940).

¹¹ Brazilian sources reported that Argentine Foreign Minister Torriani was prepared to ‘denounce the treaties with England if they compromise Argentine objectives in a moment in which the country goes through such great difficulties’, in relation to UK pressures against the treaty with Brazil (cf. letter from Rodrigues Alves to Aranha, CPDOC OA 40.0123, Buenos Aires, 29 January 1941). Clearly, it is unlikely that Argentina could take such a bold step at that time. But Torriani's reaction is indicative of the interest shown by Argentina in achieving a free trade agreement with Brazil.

¹² In 1941 the Inter-American Economic Consultive Committee of Washington recognised the legitimacy of establishing preferential agreements among neighbouring countries. This possibility was explicitly mentioned in the trade agreements signed then by Argentina with the USA (cf. Rodrigues Alves to Aranha, CPDOC OA 40.01.23, Buenos Aires, 25 October 1941, p. 3).

¹³ This convergence of proposals was emphasised by Pinedo during the debates in the Senate Chamber: ‘Either our plan is in the right direction to work out our problems or our adversaries have no imagination at all, because they have not raised alternative proposals. They have just limited themselves to offering the same proposals’. Cf. the debate in the Senate Chamber, 17 December 1940, reprinted in F. Pinedo, En Tiempos de la Kepublica (Buenos Aires, 1947), especially p. 270.

¹⁴ Cf. Llach, , ‘El Plan Pinedo de 1940, su Significado Historico y los Orfgenes de la Economfa Poh'tica del Peronismo’, Desarrollo Economko, vol. 23, no. 92 (1984), pp. 5I5–57–15Google Scholar.

¹⁵ The objective of reaching an agreement on economic and political reform was made explicit by Pinedo, in an interview given to the newspaper La Nation, published on 12 01 1941Google Scholar.

¹⁶ This situation was at variance with what would happen in 1953–4, when Peron launched his economic union proposals, to be discussed below. In the early fifties bilateral relations between Brazil and Argentina became a hotly debated and conflictive issue in Brazilian domestic politics which decisively contributed to curb economic cooperation.

¹⁷ Cf. Paz, A. C. and Ferrari, G., Político Exterior Argentina, 19)0–62 (Buenos Aires, 1964), pp. 57–63Google Scholar.

¹⁸ President Cantilo severely condemned US protectionism as the USA only offered to reduce tariffs on meat and linseed up to a restricted quota. The British (whose bilateral practices were usually criticised by the USA) pointed out this contradictory move in US policy: ‘negotiations between the Americans and the Argentines broke down because America was prepared to give away very little and wanted too much. Despite the lofty ideals about unhampered development of world trade they insisted upon a system of quotas with a corresponding obligation of Argentina to buy American goods’. Cf. FO 371 2416, 22 January 1940.

¹⁹ Reporting on a conversation with Pinedo, Armour suggested that the basic point in Argentine-US relations was to open the US market to Argentine products. Armour pointed out that 'what Argentina needs is a minimum of economic security and an opportunity to sell more in the Western hemisphere…. The greater problem that will have to be faced eventually is the question of markets for wheat, meat and other products that the USA cannot absorb (cf. Armour to the Secretary of State, 611.3531/1538 in Foreign Relations of the United States, 1940, vol. v (Washington, 1961), pp. 462–3Google Scholar.

²⁰ Cf. Escudé, C., Gran Bretaña, los Estados Unidos y la Declinación Argentina (Buenos Aires, 1986), pp. 322–9Google Scholar; Lanús, A., De Chapultepec al Beagle: Politico Exterior Argentina, ipjf-iySo (Buenos Aires, 1984), pp. 24–32Google Scholar.

²¹ Cf. Escudé, Gran Bretaña, los Estados Unidos y la Declinación Argentina, especially pp. 322–9.

