File No. 838.51/604

The Financial Adviser to the Secretary of State

refunding the debt of haiti

To provide funds for refunding the existing debt of Haiti and to finance public improvements necessary to the development of her resources, the Government of that country has approved, subject to ratification by the legislative body, a loan of $30,000,000. A careful study of the situation indicates that such a loan could not be repaid by Haiti within the remaining period of nine years which the Treaty of September 16, 1915, has yet to run. Also it reveals that American bankers would be loath to make a loan to Haiti for a longer period unless assured of American control of finances and of the preservation of peace and order for the life of the loan.

Recognizing these facts the Government of Haiti, availing itself of Art. I of the treaty, has requested the good offices of United States to assist it in securing a loan of $30,000,000 for the purpose afore-stated, and to the end that it may be obtained upon the most favorable terms has expressed its desire to exercise the option conferred upon it by Art. XVI of the treaty, thereby insuring for the treaty a maximum life of twenty years dating from the exchange of the original ratifications. This is not a new agreement beyond the scope of the present treaty, but is simply the exercise of an option which the present treaty confers upon either party thereto. The extension requested is essential to the welfare of Haiti. Her present debts carry exorbitant fixed charges and special liens upon specific customs revenues. A refundment of these debts is necessary to curtail the annual fixed charges and permit a revision of the customs tariff demanded by the present and prospective commerce of the country. Her industries and resources must be stimulated and developed to afford employment to her people and prosperity to the country. To this end private capital is an essential factor and capital will be more readily attracted if assured of nineteen years of American control.

The advantages of the extension proposed in the protocol submitted by Haiti are mutual to both countries; I am of the opinion that its early execution is highly desirable in order that bankers may immediately be invited to submit tenders for a loan to be repaid in nineteen years, the most advantageous offer to be submitted for the approval of the Legislative Assembly which convenes in Port au Prince April next for a session of three months.

A. T. Ruan,
Financial Adviser to Haiti