No. 30.
Mr. Hall to Mr. Frelinghuysen .

No. 156.]

Sir: The President of Guatemala has issued a decree relative to the construction by the Government of a railroad from the port of Santo Tomas, on the Atlantic, to this capital. I inclose copies and translations thereof, and of an appeal which he makes to his people for cooperation.

From the 1st of January, 1884, a personal tax of $4 will be imposed on every Guatemalan having an income of not less than $8 a month; for this tax the payer will receive a proportionate interest in the road; the tax: will not be collected from foreigners.

The estimated capital required for the work is $12,000,000, for which 300,000 shares of stock, at $40 each, will be issued.

As a means of bringing these shares into circulation, the Government reserves a strip of the public lands, a league in width, on either side of the proposed railway, for which, when sold, the Government will receive in payment the said shares only, at 25 per cent. premium during the first five years, and at 30 per cent. premium thereafter.

A board of three directors will have charge of the execution of the work and of the administration of its funds. The board will enter upon its preliminary labors as soon as its members shall be appointed.

The President appeals to the patriotism of his countrymen to cooperate with the Government in carrying out this enterprise, destined, he believes, to bring progress and civilization with it.

The motives of the President are praiseworthy beyond a doubt; but it is too soon to venture an opinion as to the probability of a realization of the project to which the decree relates.

I have, &c.,

[Inclosure 1 in No. 156.—Translation.]

Decree of the President of Guatemala relating to the construction of a railroad from Santo Tomas to Guatemala City.

Decree No. 297.

I, J. Rufino Barrios, general of division and constitutional President of the Republic of Guatemala, considering:

That the construction of a railway which, starting from the port of Santo Tomas, on the Atlantic, should connect with the line leading to the Pacific, is a work of the greatest importance and transcendency that could be undertaken in favor of the civilization, aggrandization, and wealth of the nation;

That on the opening of that road depend the development of agriculture in the extensive and most fertile lands of the north; the active development of the natural products of all kinds in which they abound; the augmentation of population by the current of immigration from the north, which the very execution of the work would provoke; and finally, the incomparable development of commercial business and of general traffic by way of the territory of the Republic between sea and sea;

That the Government, persuaded of the great necessity of the country for that road, has not ceased to exert itself to furnish it, granting privileges and ample concessions, which, although justified by the importance of the object, would nevertheless entail a costly sacrifice of interests and a quasi dependence of the country on the foreign company that should take charge of accomplishing it;

That, notwithstanding the concessions and privileges which to assure the future of [Page 71] the Republic the Government was disposed to grant, it was not possible to effect a solid and convenient arrangement concerning the construction of said railway;

That by means of the favorable situation reached by the public wealth and the most extensive distribution of it to-day, it is possible to carry into effect the patriotic idea, pleasing to all, of executing the great work of the railroad to the north tional resources; and to execute it, not only without greater burdens or for the contributors, but with positive benefit to themselves or to their inheritors and successors, who would come to enjoy the benefits of the enterprise;

That, apart from this, the Republic would obtain an immense advantage in the simple fact of freeing itself from the necessity of making an outlay four times greater, and of subjecting itself to the most onerous recourse of concessions and privileges if the work had to be done by a foreign company, which consideration should weigh heavily with the patriotism of the Guatemaltecos in support of the national work; and, finally—

That to obtain the necessary funds for the enterprise, a small contingent on the part of the generality of the Guatemalans is sufficient.

Therefore, and in virtue of the faculties with which I am invested, I decree:

  • Article I. The railway which is to unite this capital with the port of Santo Tomas on the Atlantic, touching in its course the points most important for commerce and agriculture in the regions of the east and north of the Republic, shall be constructed for the account of the nation.
  • Art. II. To that effect an obligatory national tax, reduced to the small amount of $4 per year, shall be levied for the term of ten years, which shall commence to be counted from the 1st of January, 1884, on and which shall be paid by all Guatemalans who by reason of business, wages, salary, or emolument, may have a monthly income of not less than $8.
  • Art. III. The payment of the tax shall be made quarterly, $1 being paid in each of the months of March, June, September, and December of each year.
  • Art. IV. Every subscriber shall be inscribed immediately in the character of shareholder in the Northern Railway, with a right to the benefits of the enterprise in proportion to the amount of the quota he subscribes.
  • Art. V. Every individual subject to the tax, who refuses to pay the obligatory quota, shall be compelled to satisfy it, after the last day of the quarter, with a fine of equal amount, which fine shall enter the treasury of the railroad as an extraordinary receipt in benefit of the enterprise.
  • Art. VI. Foreigners resident in the country are permitted to inscribe themselves in the national subscription under the general conditions of the enterprise.
  • Art. VII. The rate being $4 per year, exceedingly small for all persons of better resources, who can in proportion easily subscribe larger quotas, they are solicited in the name of patriotism to do so, and to aid in this manner the prompter and better outcome of this grand enterprise.
  • Art. VIII. There shall be emitted 300,000 shares to the bearer, of the value of $40 each, in representation of a nominal capital of $12,000,000, which is deemed sufficient for the cost of the work. Said shares shall be divided into ten bills, each one corresponding to one year of the subscription.
  • Art. IX. To the end of giving place immediately to the commercial movement of bills becoming due, the Government reserves and destines exclusively from this time all the national lands along the railway, on both sides, and to the extent of one league in width, to be sold only in exchange for railroad bills, and in no manner for cash. In the sale of said lands the Government will receive the bills during the first five years, granting on their value a premium of 25 per cent., and one of 30 per cent, after the said five years.
  • Art. X. The shares which the Government may receive by this means shall go to the benefit of the national treasury as product of lands.
  • Art. XI. An independent directive committee, composed of three individuals, which shall operate under the inspection of the executive, shall take charge of all concerning the execution of the work of the railroad, with the representation of the enterprise and administration of its funds, commencing its preliminary labors as soon as the citizens forming it have been designated.
  • Art. XII. The directive committee shall cause to be published for the information of the public, every four months, a detailed statement of the situation and progress of the labors of the railroad, as well as also the balance of the accounts.
  • Art. XIII. The department of fomento is charged with emitting the regulations for organizing the commissions, collectors of the national, subscription, and other dispositions conducing to the execution of this decree.

  • Francisco Lainfiesta,
    Secretary of State in the Department of Fomento.
[Page 72]
[Inclosure 2 in No. 156.—Translation.]

J. Rufino Barrios, general of division and constitutional President of the Republic of Guatemala, to the natives of Guatemala:

Fellow-citizens: The decree issued on this date informs you of the resolution which I have adopted, with the object of carrying into effect, with the proper resources of the country, the most important work of the railway which should open to the public for its prosperity and enlargement the road to the north, which, is called for to give a quicker exit for our products; called for to promote and sustain the cultivation of immense tracts of land, to-day abandoned; called for, in fine, to bring to us over the currents of the Atlantic the progress of civilization on a grand scale.

In taking this resolution, and imposing upon you the small sacrifice of making a little annual saving, which will be returned to you with interest by the same works to which it is destined, I believe I have interpreted the national feeling which oh various occasions has shown itself in favor of this thought, which frees the country from costly sacrifices which the privileged concessions to foreign companies regularly give rise to.

The work which is going to be undertaken is not beyond our resources, and, executed for our own account, must appear to us excessively cheap when it is accomplished and we find ourselves enjoying its unappreciable benefits.

This work is the best inheritance which we can leave as a legacy to our sons, because on it depends the richness of the future, and it will be within a short time a flattering reality of the spirit and conviction which lead me to undertake it, encounter, as I hope they will, the aid and efficacious co-operation of my fellow-citizens.

The form adopted to collect the capital which the construction of the Northern Railway requires, distributing over large areas the small sum which must be paid for by subscription, is combined with the view that the poorer classes may be able to cover it easily, and at the same time that they may without effort go on forming with those small sums a saving which, on the accomplishment of the work, will be of great profit to them. The same combination is offered, so that the wealthier classes may contribute to the enterprise according to the scale of their fortunes.

To each class, therefore, I make a most urgent appeal; in the name of the future of our country, that we being inspired with the desire for its greathess and happiness, may resolutely work on this undertaking of the Northern Railway, which contains most beautiful expectations for our beloved Guatemala, of being justly blessed by generations to come, when history reminds them that they owe to the patriotic spirit of the natives of Guatemala the first passage of the locomotive from the Atlantic to the Pacific. Fellow-citizens, it will be a day of great glory and joy when the resounding whistle of steam coming from the north calls at the gates of our beautiful capital. Let us then hasten the coming of that great day by the union of our wills, of our efforts, and of our work.

Your fellow-citizen and friend,