²² In January 1944 a Brazilian Commerical mission arrived at Buenos Aires in order to negotiate the supply of rubber tyres to Argentina. Th e USA is reported ‘to place every obstacle in the way of Argentina acquiring rubber supplies from Brazil’ (cf. F O 371 37723: A S 144, 7 January 1944). Commenting on the US-Chilean copper limitation agreement, Corden Hull stated that ‘perhaps the greatest advantage of the agreement from our point of view has been a voice in the control of copper exports to Argentina’. Cf. ‘Secretary of State to Ambassador Bowens’, Chile-835.24/244;, Telegram in Foreign Relations of the United States, 1944, vol. VI I (Washington, 1964), p. 706.

²³ On the foreign policy of the Eisenhower administration see Rabe, S. G., Eisenhower and Latin America: The Foreign Policy of Anti-Communism (London, 1988)Google Scholar. The change in foreign policy began in the late forties, when the objective of promoting democracy was gradually abandoned in favour of a policy based on cruder security concerns (cf. Bethell, L., ‘From the Second World War to the Cold War’, in Lowenthal, A., Exporting Democracy: the United States and Latin America (London, 1991), pp. 41–70Google Scholar.

²⁴ Cf. ‘Argentina Crisis: US Officials Favour Peron – But Largely for Business Reasons’, The Wall Street Journal, 27 Jun e 1955.

²⁵ Cf. Rabe, Eisenhower and Latin America, p. 38.

²⁶ For a review of the ‘dollar shortage’ debate of the period see Yeager, L. B., International Monetary Relations: Theory. History and Policy (New York, 1966)Google Scholar, especially the appendix to chapter 25. By the end of 1953 60% of Argentine trade was covered by bilateral agreements. Cf. Bank of London and South America, Fortnightly Review, vol. 18, no. 448 (1953). P. 789Google Scholar.

²⁷ On the Argentine aspiration to increase her influence in the region see FO 371 108793, AA 1021/1, 4 January 1954.

²⁸ CF. letter from Luzardo to Vargas, CPDO CG V 52.01.14, Cartas(8), Buenos Aires, 27 March 1952, pp. 4–5.

²⁹ The 1953 treaty was expected to (i) stimulate trade and industrialisation in both economies; (ii) gradually reduce tariffs and other trade barriers; (iii) simplify bilateral exchange controls; (iv) provide for the free transit of goods towards third countries; (v) develop the transport infrastructure. Cf. US State Department Central Files, ‘Economic and Financial Review, Second Quarter 1953’, 855.00/7–1453, Desp. N.38, 14 07 1953, Argentina: Internal Affairs, Microfilm, Decimal Numbers 735,835 and 9 3; (Maryland, 1987)Google Scholar. Although the composition of trade between Chile and Argentina was basically made up of primary products, some modest steps were given in order to promote industrial trade. A subsequent agreement signed on 19 July 1954 between metallurgic producers of Argentina and Brazil was placed before the Commission of the Economic Union Treaty with a view to including metallurgic products in the exchange list. The results were largely disappointing, however, because of the continuity of the obstacles that Argentina and Chile placed on the concession of import permits. Cf. ECLA, Comercio Inter-Latinoamericano de Productos en 1914 y 19Situationy Perspectivas en 19)6 (New York, 1956b), pp. 16–17Google Scholar.

³⁰ US observers pointed out that ‘Argentina's international aspiration includes a dominant position in Southern South America, a position of leadership in Latin America and a place in the world corresponding to somewhat inflated views of national capabilities. To reach these goals, Perón requires internal economic expansion, a free hand to assert Argentine influence over neighbouring countries and foreign support for Argentine pretensions in word affairs.’ Cf. NIE-91–54, 9 March 1954, Secret, in Foreign Affairs of the United States, 1952–55, vol. IV (Washington, 1983), p. 462.

³¹ A 1935 commercial agreement allowed Brazilian coffee exports to enter free of taxes in the U S market. Cf. ECLA, Estudio del Comercio Inter-Latinoamericano (New York, 1956a), p. 76Google Scholar.

³² Cf. The expression was coined by Burns, E. B. (1966), The Unwritten Alliance: Rio Branco and Brazilian-American Relations (New York, 1966)Google Scholar.

³³ Cf. Abreu, ‘Argentina and Brazil Durin g the Thirties’, especially pp. 150–51.

