814.6463Em7/18: Telegram

The Chargé in Guatemala (Thurston) to the Acting Secretary of State

My May 24th, 6 p.m. Mr. Catlin has just informed me that last night he signed a lease contract with the Guatemalan Government whereby his company acquires the Empresa Electrica in rental for 10 years at $40,000 per annum.22 At the end of this period his company may renew contract on the same terms. Mr. Catlin seems well pleased with these conditions and assures me Government will sell plant outright within a year and that the contract grants his company preferential rights of purchase.

Please refer to my despatch number 642 dated November 5th, 191823 last paragraph; under article 1 of decree 742 the Guatemalan Government made full provision for the uninterrupted possession of this plant and I am inclined to doubt its intention of ever selling it outright.

While President Cabrera yesterday formally assured me the other enemy properties taken over by the Guatemalan Government will soon be put up for sale, I do not believe they will be sold since some means probably will be devised of making the terms of purchase unattractive to foreign capital.

In conclusion I respectfully report to the Department that it is the general opinion among foreigners well informed and managers [?] experienced in Guatemalan affairs that President Cabrera will only comply with any suggestion or request emanating from Washington when he can find no [convenient] way of disregarding it.

  1. The lease was to the American Foreign Power & Light Co., a subsidiary of the Electric Bond & Share Co.
  2. Not printed.