FOREIGN MINERAL ECONOMICS. . . . . . . . . . . . . . . . . . . . . . . $80,000

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00682R000300020016-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 9, 2016
• Document Release Date: August 11, 2000
• Sequence Number: 16
• Content Type: REPORT

*DOI Waiver Letter In ERU File*
Approved For Release 2001/03/06 : CIA-RDP91-00682R000300020016-3
ENCLOSURE NO. 2
Foreign Mineral Economics ................................ ......080,000
Before the war the government's information and economic services on for-
eign mineral activities were grossly inadequate as a. result of which there was
a serious lack of first-hand data on enemy mineral potentials and the availa-
bility of foreign materials to meet the tremendously increased domestic demand
for minerals in the defense and war programs. Procurement was delayed, and there
was a rush to obtain the needed.basic data, with which such purchasing as well as
preclusive buying and the "Good Neighbor" programs could be planned and executed.
Staffs of technical experts were. quickly recruited in the various war agencies
responsible for these activities and sent abroad to centers of production of
strategic and critical minerals. The effort was extremely costly and. inefficient,
an inescapable consequence of the lack of preparedness in this field.
The government.'s permanent facilities for obtaining and analyzing foreign
mineral information must be expanded not only to prevent a recurrence of the
experience of the past few years, but to meet the needs for the future. As
applied to this budget item, and in particular to its relationship to national
security, the modest increase in funds requested is amply justified in House
Report No. 2734 of December 17, 1946, on the system currently employed in the
collection, evaluation and dissemination of intelligence affecting the war
potential of the United States, prepared by.the Committee on Military Affairs,
House of Representatives. The United States is now and has been the most self-
sufficient nation of the world in minerals, yet it has always had important
deficiencies.- 2anganese, chromite, tin, and nickel, for example, are indis-
pensable to the industrial economy of this country and domestic requirements
for decades have been met' principally be imports. Dependence of the United
States on foreign sources for supplies of many important minerals, including
copper, lead, and zinc, will increase in the future. Consequently, in the years
to come and particularly in the reconversion period, minerals will occupy an
even more significant place in international affairs than in the past. This
and other factors such as the need for markets for those minerals which we can
produce for export, the mineral policy considerations relating to national defense,
conservation of domestic resources, tariff programs and future international
cooperation. in solving problems of an economic character, all require complete
and current knowledge of mineral developments on a world-wide basis. It is
therefore imperative that the Bureau of Mines' staff of international mineral
specialists be increased to analyze and. interpret foreign mineral information
for the benefit of industry, the public, and the agencies of the Federal Govern-
ment responsible for the formulation of economic foreign policy and national
security. It is also imperative that this Government maintain at certain
embassies abroad technical observers competent to secure information that will
be needed in ",ashinton, and to advise diplomatic officers on local problems
relating to minerals. It is especially important that this expansion be made
at this time so that the knowledge gained during; the war at tremendous costs
may be retained for the permanent benefit of the Government and particularly
to meet the needs of the next few years.
The need for an improved foreign reporting service for minerals has been
recognized for many years but not until 1935 was any constructive action taken.
In that year one of the experts of the Bureau of Mines was sent to Europe to
report on the mineral situation in that area. In 1939, with war imminent, he
was transferred to South America where he continued his investigations of foreign
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mineral activities. Shortly thereafter, Foreign Mineral Specialists were
assigned to-the Embassies at Rio de Janeiro, Buenos Aires, Santiago, Lima,
La Paz and Mexico City. In July 1912 this Foreign Iineral Service of the
Bureau of Mines, with the approval of the Budget Bureau, was transferred
to the Department of State where it was established as a .Minerals Attache
Service under the Forcin Service Auxiliary, created by Congress as a war
tml measure. This was followed by an agreement between the Secretary of State
and the Secretary of the Interior under which the Bureau of Mines "assumed
responsibility for the recruitment of technically qualified personnel for
the Foreign Service Auxiliary, the preparation and revision of instructions
for the ;uidance'of such personnel, the appraisal on the basis of periodic
program reports and otherwise of the service of such personnel; the main-
tenance of adequate files and records pertaining to foreign mineral,re-
sources and such subjects Tinich grill serve as basic reference material for
the commodity specialists of the Bureau of Mines and for other interested
government agencies." The relationship of the Department of the interior
to the Minerals Attache Service thus became the same as that of the Depart-
ment of Agriculture to the Agricultural Attache Service, and the Depart-
ment of Commerce to the Commercial Attache Service. Subsequently, the for-
sign mineral staff o-f the temporary war agencies was greatly expanded and
the Minerals Attache Service remained essentially in status quo. With the
termination of war activities this temporary wartime arrangement with the
Department of State has been superseded. by Public Law 724, 79th Congress,
effective November 13, 1946, which authorizes the Secretary of State to
assign for special duty abroad for nonconsecutive periods not exceeding
four years and at the expense of the Department of State, qualified experts
in other agencies of the Government. The act requires the loaning agency
to reinstate employees on such assignments following completion of their
tour of duty abroad.
