File No. 817.51/375.

The Acting Secretary of State to the American Minister.

[Telegram.—Paraphrase.]

In reference to your allusion to a canal project in your February 14, the bankers have expressed their wish to know if there is any objection to inclusion of that project in their new proposals to Nicaragua. Department replied February 24 that there was none, provided that the loan contract contain the specification that there shall be no alienation to any foreign company or government except with the consent of this Government, and provided further that no trans-isthmian route shall be established without the advice and consent of this Government.

The bankers advise the Department that their representatives will be directed to drop the matter for the present if either the concession itself or the insertion of the foregoing provisos in the loan contract would endanger the latter.

Wilson.