Minister for Foreign Affairs yielded yesterday to the British demands and that the question is settled. LAUGHLIN. File No. 814.51/251. The American Chargé d'Affaires to the Secretary of State. Guatemala, May 13, 1913. SIR: With reference to the matter of the solution of the British debt which has been pressed upon the Government of Guatemala by the British Minister, Sir Lionel Carden, I have the honor to report that on the 7th I asked President Estrada Cabrera, during a conversation which I had with him, to inform me in what state the matter then was. He replied that it was quite unchanged since our previous conversation. He again spoke most bitterly of the manner in which the British Minister was pressing his demands, stating that Sir Lionel flatly refused to discuss the matter or to listen to any arguments from him, that he merely repeated that he was there not to argue the question but to demand the rights which the British Government would insist upon. The President informed me that the British Minister had stated that on Saturday, May the 10th, he would present his threatened note at six in the evening. On Sunday the 11th I learned that the note had been presented and an agreement reached between the British Minister and the Government. I at once called at the British Legation where Sir Lionel informed me that in accordance with his promise he had presented a note at six o'clock on Saturday evening stating that relations would be broken on Thursday the 15th if the Government of Guatemala failed to accede to his demands before that time. It seems that the employé carrying the note in question met the Minister for Foreign Affairs coming out of his office at six o'clock. The Minister requested the employé not to deliver the note as he had just finished arranging a counter proposition with Mr. Bickford, local agent of the bondholders, which he was on the point of transmitting to Sir Lionel. The employé telephoned to the British Legation for further instructions and was told by Sir Lionel that the time for listening to a counter proposition had passed, and that he was to present the note as instructed. That same evening, Mr. Bickford was again summoned, and the agreement as outlined by Sir Lionel, was signed. I had the honor to report in my telegram of May 12 such information as I had been able to obtain as to the nature of the agreement. Yesterday afternoon the Minister for Foreign Affairs requested me to call on him. He stated that in view of the moral assistance that the Government of the United States had furnished the Government of Guatemala many times during the financial negotiations, and in view of the friendly interest that I had shown in the matter, he wished to explain to me what had taken place. He stated that every effort had been made to come to a satisfactory arrangement with the American bankers, but that there seemed to be one point on which agreement was impossible, which wrecked the entire negotiations, namely the refusal of the bankers to admit the Government of Guatemala as a judge as well as the bankers, of when a sufficient number of foreign bonds had been bought in. This was the reason for the insistence on the part of Guatemala of the insertion of the words "and the Republic" in the contract which I had previously mentioned to the Department. Therefore there was no other recourse than to accept the demands of the British Minister. According to the Minister for Foreign Affairs these demands consist merely in the restoration of the contract as it stood in 1895, providing for the payment of current interest and amortization. The matter of accrued interest will be taken up at the end of four years by the Government of Great Britain. The tone of the Minister was quite optimistic, a curious contrast to the attitude previously taken by both himself and the President in discussing the matter with me. He felt that the amount necessary to cover the current interest would not only not cripple the financial affairs of Guatemala, but would be so light a burden that it would be scarcely felt. He stated that it was his belief that the resumption of interest payment would immediately cause a considerable increase in the value of the bonds, thus augmenting the foreign credit of Guatemala. The Government of Guatemala will therefore, at the end of some months, be in a much better situation to arrange a loan with American bankers on easy terms. The Minister assured me that the Government of Guatemala had still the fullest intentions of making such an arrangement. I have [etc.] File No. 814.51/253. HUGH R. WILSON. The American Chargé d'Affaires to the Secretary of State. No. 441.] AMERICAN LEGATION, Guatemala, May 15, 1913. SIR: I have the honor to transmit herewith a copy, together with a translation, of the agreement between the British bondholders and the Government of Guatemala, referred to in my despatch number 438 of May 13. I have [etc.] [Inclosure Translation.] HUGH R. WILSON. AGREEMENT TO ARRANGE THE PAYMENT OF INTEREST ON THE FOREIGN DEBT, AND A DECREE APPROVING IT. The Secretary of State for Foreign Affairs, in view of the sickness of the Minister for Finance, and with special instructions from the Constitutional President of the Republic for the purpose of resuming the payment of interest on the foreign 4% bonds, and Mr. Andrew Bickford, legal agent of the Council of Foreign Bondholders in London, who in turn represents the holders of the above-mentioned 4% bonds, have agreed on the following points: 1. The Minister for Finance will hand to the Agent of the bondholders, as soon as possible, the certificates for the payment of the coffee export duty referred