718.1915/735 Supp.: Telegram
The Secretary of State to the Minister in Panama ( South )38
82. Department’s telegram number 70 dated November 10, 3 p.m.39 and number 71 dated November 11, 4 p.m.40
The Panaman Minister has advised the Department that Fabrega has recently conversed with Casorla41 and he feels very hopeful that Costa Rica might be willing to settle the boundary dispute by establishing the line as set forth in Department’s telegram number 71 dated November 11, 4 p.m. The Panaman Government, therefore, has instructed him to make a formal proposal to President Jimenez to that effect.
From conversations with the Costa Rican Minister—who is uninformed regarding Fabrega’s conversations with Casorla and other Costa Ricans on this point—it appears that this proposal would not be acceptable to Costa Rica, and if it should be accepted, Congress would probably not ratify it because it would not ratify any instrument giving up territory unless Costa Rica received other territory of approximately the same area in return. It would be most unfortunate if Costa Rica and Panama were to conclude another agreement which would not be ratified; this would leave the matter in a worse state than at present. Oreamuno42 has received instructions from Costa Rica that it would be willing to conclude a convention providing for the demarcation of the boundary in accordance with the awards and would suggest as Arbitrator the Chief Justice of the Supreme Court of the United States. According to Oreamuno this means a submission to arbitration of the claims of each side against the other. As stated by Alfaro, Panama would be willing to settle the boundary on the lines stipulated in the awards, and to arbitrate the amount of the indemnity due Panama from Costa Rica. In short, Costa Rica would have to agree in principle to an indemnity. Oreamuno says that this is out of the question, but that should he be informed that Panama would accept, he would be willing to employ all his influence—and he thinks he would succeed—to induce Costa Rica to accept a solution on the basis of the convention providing for the demarcation of the boundary according to the awards, the matter of indemnity to be submitted to arbitration, Costa Rica [Page 480] agreeing, so as to secure a settlement of the boundary. Should the Arbitrator find Panama to be at fault, Costa Rica would agree to waive, in advance, all claims for indemnity. Should Costa Rica be at fault, the Arbitrator would set the amount of the indemnity.
On its face this offer seems reasonable, conciliatory, and eminently fair. Discuss the matter orally and informally with the President and the Foreign Minister and determine if some such arrangement cannot be agreed upon as affording once for all a satisfactory settlement of this long-drawn-out dispute. Telegraph results.