File No. 819.77/162.

The American Minister to the Secretary of State.

No. 372.]

Sir: Referring to my despatch No. 341 of February 24 last, I have the honor to inform you that I have not yet received the statement which, as mentioned therein, President Porras said that he would send me as to the attitude of the Panaman Government in this matter. Upon referring to this lately to Señor Lefevre, Minister for Foreign Affairs, he stated that the Government were awaiting the return in a few days of Dr. Valdés, Panaman Minister at Washington, in order to question him as to his telegram reporting that the Department of State had no objection to a pledge of the interest of the fund of six million dollars (see my telegram of February 22.)

I enclose in this connection a clipping1 from the “Gaceta Oficial” of the 4th instant, containing the text of this law as passed by the National Assembly, which it will be noted is identical with the bill, the text and the translation of which were enclosed in my despatch No. 298 of January 20th last. It will also be noted that this law was passed by the Assembly on February 18 and not on February 17, as stated to me by President Porras (see my telegram of February 22), and so would seem not to have been passed when my paraphrase of the Department’s telegram of February 17 was received by Señor Lefevre.

I take this opportunity to enclose a copy of the aide mémoire which I handed to Señor Lefevre on the 1st instant, after communicating to him the substance of the Department’s telegram of February 28.

I have [etc.]

H. Percival Dodge.
[Page 1104]

aide mémoire.

The American Minister stated that he had received a reply from his Government to a telegram which he had sent informing it briefly of the substance of the views expressed by His Excellency the President at the interview which the American Minister had with His Excellency and his excellency the Minister for Foreign Affairs, on the 22nd ultimo.

This reply stated that the American Government obviously entertained the desire that the railways of Panama should develop and prosper and that it would neglect no proper endeavors which might conduce to this result. Just as obviously however the American Government considered that it was bound to caution the Panaman Government against any use of this annuity payable in accordance with Article 14 of the Treaty of 1903 and of the fund of six million dolars invested in New York which might be ill-advised or unwise. It was the opinion of the American Government that the discounting of these future revenues of Panama would be imprudent.

The American Government would not be willing to agree to the future installments of the annuity above referred to being pledged. This was outlined in the American Minister’s communication to his excellency the Minister for Foreign Affairs, F. O. No. 71 of June 3rd, 1912. It has always been plainly manifest from the beginning of the negotiations first with the Colombian Government afterwards with the Panaman Government that the purpose of the interested Governments was through the annuity to constitute a fund by which a permanent revenue would be assured for maintaining on the Isthmus a stable Government. A similar purpose was also provided for by the permanent investment of the fund of six million dollars in New York.

  1. Not printed.