File No. 817.51/707.
The Minister of Nicaragua to the Secretary of State.
Washington, October 16, 1914.
Excellency: I have the honor to inform your excellency that I have received instructions from my Government to communicate to you that, after careful consultation with certain important members of the Nicaraguan Congress, the President has ascertained that it would be very difficult to obtain in Congress the ratification of the last proposed contracts with the New York bankers, Messrs. Brown Brothers and Company and Seligman and Company.
The Nicaraguan Government believes that if by a supreme effort it should obtain in Congress the approval of the said contracts, it would result only in increasing the discontent to-day existing in the country, due to its bad economic conditions. It therefore considers that it would be more advisable that the mentioned bankers, in view of the good faith with which the Nicaraguan Government has always dealt with them, agree to do without these contracts and effect an agreement with the Government respecting the sufficiency and reach of the law of moratorium, in the security that upon the expiration of the four months during which that law remains in force the Government will restore to the bankers all their rights in Nicaragua acquired through former contracts.
[Page 951]The Nicaraguan Government hopes that in the space of four months the Canal Treaty will be ratified by the Senate of the United States, and if this comes to pass it is disposed to take from the product of said treaty a sufficient amount to pay the overdue interest and, if possible, the principal of the debt to the bankers.
My Government trusts that the friendly efforts of your excellency will result in a satisfactory solution of this matter, both in the interest of Nicaragua and of the bankers, with whom my Government desires always to maintain the most complete harmony and understanding.
In anticipation I express to your excellency, in the name of the Nicaraguan Government and of myself, the assurance of our gratitude for the valued services which you have given us, and I renew [etc.]