882.51/1907: Telegram
The Chargé in Liberia (Clark) to the Secretary of State
[Received November 22—11:40 p.m.]
The President has requested me to transmit to the Secretary, in the Department’s code, the following personal message:
“Taking advantage of the courteous invitation extended me when in America by Secretary Hughes, which invitation was renewed by Mr. Castle to Secretary of State Barclay last year, to communicate with you informally on matters of mutual interest to our respective countries I desire to apprise you that the present loan negotiations have reached a point where only two serious questions remain unsettled. These are article 15 and article 25.
Through having no representatives of the bankers here and because of the death of Colonel Crews it appears that our position is not clearly appreciated. In order to present the loan for passage at this legislature it is necessary to act with the least delay and present it in form that will insure least opposition.
Referring to article 15, Finance Corporation cablegram of November 16 says last December,62a referring to communications between Liberian and American State Departments on economic development of Liberia, that Liberian Government by not accepting articles 15 and 25 offered by corporation ‘has now come to suggest terms which permit Liberia at her option to change this policy’ and ‘suggested departure … might seriously affect whole plan of American investment in Liberia.’ It is clearly impossible present this communication to officials here as meaning of telegram read as a whole will be interpreted by Legislature as intending to compel Liberia to agree [Page 570] never to refund loan and conveying to their understanding a threat of imperialism. Our objection to power of Financial Adviser in clause as insisted on is: (1) arbitrary power to block legitimate loan; (2) Financial Adviser refusing his approval beneficial loan will be subject to charge that his refusal, and therefore other official acts, is based on instructions, thus embarrassing both Governments. Or Financial Adviser may advance [apparent omission] comes to approval of loan which is contrary to present policies and thus destroy the reason for this clause, as intimated by the corporation.
The executive government will accept definite commitment not to refund for 12 years and agree to incorporate in any refunding loan the objective as set forth on page 1 present draft. Further, to only negotiate refunding loan with established responsible financial concern or bankers and to give the Finance Corporation first option on taking refunding loan on same terms as such concern or bankers may offer.
Referring to article 25, Legislature has approved in Firestone planting agreements an arbitration clause which preserves the dignity of the Republic of Liberia and gives Liberian Secretary of State wide range of action. Similar clause in article 25 loan agreement can be passed without comment or difficulty. As now written article 25 increases the difficulty by reopening discussion and, further, as the general public has never understood or desired loan, it might be utilized by administration’s political opponents as allegation that arbitration clause is ecmivalent to unnecessary surrender of control of foreign country. We suggest addition to article 25, line 6, after word ‘themselves’ the following: ‘themselves the Government of Liberia agrees to arrange with the United States Department of State for the further arbitration of the question or questions in dispute and the decision arrived at in such further arbitration shall be final and binding’. Similar commitment in planting agreements I understand is not objectionable to American State Department. May I request you to use your good offices to bring about better understanding and appreciation of our position as present impasse if continued may indefinitely postpone the realization of a long desired objective. Message ends”. Signed King.
- The words “last December” were apparently inserted by error or are in improper order.↩