No. 285.
Mr. Phelps to Mr. Frelinghuysen.

[Extract.]
No. 83.]

Sir: Yesterday I had the honor to telegraph you concerning the rupture of negotiations between Chili and Bolivia, and the protest of Bolivia against the continued occupation of the Mollendo-Puno Railroad, by Chilian forces. Puno, upon Lake Titicaca, is, or was in communication with the Bolivian side by means of small steamers. These were seized by the Chilians, and all commercial intercourse with Bolivia by that route interdicted.

Besides, the Chilians carried one or more torpedo boats by the railway to Puno, and are otherwise prepared for aggressive warfare, from that railroad terminus and lake port, upon Bolivia. It is not reasonable to suppose Chili is disposed to give up this great advantage until peace is secured with Bolivia.

As this now seems to be in peril—and I may add there are indications of movements of Chilian troops upon Bolivia in the south—at this moment, the forces would not be withdrawn from Peru, were it demanded by General Iglesias.

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I have, &c.,

S. L. PHELPS.