The Ambassador in Brazil ( Morgan ) to the Acting Secretary of State

No. 1494

Sir: The two enclosures to this despatch contain a translation of the portion of the Annual Message to Congress, delivered on May 3rd, of the Acting-President of Brazil,16 relative to the construction of a new naval base and the summary of an interview on that subject which the Minister of Marine gave a representative of the Jornal do Brazil subsequent to the publication of the said message.

These two extracts indicate that the construction of the arsenal is one in which the Government is deeply interested. This is relative to the proposal of Vickers-Armstrong, a translation of which was forwarded to the Department in my despatch No. 1324 of July 22nd, 1918, and which the Department subsequently informed me had been handed to the Bethlehem Steel Company for study.

[Page 215]

If American corporations intend to take part in this construction they should lose no time in giving the matter their earnest attention. The presence in Brazil of Mr. William S. Barclay, the representative of the Federation of British Industries, is undoubtedly connected with the Vickers-Armstrong proposition from which we may expect to hear again at any moment.

I have [etc.]

Edwin V. Morgan
[Enclosure 1—Translation]

Extract from the Annual Message of President Pessoa to Congress, May 3, 1919

It is impossible to have an efficient marine without properly equipped and situated naval bases. Our resources do not permit us to solve this problem entirely but we should not delay in erecting the first of such naval bases—which should be the most important of a series—possessing a capacity to meet the requirements of our fleet, in any emergency, in order to avoid the necessity of our applying to foreign establishments for help. We shall not require large sums of money for this purpose for we should give to our Arsenal an industrial character and adopt therein a financial system whereby a moderate interest on the capital would guarantee the sums spent on erection; the shops ought to be self supporting when not in actual operation for the Navy. It would be wise, also, that facilities should be given to the Arsenal to produce iron and steel, thus placing the producing and consuming plant side by side.

The expense of this undertaking will bring in as good returns as any of the public works. Our Arsenal would be in a position, in war time, to supply us with the entire necessities for our naval defense; in peace time its activities would be directed toward the greater progress of the country, by the construction of merchant ships, locomotives, rails, etc., thus reducing expenses in order to effect the payment of the guaranteed interest above mentioned. Military defense would thus be allied to economic defense, war industries to pacific enterprises—and this problem would be solved in a manner which would correspond to the present necessities of the world situation and to our actual financial situation. The yearly expense would not greatly exceed the sum which we expend at present on our naval installations.

Great discussion has arisen over the locality of this base, the general idea in naval circles being that it should be away from Rio de Janeiro. In the beginning of the year the Minister of Marine, desiring to find out the opinions of the admirals on this point, in order to obtain fop the government the advice of experts, called [Page 216] a meeting of the Council of the Admiralty. At this session [over] which he presided, it was unanimously decided that this naval base should not be constructed in the port of Rio de Janeiro; a large majority voted for its construction in the Ilha Grande bay.

There are many reasons, besides military ones, why this situation should be adopted. There are many waterfalls on the island which could be made to supply power sufficient for the entire plant; we would thus not have to depend on foreign coal. Another advantage lies in the fact that it is connected by railways under construction (and other[s] authorized but not actually under construction) with the regions producing iron and manganese—which facilitates the plan of operating referred to above.

It has been exclusively owing to the reduced appropriations of the budget that our equipment has become as inadequate as it is; perhaps it would be more correct to attribute this inadequacy to the lack of proper shops and yards which would permit us to turn to better account the sums voted to the Navy.

As long as we leave this problem—of the construction of naval bases—unsolved, and do not make a start in this direction by building the first of a series of arsenals, the efficiency of our fleet will be materially impaired.

[Enclosure 2—Translation]

Interview with the Brazilian Minister of Marine (Alencar) published in the “Jornal do Brazil,” May 6, 1919

We are absolutely dependent upon other countries for equipping our naval defense and are less advanced in this respect than were the Portuguese settlers in colonial times. These possessed Naval bases at different points along the coast. There were Navy Yards in Para, Pernambuco, Rio de Janeiro and Santos which were prepared to make the needed repairs. Today, we have a more up-to-date fleet, but we lack the necessary equipment for its upkeep. It is essential that we possess the means to manufacture readily any piece of machinery or make any repair that a “dreadnought” may need.

It is with this in mind that we are formulating plans for establishing five Naval bases along the coast. We are in sore need of such bases. The Naval Staff are carefully studying the grounds before determining upon the sites. Rio de Janeiro, it is agreed, shall not be included among these bases, for in time of war the enemy could there cripple the fleet as well as control the port and seize the seat of Government. Although this will be an undertaking [Page 217] of magnitude, it does not necessarily involve the expenditure of large sums by the Government. The latter will simply assist private capital to establish these bases. With a guarantee of a certain dividend upon the amounts invested, it should not be difficult to interest men of wealth and ability. These concerns would have the privilege of engaging in the exploitation of ores and the construction of merchant ships, or of following any other industrial pursuit. Thus in time of war, the necessary equipment for the maintenance of the fleet would be available while in time of peace these bases would serve their purpose economically.

These naval bases will be under the direct supervision of the Government with the proviso that they may be taken over later if so desired.

This plan will mean economic and industrial progress in the country and provide for the construction of a merchant fleet, of locomotives and everything which pertains to iron and steel. Some of us may object on the ground that we have no coal, but such conclusions do not appear logical for we have iron and manganese ore, and we simply need to import coal to transform these raw products into manufactured articles.

  1. Dr. Epitacio da Silva Pessôa.