³⁴ Cf. FO 371 2416, 22 January 1940. However, as discussed, the ‘enlightened hegemon’ view of US policy cannot be extrapolated to the case of Argentina. The USA adamantly resisted in this case the liberalisation of imports of agricultural products which could harm the interests of agricultural producers in the USA.

³⁶ The tolerance of the USA towards Brazil's German connection was also pointed out in a personal letter to Corden Hull by a former member of the Brazilian Treasury Delegation in the USA: ‘From 1937 to 1940 the USA saw Germany leap to first place in the Brazilian market. (…) It saw Brazil buying arms and munitions in Berlin with the gold collected for coffee sold in New York. Impassably, the USA almost begged pardon to the Brazilian dictator for his provocations’ (cf. FO 371 37889 AS 4545/ 36/54/6, 26 August 1944).

³⁶ It is a matter of debate whether US goodwill towards Brazil was secured by Vargas's ability to capitalise on certain strategic assets (such as the vulnerability of the Brazilian North East coast during the war, the German efforts to enlarge her influence in Latin America, and the enduring Argentine dispute with the USA) or was just the ‘residual’ consequence of US efforts to consolidate a long-term project of hegemony, now cloaked in a multilateral approach to commercial relations. See Hilton, , ‘Brazilian Diplomacy and the Rio-Washington Axis During the World War Second Era’, Hispanic American Historical Review, vol. 59, n. 2 (1979), pp. 201–31CrossRefGoogle Scholar: Vargas acted in a ‘machiavellian’ fashion giving false assurances to both the USA and Germany, in order to keep a highly profitable double approach – bilateral and multilateral – to trade policy. Moura, G., Autonomia na Dependência: A Politico Externa Brasileira de 193j a 1942 (Rio de Janeiro, 1980), especially p. 63Google Scholar, highlights the ability of Vargas to maintain a ‘pragmatic equidistance’ which allowed him to secure concessions from both rivals. Abreu, ‘Anglo-Brazilian Economic Relations’, suggests, on the contrary, that Vargas obtained very little additional bargaining power from his German connection and emphasises instead the role played by the US long-term objective of consolidating multilateralism and containing Argentina.

³⁷ Cf. Moura, Autonomia na Dependencia, pp. 91–2. Commercial links with German y would subsequently end with the beginning of the war and the British naval blockade.

³⁸ This cooperation included the construction of military bases with US personnel in the North East (April 1942), the declaration of war on the axis (August 1942) and the despatch of Brazilian troops to the Italian war theatre by the end of 1944.

³⁹ Cf. Escudé, C., La Argentina Versus las Grandes Potencias: El Precio del Desafío (Buenos Aires, 1986), pp. 158–82Google Scholar; Hurrell, A., ‘The Quest for Autonomy: The Evolution of Brazil's role in the International Economy’, unpubl. PhD diss, University of Oxford, 1986, pp. 31, 60Google Scholar.

⁴⁰ It has been argued that Brazil's policy-makers suffered from a misperception of where Brazil's true international interests were after the end of the war. Cf. Moura, G., ‘Brazilian Foreign Relations, 1959–50: The Changing Nature of Brazil-United States Relations During and After the Second World War’, unpubl. Ph.D. diss., University of London, 1982Google Scholar.

⁴¹ Cf. Malan, (1984), ‘Relaçōes Econômicas Internacionais do Brasil, 1945–64’, in Fausto, B (ed.), História Geral da Civilização Brasileira: O Brasil Republicano, Economia e Cultura, vol. III, p. 63Google Scholar.

⁴² The Joint Brazil-US Commission had been created in December 1950.

⁴³ This process was observed by US analysts with growing concern: ‘In recent years, US-Brazilian relations have been impaired by growing Brazilian nationalism, which has produced friction in both economic and political-military affairs…. In particular, Brazil feels that the US economic and financial assistance to Brazil has not been commensurate with Brazil's past services and present strategic importance to the USA, and with Brazil's value to the USA as a moderating influence in Latin America and United Nations affairs’. (Cf. ‘National Intelligence Estimate’ Secret, 86, 4 December 1954, in Foreign Relations of the United States, 1952–55 vol. IV (Washington, 1983), p. 643.

