838.51/1239: Telegram

The Secretary of State to the Chargé in Haiti ( Jordan )

33. For General Russell.

Your March 27, 3 p.m.

You are instructed to present the following note to the Haitian Government:

[Here follows the text of the first six paragraphs of the note transmitted to the High Commissioner in the Department’s instruction of April 1, infra.]

It is desired that the Haitian Government make reply, reciting full terms of the above note and accepting them. You may also communicate to Haitian Government proposed draft of loan law as follows:—

[Here follows the text of the loan law draft likewise transmitted in the instruction of April 1, infra.]

Your March 23, 2 p.m. Provision 4. Department feels itself unable to accept modification of Protocol regarding bonds of National Railroad, although Financial Adviser is now prepared to discuss with receiver of road possible arrangement beneficial to Government.

Provision 5. Department has no objection to insertion of clause to this effect in note above quoted, but does not desire that loan law should contain any provisions assuming to modify the protocol.

Provision 6. Department feels that provision of protocol regarding Féquière claims clearly requires review by Claims Commission. It is unwilling that Sambour claims should be regarded as liquidated debt, feeling that they should be dealt with by Claims Commission.

Provision 7. Department considers this proposal impracticable because it would be difficult to induce some foreign claimants to accept only 50 per cent cash. Claims Commission should take into consideration total amount of cash available in awards.

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Provisions 8 and 9 appear to be answered by terms of note above referred to. Regarding agriculture and public instruction, Department feels that any expenditures of permanent benefit which could properly be made for these purposes from loan would be regarded as public works.

Provision 11. Department regards it as entirely impracticable to attempt to float loan without providing specifically for extension of customs receivership during life of loan. It is thought that bankers would not accept possible future agreement for extension of receivership as adequate security.

Other requests of Haitian Government referred to would appear to apply to loan contract. Provisions of this nature could be included in contract if Haitian Government insists, and if bankers agree, but it should be borne in mind that they might affect the price received for the bonds.

Department is gratified at Government’s willingness to pass law, and hopes that it will at once enact the law and authorize Financial Adviser to conclude negotiations. It is thought that a material improvement in price could be obtained if bonds are sold in near future.

Hughes