To meet postwar needs a substantial expansion of the Minerals Attache
Service, which now includes representatives only in Peru, Brazil, and the
Union of South Africa, is planned. The Department of State has requested
the Bureau of Mines to assume responsibility for mineral reporting special-
ists that are required in eleven areas of the world (Peru, Bolivia, Brazil,
Mexico, Belgian Congo, Union of South Africa, China, India, England, Western
Europe (Paris), Central-Southern Europe (Berlin), and may be appointed as
Reserve Officers under Sections 522 and 528, Part C, of Public Law 724,
effective last November.
To give industry, the public and the Government the type of factual
information and analysis required in the future, the Bureau of Dines pro-
poses to enlarge its staff of regional and .ternational commodity special-
ists to provide adequate facilities for meeting the greater responsibili-
ties of the years ahead. We cannot plan our international program and
national defense without adequate current data and men qualified to inter-
pret them from a background of first-hand experience. This professional
staff must be provided with adequate statistical and clerical services and
travel funds so that it may be fully informed at all times. The increase
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 Approved For Release 2001/03/06-3CIA-RDP91-00682R000300020016-3
requested for the fiscal year 1948 is designed to initiate the broad pro-
gram outlined above and to provide a part of the necessary technical staff
needed to dischar;e properly the new duties and responsibilities placed upon
the Bureau of Mines by Public Law 520, 79th Congress, approved July 23,
1946. This"act authorizes the Secretary of the Interior and the. Secretaries
of War and Navy to determine the quantity and quality of the materials to be
stockpiled. To carry out this function the Bureau of Mines must be prepared
to provide comprehensive data on foreign minerals for the use of this com-
mittee, the Array and Navy Munitions Board, and the procurement agencies.
Current information on the availability of foreign minerals of acceptable
grade for stockpiling must be collected and prepared for consideration in
administering the stockpile program. All of the usual problems of foreign
procurement are involved and the program differs from the wartime work only
in the matter of timing. The estimated cost of initiating the improved ser-
vice on an annual basis is shown below. Substantial increases in this appro-
priation will be needed in future years to complete fully the above program.
PERSONAL SERVICES, DEPARTIENTAL
2 Foreign "Mineral specialists (Regional), P-6 at : 7,102...14,204
1'Foreign IlMineral specialist (Regional), P-5 at X5,905.... 5,905
3 International commodity specialists, P-6 at `7,102 ...... 21,306
1 International commodity specialist, P-5 at r?5,905....... 5,905
l Economic analyst, CAF-7 at a3,397......?. ...........?. 3,397
1 Statistical clerk, CAF-5 at ':;2,645..?.?...... 2,645
.5 Clerks, CAF-4 at 42,394 ................................. 11,970
5 Clerks, CAF-3 at 2,168 ......................... ....... 10,840
8 Clerks, CAF-2 at .$1,954 ................................. 15,632
.....,....91,804
Total permanent, departmental ........................
Loss lapsed salaries.......................................... . 18,359
ei Personal; Services (net) ....................................... 73,445
02 Travel ......................... -.44,000
03 Communications .................................>....... 500
08 Supplies and materials ................................ 1,055
_ ? r . r . 12000
09 Equipment ?...........?..........?........?....... .
Total other obligations ...................................... 6,555
Total increase .................... ........................,80,000
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