⁴⁴ Saenz Peñla paid a visit to Brazil in 1910 with the aim of establishing a ‘Pacto de Cordial Inteligencia’. In 1915 the so-called ‘ABC Treaty’ was signed by Argentina, Brazil and Chile. This intended to set up a cooperative framework for dealing with international problems in the region. The treaty would subsequently fail to be ratified by the Argentina Chamber of Deputies. Cf. Bandeira, L. Moniz, O Eixo Argentina-Brasil: O Processo da Integração da América Latino (Brasília, 1987), p. 20Google Scholar.

⁴⁵ Rivalry between the two countries began in colonial times, in the struggle between the Spanish and Portuguese Empires in Latin America. A comprehensive study of Argentine and Brazilian political relations is provided by Bandeira, L. Moniz, Estado Nacional e Político Internacional no América Latina (Brasília, 1993)Google Scholar. An account of the different moments of cooperation and rivalry in bilateral relations can be found in Jaguaribe, H., ‘Brasil-Argentina: Breve Análisis de las Relaciones de Conflicto y Cooperatión’ Estudios Internacionales, no. 57 (1982), pp. 9–27Google Scholar.

⁴⁶ In this letter Storni asked for the ‘urgent provision of airplanes, spare parts and machinery to restore Argentina to the position of equilibrium with respect to other Latin American countries’. Cf. Humphreys, R. A., Latin America and the Second World War, vol II (London, 1982), pp. 152–3Google Scholar.

⁴⁷ In May 1943 Brazil conceded important benefits to Paraguay which then had much closer ties with Argentina. Cooperation included a loan for public works in Paraguay. Paraguay and Bolivia were regarded as ‘a diplomatic battlefield between Argentina and Brazil’ (cf. Artigas Library, Ministry of Foreign Affairs, Uruguay (hereafter AL), Box 61, Ambassador Gutierrez to Serrato, 24 May 1943). See also on this point Moniz Bandeira, Estado e Político Internacional, p. 68

⁴⁸ Cf. Humphreys, Latin America and the Second World War, p. 122.

⁴⁹ Reactions in Brazil to the economic union treaties were ‘of repudiation to the expansionist tendencies associated with the so-called “doctrinajusticialista”’. Itamaraty was also expected to endeavour to ‘limit the Argentine action in neighbouring countries and to persist in its pan-American policy’ (cf. AL, Box 101, Section 1a, N.5/53, C.9/953, Confidential, from Uruguayan Ambassador Pittaluga to the Foreign Minister, Rio de Janeiro, 4 March 1953). In a polemic speech delivered by the senator of the União Democrática Nacionalista (UDN), Assis de Chateaubriand, Uruguay (which then faced a serious diplomatic conflict with Argentina as a result of the activities of Argentines exiled in Montevideo) was highlighted as a country which Brazil should approach in order guarantee the ‘sovereignty of the Uruguayan democracy, so much threatened by Argentina’ (Cf. AL, Box 101, Section 1a, N.5/53, 518/953. 17 August 1953).

⁵⁰ In the words of the Chilean Ambassador in Rio de Janeiro: ‘My country needs a commercial association with all these countries which could complement her economy with a view to enhancing progress and welfare. The recent visit of President Perón to Chile (…) had the objective of studying agreements of an exclusive economic nature. All that has been said denying this objective is completely baseless’ (Cf. Correio da Manhã, Rio de Janeiro, 12 March 1953).

⁵¹ Cf. Moniz Bandeira, Estado e Política Internacional, p. 66.

⁵² Cf. 611. 35/6–2352, Secret, 1 March 1952, in Foreign Relations of the United States, 1952–54, vol. iv (Washington, 1983), p. 405.

⁵³ Cf. on this point the interesting analyses of Escudé (1988), El Precio del Desafío, pp.133–412.

⁵⁴ Cf. FO 371 108793: AA 1021/1, 4 January 1954; and FO 571 108796: AA 1041/1, 20 January 1954.

⁵⁵ Cf. Grunwald, et al. , Latin American Integration and US Policy (Washington, 1972), p. 92Google Scholar.

