Chargé Hutchinson to the Secretary of State.

No. 423.]

Sir: I have the honor to report that I was present with the ladies and gentlemen of the diplomatic corps at the reading of the message to Congress by General Castro at 4 p.m. on the 1st instant. * * *

The message—copy and translation inclosed—contains several points of interest to the United States. * * *

I have, etc.,

Norman Hutchinson.

Extracts from the message of General Cipriano Gastro, Provisional President of Venezuela, to the National Congress of 1905.

In our foreign relations the Venezuelan Government has maintained the greatest harmony and good friendship with all the nations with which it has relations, to the extent to which the respective representatives have so desired.

Thus we see that our relations of friendship with Great Britain, Germany, Italy, France, Chile, Netherlands, Belgium, Spain, Argentina, Brazil, Sweden and Norway, Nicaragua, Guatemala, Panama, Salvador, Mexico, the United States, etc., have been relatively cordial.

In order to maintain these relations on so good a footing, the Venezuelan Government has not failed to accede to the desires of the respective representatives as far as justice, equity, and right are compatible with the dignity and honor of the nation.

On the other hand, the government has taken pains to fulfill the obligations which it has contracted, and, in accordance with these obligations, which are diplomatic compacts, the peremptory demands were first paid to the allies and afterwards, in conformity with the sentence of The Hague tribunal, recognized as arbitrator by all the claimant nations, 30 per cent of the customs receipts of La Guaira and Puerto Cabello were paid.

In this regard there will be no further grounds for change, for once the payment of the allies is completed the pacific claimants will continue to be paid honestly and fairly from the aforementioned 30 per cent, in conformity with the arbitral award.

Since it was clearly and positively stipulated in diplomatic compacts that the remaining debts of the Republic which did not come under the head of claims should be paid within a reasonable period, for which purpose the respective creditors were to reach an understanding with the Venezuelan Government by means of new agreements concerning the form of payment, the Venezuelan Government, being desirous of proceeding to make these agreements, sent Gen. José Antonio Velutini twice to Europe for this purpose, conferring on him the necessary authority to conclude the arrangements.

I have the satisfaction to announce to you that these agreements have already been concluded and signed by the contracting parties and that the agreement relating to the discount debt has been ratified by the German Government, and that it will also soon be ratified here. Our commissioner, General Velutini, is only awaiting the ratification by the English Government of the agreement concerning the debt or loan contracted with that nation some years ago in order to return.

This operation, which I consider as being definitely concluded with the German and English bondholders, is, in my opinion, of great magnitude and importance, for on it depend, in part, the credit, tranquillity, and good harmony of Venezuela with other nations.

The Venezuelan Government has, then, fulfilled and is fulfilling everything which its representative, Mr. Bowen, agreed upon by means of diplomatic protocols with all the nations with which Venezuela had matters pending settlement.

If, as I hope, the ratification to which I referred should take place before your session of this year is terminated, I shall at the proper time request admission to you in extraordinary session in order to relate to you in a special message the real extent and importance of the operation.

We have had a slight difference with the Government of the United States of North America from causes beyond our control and for which we are not in the least responsible, [Page 1038] and our chancellery has discussed the matter in a luminous manner, which appears to have explained the truth of the facts to said government, judging from the measures which it has recently adopted in behalf of our good and cordial friendship.

These matters are that of the Bermudez, or Asphalt, Company and that of the Orinoco Company, already determined by the respective arbitrators, in conformity with the protocols concluded by the aforesaid Mr. Bowen, who demanded that it be taken into consideration by a new court of arbitration. To neither of these demands could the Government of Venezuela accede, since the sovereignty and independence of the Republic were involved, although the government has always made it a rule in its policy with all countries to preserve the greatest cordiality and good friendship.

Our official relations with the government of our sister nation, Colombia, have not yet been able to be resumed, as was our desire, in spite of the fact that the relations of friendship with the Chief Magistrate of that nation have remained unchanged.

The cause has not lain with the Venezuelan Government, as those who ought to know are well aware, viz, those who have had a part in so serious a matter.

Nevertheless, I cherish the hope that these official relations will soon be resumed, as is demanded by our common interests, our common glory, and the future of both nations, the whole matter being governed by a spirit of equitable reconciliation, in accordance with the facts in this case.

It is proper in this connection to mention the decisive, important, honest, frank, and impartial assistance which the arbitrator recognized by both parties, Mr. Francisco Herboso, minister of Chile in this city, has lent toward a successful continuation of the negotiations.

So that, in venturing to hope, as I do, for a successful solution, I am influenced by the fundamental belief that intrigue can no longer place an obstacle in the way of so noble a purpose.

* * * * * * *

Cipriano Castro.