Special Message to the Congress on Economic Aid to Latin America.

To the Congress of the United States:

In recent months the United States has been considering a number of measures to further the achievement of the primary objective of our foreign policy--the establishment throughout the world of the conditions of a just and lasting peace.

One of the essential requirements for the attainment of that objective is continuing cooperation among the American Republics and collaboration in the development of their resources and industries.

Genuine friendship has long existed between the people of the United States and our neighbors to the south. This friendship has been marked by cultural and economic association and close cooperation. The people of the United States have strongly supported the policy of the Good Neighbor and have a special regard for the peoples of the countries to the south of us.

The United States has long recognized the importance of economic and political stability in the Western Hemisphere. Such stability rests substantially upon the continuation of a satisfactory rate of economic progress. In this respect, we must fairly recognize that the economies of the other American Republics are relatively undeveloped. In these countries, natural resources are abundant but the expansion of production has been restricted due to the lack of capital and of modern production methods. Production can be increased only by means of a considerable volume of capital investment in transportation and power facilities, processing plants and other installations.

To some extent the need for capital in these countries is met by domestic savings, but such savings in general are insufficient to secure the necessary equipment and technical skills. Substantial and continued progress in the development of the resources and industries of the other American Republics therefore requires foreign financing. The United States, by reason of its close relations with these countries and its strong economic position, is the principal source to which the other American Republics look for equipment, materials and technology as well as for their financing.

I recommend, therefore, that the Congress increase the lending authority of the Export-Import Bank by $500 million. The proposed increase in the lending authority of the Bank would not involve any change in the statutory requirements under which the Bank has been operating.

This increased lending authority would place the Bank in a position to assist in meeting essential requirements for the financing of economic development in the other American Republics. It would permit the Bank to make loans for well-planned development projects which are economically justified, and to cooperate most effectively with private funds.

Such an increase would not, of course, be a substitute for necessary action that the other American Republics can and should take to attract private investment capital and to mobilize fully their own investment resources.

The proposed increase represents, I believe, an important step which this Government should take to assist the economic development of the countries to the south of us.

It is of great importance to the United States, as a member of the American community, that there be continued expansion of production, increasing trade activity and rising standards of living in the other American Republics. It is in our mutual interest to help develop in the countries to the south those essential materials which are becoming less abundant in the United States, as well as others regularly imported from distant regions.

Above all, it is in our mutual interest to assist the American Republics to continue their economic progress, which can contribute so much to the cooperative strength of the independent American Republics.

I request the Congress, therefore, to give favorable consideration to the proposed increase in the lending authority of the Export-Import Bank.

HARRY S. TRUMAN