⁵⁶ Cf. ‘Minutes of the Meetings Held in the Executive Office Building’, MSA-FUA, Director's files, FRC 56 A 632, Confidential MISC/RH-47, 2I June 1954, in Foreign Relations of the United States, 1952–54, vol. IV (Washington, 1983), p. 323.

⁵⁷ See on this point Hirst, M., O Pragmatismo Impossível: A Político Exterior do Segundo Governo Vargas (1951–54) (Rio de Janeiro, 1990), especially pp. 22–23Google Scholar.

⁵⁸ Hirst (1990), A Político Exterior do Segundo Governo Vargas, p. 38, has observed that ‘in no other moment in contemporary Brazilian history had the relations with Argentina generated such a great internal political mobilisation’ as in the first months of 1954. ‘Peronism was characterized as a major threat which could distress both the internal order and the international commitments of Brazil’ (Ibid., p. 38).

⁵⁹ The UDN even accused Vargas of having received funding from Perón for his electoral campaign. Meanwhile, the Peronist press in Argentina openly voiced its preference for Vargas's candidacy (cf. L. Moniz Bandeira, Estado Nacional e Político Internacional, pp. 71–2).

⁶⁰ For instance, Vargas nominated Baptista Luzardo, a close friend of both Perón and Vargas, as Ambassador in Argentina. At the same time, he nominated Joäo Neves da Fontoura, a political enemy of Luzardo and firmly opposed to cooperation with Argentina, as Foreign Minister. Luzardo's diplomatic activities in Buenos Aires were under continuous attack by those associated with Neves da Fontoura. Cf. for instance the letter from Neves da Fontoura to Vargas, CPEDOC GV Correspondências (15)52.01.13/3, Rio de Janeiro 17 March 1952 and the letter from Luzardo to Vargas, CPDOC GV 52.08.22/2, Buenos Aires 7 August 1952.

⁶¹ It seems that Argentina did invite Brazil to participate in the economic union treaty with Chile, and this was well received by Vargas. These contacts were made in confidentiality through Ambassador Luzardo in Buenos Aires, a personal friend of both Vargas and Perón (cf. Lanús, De Chapultepec al Beagle, pp. 286–88).

⁶² Anti-Peronist feelings in Brazil were so strong that this alleged connection between Vargas and Perón was used again in September 1955 in an attempt to discredit Vargas's political heirs, Kubitschek and Goulart (cf. FO 371 114027 A 1041/1, Confidential, 30 September 1955).

⁶³ O Globo, 4 April of 1954. João Neves left the Ministry of Foreign Relations in June 1953, when he was substituted by Vicente Rao. Vargas then also nominated João Goulart for the Ministry of Labour and Osvaldo Aranha for the Economic Ministry.

⁶⁴ This point was made by Jaguaribe, H., ‘A Denúncia de Joäo Neves’, Cadernos de Nosso Tempo, vol. 1, no. 2 (1954), pp. 83–100Google Scholar. In his remarkable analysis of the ‘João Neves Accusation’, Jaguaribe offered a broad discussion of the convenience of closer political and economic cooperation between Brazil and Argentina, and set forth many ideas that would reappear later in the ‘New Foreign Policy’.

⁶⁵ Cf. Ministry of Foreign Affairs, Brazil, Secretary of External Relations, Centre of Documentation (hereafter SERE-CDO-Brasilia), ‘Expedidos Diversos no Exterior: Instruções para a Delelgaçäo Brasileira a Conferencia Economica da OEA’, Confidential, 13 August 1957.

⁶⁶ The British ambassador in Rio observed that ‘in the first days after the revolution [the military coup in Argentina], the Brazilian ambassador was enthusiastic in his praise of the new regime and it seemed that the Brazilian government thought the opportunity a good one to assert dramatically its independence of the USA’ (cf. FO 371/33598, 10 June 1943). In a private conversation with British diplomats, the Brazilian Foreign Minister Osvaldo Aranha emphasised the gains accruing to Brazil from an early recognition of the Argentine government, namely (i) it proved that Brazil was really South American; (ii) it obtained the sympathy of the Argentines; (iii) it would stimulate Argentine cooperation in continental affairs; (iv) it showed to the USA that Brazil remained ‘the chief link between them and South America’ (v) it ‘assisted in consolidating Brazilian leadership in the region’ (cf. FO 37133589 A 6952, 27 July 1943)

⁶⁷ Cf. Telegram, 835.0012–2546, Secret, 25 February 1946, in Foreign Relations of the United States, 1946, vol. xi (Washington, 1969), p. 223.

