No. 108.
Mr. Scruggs to Mr. Frelinghuysen.

No. 103.]

Sir: On the 26th ultimo, the Government here made an official announcement that it had concluded a negotiation, by telegraph, with the Panama Canal Company at Paris, for a loan of half a million dollars for two years, at 6 per cent. per annum, without any security or guarantee whatever. The following is, however, the only part of the telegraphic correspondence that is made public, which I translate as follows:

Paris, July 25, 1883.

Mr. Minister of Finance: I am happy to inform you that, confiding in the traditional fidelity of Colombia, our company places at your disposition, agreeably to your desire, and upon the conditions of interest and repayment specified, the sum of half a million dollars.


The Government claims, moreover, that this loan is wholly disconnected with, and independent of, the previous agreement by the company to pay $50,000 per annum for the maintenance of an armed force of 300 men along the line of the canal works, and that it is likewise independent of the proposed reclamation by Colombia against the canal company, resulting from the company’s purchase of the Panama Railway.

* * * * * * *

Both the French minister and the resident agent of the canal company here disclaim any knowledge of this loan or even of the existence of any negotiations concerning it.* * *

I have, &c.,