No. 343.
Mr. Biddle to Mr. Fish.

No. 100.]

Sir: I have the honor to transmit to you herewith an official statement of the receipts and expenditures of Salvador for the fiscal year 1872.

The national indebtedness amounts to nearly a million and a half dollars, which forms a heavy incumbrance after the prostration to commercial activity, resulting from the late wars, and the present depression in the indigo market. Coffee alone continues active, with high prices.

The stagnation in business is increased by the unsettled conditions of Guatemala and Honduras. Salvador continues tranquil, but the conflagration of civil disturbance so frequently extends from state to state that its apprehension checks commercial enterprise.

The late treaty with Guatemala calls for Salvadorean troops in aid of that government when assailed, and the relations with President Avias of Honduras are yet more intimate, so that all seem linked to a common fate.

The reactionary spirit doubtless also exists here, but it remains silent and smouldering, and will not become dangerous except through contagion from the adjacent countries.

Troops have been sent to the frontiers to check demonstrations, and the government is confident in the hope of continued peace.

I have, &c.,