Mr. Bailey to Mr. Hay.

No. 646.]

Sir: In compliance with Department’s instruction No. 373, of the 3d instant, respecting the adjustment of the foreign debt of Guatemala, I have the honor to transmit herewith inclosed copy of the correspondence between this legation and the Guatemalan Government relative to the matter, as follows: Copy of my note to the minister of foreign affairs; reply thereto by the subsecretary of foreign affairs and translation of same; supplementary reply by the minister of foreign affairs and translation of same.

I have, etc.,

James G. Bailey.
[Inclosure 1.]

Mr. Bailey to Guatemalan minister of foreign affairs.

Sir: I have the honor to inform your excellency that I have received a note from the Department of State at Washington, instructing me to advise the Government of your exellency that, while the Government of the United States is indisposed to join in any collective act with foreign powers which might have the aspect of coercive pressure upon the Government of Guatemala respecting the payment of its foreign debt, it would reserve for its citizens equal benefits with those which might be obtained for creditors of any other nationality in the adjustment of said debt.

I embrace the opportunity to renew, etc.,

James G. Bailey.
[Inclosure 2.—Translation.]

Señor Mendez to Mr. Bailey.

Honorable Sir: I have the honor to acknowledge the receipt of your esteemed favor of the 6th instant, in which you inform me that you have been instructed by the Government of the United States to notify this Government that it refuses to unite with the other powers, collectively, against the Republic of Guatemala in the execution of acts having a semblance of coercion for the payment of its foreign debt.

I thank you for having imparted to me the views and intentions of the distinguished Government which you so worthily represent, and am pleased to reassure you of my highest respect, etc.

Joaquin Mendez, Subsecretary.
[Inclosure 3.—Translation.]

Mr. Barrios to Mr. Bailey.

Honorable Sir: Referring to the esteemed note of your excellency addressed to this office on the 6th ultimo, and adding to the reply to said note sent to your legation on the 12th ultimo, I now have the honor to manifest to your excellency that [Page 582] the Government of Guatemala willingly assents to the reservation which the Government of the United States makes of its right to claim for American creditors benefits equal to those that may be acquired by the citizens of other countries in the adjustment of the foreign debt of the Republic of Guatemala, the Government which I represent being in duty bound to accept such reservation in recognition of the friendly attitude which the United States has always assumed toward Guatemala.

With assurances, etc.

Juan Barrios, M.