⁶⁸ Cf. ‘Entrevista con el Ministro de Relaciones Exteriores Sr. Velloso Sobre la Reciente Nota Argentina’, AL 31–3, 596/944, 12 Novembe r 1944. In addition, Brazil resented the centralised control that the USA exercised over certain Brazilian exports during the war. Osvaldo Aranha is reported to have said ‘in confidentials terms that he was opposed to the control mechanisms through which the USA managed the distribution of quotas for rubber and rubber tyres. These mechanisms are heavily centralised in Washington’ (cf. letter from Ambassador César Gutiérrez to Serrato, AL, 31–4/249/942, 22 June 1943).

⁶⁹ Cf. FO 371 61157: AS371/371/2, 7 January 1947. In May 1947 Presidents Perón and Dutra met at the border city of Uruguayana, where they inaugurated an international bridge and signed agreements on border trade and transportation. Dutra was criticised by Lacerda after his meeting with Perón. Lacerda (always suspicious of the rapprochement between Argentina and Brazil) feared that Dutra had assumed the commitment to support Argentina in the Pan-American system in exchange for Argentine wheat (cf. AL, Box 76, 367/947–1a, Strictly Confidential, 6 June 1947). The view that Dutra represented a much less dramatic change with respect to Vargas than usually assumed in the bibliography has been analysed by Almeida, P. R., ‘A Diplomâcia do Liberalismo Econômico: As Relacões Internacionais do Brasil Durante o Governo Dutra’, mimeo, Universidade de São Paulo, Série Política Internacional e Comparada (São Paulo, 1991)Google Scholar.

⁷⁰ Even João Neves da Fontoura, who was one of the protagonists of the incident over the 1953–54 Argentine initiative to form an economic union, expressed to the US ambassador that ‘Argentina could not be left outside of the Pan-American system and that the USA should give more attention to the attitudes and opinions of the neighbours of Argentina’ (cf. AL, Box 71, ‘Política Internacional y Americana’, section 1a, 17, 834/946, 10 12 1946)Google Scholar.

⁷¹ Cf. letter from Neves da Fontoura to Vargas, CPDOC GV 52.01.14, Rio de Janeiro,14 January 1952).

⁷² The exceptionally low figures of Argentine exports in 1952, however, are not related to US exports but to the failure of the wheat crop in Argentina, related to an extremely severe drought.

⁷³ Already in mid-June a Brazilian economic mission was constituted to visit Latin American countries with a view to promoting industrial exports. Cf. Federação das Indústrias do Estado de São Paulo (FIESP), circular no. 68–40, 28 June 1940. The fear of losing the markets conquered by Brazilian exporters during the war attracted the attention of the industrial associations, FIESP and CIESP. In the 1944 Industrial Congress governmental support was demanded in order to keep the momentum of industrial exports after the war. Cf. FIESP, Congresso Brasileiro da Indústria (São Paulo, 1944), p. 10Google Scholar. The concern of Brazilian industrialists with industrial exports was included in a memorandum handed to President Vargas in late 1952. Cf. FIESP ‘A Indústria e o Comércio de São Paulo ao Exmo. S.M. Sr. Dr. Getúlio Vargas, D.D., Presidente da República: Memorial Apresentado a Sua Excelência por Ocasião de Sua Visita a São Paulo’ (São Paulo, 1941a)Google Scholar. See also the FIESP's publication, Boletim Informativo (thereafter BI), especially BI vol. XIV, no. 167 (15 12 1952), p. 273Google Scholar, and BI, vol. xvi, no. 184 (13 April 1953), pp. 42–3, in which the role of exports of manufactures to Argentina was emphasised.