to in article 9 of the contract of July 11, 1895, in sufficient quantity to cover the current interest of the debt for the year 1912-14, so that the resumption of this income can be made effective from the 1st of July of the present year. Preference will be given these certificates and no other lien on the coffee exportation tax will be admitted until those which apply to the foreign 4% debt have been paid off. 2. To substitute for the certificates issued under the contract of November 18, 1898, the Government of the Republic will proceed without loss of time and in accord with the Council of Bondholders at London, to issue new bonds to the total value of £29.656 with the corresponding coupons, beginning with that which belongs to the half year ending December 31, 1901; and will give the necessary instructions to its London diplomatic representative for the exchange and other acts. 3. The Government will also issue deferred certificates distinct from those mentioned in the former articles, which will not earn interest, for an equal sum to that of the past and unpaid interest up to the 30th of June of the current year, and will give orders that these be handed over to the Council of Bondholders in London as soon as possible to take the place of the coupons. 4. The bondholders agree to suspend for four years, counting from July 1st of this year, the recovery of the £15,000 which by virtue of Article 6 of the contract of July 11, 1895, ought to be paid to the amortization account of the debt. 5. At the end of four years the Council will treat with the Government as to the manner of the amortization of the deferred certificates mentioned in article 3 of this agreement. Done in duplicate in the city of Guatemala, May 10, 1913. LUIS TOLEDO HERRARTE, PALACE OF THE EXECUTIVE POWER, Having seen the agreement made on the 10th of this month between the Minister for Foreign Affairs, because of the sickness of the Minister for Finance, and Mr. Andrew Bickford, agent for the Council of Bondholders of the 4% foreign debt, to arrange the payment of interest, and finding it in accordance with the instructions communicated to that effect, The Constitutional President of the Republic decrees: That he approves the five articles of which the mentioned agreement is composed, and that the part referring to the payment of the above-mentioned interests shall be made a part of the General Budget. Let it be published. ESTRADA C. Because of the sickness of the Minister for Finance, and the inability to be present of the Minister for Foreign Affairs, the Minister for Government and Justice: J. M. REINA Andrade. President Tancrède Auguste died on the 2d instant. Congress will convene today to elect his successor. FURNISS. File No. 838.001 Au 4/5. The Acting Secretary of State to the American Minister. [Telegram-Paraphrase.] DEPARTMENT OF STATE, The President has sent to the Secretaries of State in Council assembled the following telegram: I deeply regret to learn of the death of President Tancrède Auguste. I extend to you, the Government and the people of Haiti the deep sympathy of the Government and people of the United States of America, and my own sincere condolence in the national loss sustained by your country. Pray extend to Mrs. Auguste the sincere personal condolence of Mrs. Wilson and myself. WOODROW WILSON. Instructs him to supplement the above by an appropriate communication to the Foreign Office expressing the sympathy of this Government and especially of the Secretary of State. MOORE. File No. 888.001 Au 4/7. The President of Haiti to the President. [Telegram.] PORT AU PRINCE, May 5, 1913. I thank you as well as the people of the United States and beg you to thank Mrs. Wilson in behalf of Mrs. Tancrède Auguste for your condolences. The country is very thankful for your high mark of sympathy. MICHEL ORESTE. File No. 838.00/710. The American Minister to the Secretary of State. [Telegrams-Paraphrases.] AMERICAN LEGATION, Port au Prince, May 5, 1913. Senator Michel Oreste was elected President by Congress by a majority of forty-eight votes. The President elect is a lawyer and is pro-American. Instruction requested regarding recognition of the new President. FURNISS. File No. 838.00/711. AMERICAN LEGATION, Port au Prince, May 5, 1913. The President was legally elected, order prevails and the members of the Cabinet seem to be favorably disposed towards American influence. Instruction desired in regard to recognition. File No. 838.00/719. FURNISS. AMERICAN LEGATION, Port au Prince, May 12, 1913. The American Minister will be invited to attend the Te Deum Mass on the 14th instant in honor of the election of President Oreste, and to attend a reception after the Mass. Being Dean of the Diplomatic Corps, which will attend these functions, his absence there from would be injurious to American influence. Attendance at these functions signifies recognition. Asks instructions. File No. 838.00/719. FURNISS. The Secretary of State to the American Minister. [Telegram-Paraphrase.] DEPARTMENT OF STATE, The Haitian Legation in this city has not notified the Department of the death of President Auguste or of the election of his successor, President Oreste. But if the Government of Haiti has officially informed you that President Oreste has been elected in accordance with the Constitution of Haiti you may attend all functions connected with his inauguration. File No. 838.001 Or 3. The Minister of Haiti to the Secretary of State. [Translation.] BRYAN. LEGATION OF HAITI, MR. SECRETARY OF STATE: I have the honor to transmit herewith, with office copy, an autographic letter' by which Mr. Michel Oreste Not printed. |