⁷⁴ Cf. FIESP, Relatório dos Trabalhos Realizados em 1940 (São Paulo, 1941b), especially pp.3–4Google Scholar. Cf. also letter from Pupo Nogueira, Director of the Textile Syndicate to Aranha, CPDOC OA, 40.6.2 3, São Paulo, 20 June 1941. Despite the promise of the Argentina markets, however, exports of textiles fell sharply in the early fifties, because of increasing competition from other countries and Balance of Payments difficulties in Argentina.

⁷⁶ As Brazil displayed a negative trade balance with Argentina and a positive one with the USA, it was suggested that these countries could find a ‘triangular modus vivendi… which could resolve at the same time, by simple compensation, the current economic differences between Brazil and the USA and the problems between Brazil and Argentina’. Cf. Constanzo, Pérez, 1939, ‘Relações Comerciais Argentino-Brasileiras: O Brasil Como Mercado Consumidor de Trigo Argentino e Seus Problemas’, Boletim do Ministério Das Kelações Exteriores, no. 11 (1939), p. 19Google Scholar

⁷⁶ The figures of Argentina are drawn from Díaz-Alejandro, C., Essays on the Economic History of the Argentine Republic (New Haven, 1970)Google Scholar. The figures for Brazil are those provided by the Instituto Brasileiro de Geografia e Estatíśtica, Anuário Estatístico do Brasil (Rio de Janeiro, various years).

⁷⁷ Conversely, in developed countries, in accordance to the pattern early observed by Linder, S., Essays on Trade and Transformation (New York, 1961)Google Scholar, industrial production and the import structure tend to overlap, giving rise to intra-industry trade.

⁷⁸ As mentioned, Brazilian industrialists were very much in favour of a more aggressive policy which encouraged industrial exports to other Latin American countries. However, they were far from enthusiastic about the idea of a free trade area. In a speech given at the Military Club in April 1948, the Brazilian industrial leader Roberto Simonsen offered a sceptical view regarding economic integration in Latin America on the basis of the lack of industrial complementarity in the region: ‘Given the nature of tropical production, a large part of the (Latin American) countries offer similar products. (…) Thus, a Latin American customs union would not have, at the moment, the same justification, foundations and results as a customs union among European countries’. Cf. Simonsen, , ‘O Piano Marshall e um Novo Critério nas Realações Internacionais’, mimeo (São Paulo, 1958)Google Scholar. In other words, in the conditions of the late forties, a free trade area would imply more competition rather than the exchange of complementary products.

⁷⁹ Cf. Mallon, R. and Sourrouille, J., Politica Económica en una Sociedad Conflictiva: El caso Argentina (Buenos Aires, 1973), p. 8Google Scholar.

⁸⁰ The FIESP systematically received military authorities and students of the Superior War School. In an editorial of its official publication, FIESP praised ‘the inter-relation of interests, the growing dialogue between the military and the producers(as classes produtoras)… Weapons, ammunition and transport equipment cannot be improvised, but they result from an advanced and well organized industrial machine, that is, from an industry technically developed’. Cf. BI, vol. VII, no. 92 (9 July 1951) p. 1; see also BI, vol. XIX, no. 159 (20 October 1952), p. 30; BI, vol. XVIII, no. 220 (21 December 1953). P 447; BI, vol. XX, no. 239 (3 May 1954), p. 139.

⁸¹ Even Jaguaribe's forceful defence of cooperation with Argentina identified ‘strategic industries’ as an activity which should be left outside of a regional market (cf. H. Jaguaribe, ‘A Denúncia de João Neves’).

⁸² The main short-term agreements signed within the framework of the Treaty of Commerce and Navigation were the trade agreements of November 1946, May 1949, June 1950, March 1953 and June 1954.

⁸³ Cf. especially Boletín Mensual, vol. 32, no. 358 (31 January 1947), pp. 17–18 and Boletín Mensual, vol. 37, no. 442 (31 July 1052), p. 9.

⁸⁴ Cf. Boletín Mensual, vol. 32, no. 384 (30 September 1947), p. 10.