The Secretary of State to the Minister in Portugal (Dearing)

No. 678

Sir: Reference is made to your despatch No. 1094, of June 4,1925, and the enclosed memorandum concerning your conversation with Dr. Alberto Xavier, of the Ministry of Finance, on May 30, 1925, regarding Portuguese Government Tobacco Monopoly 4½% Bonds of 1891 and 1896.

The position of the Portuguese Government as therein described is not satisfactory to this Government, and you are therefore requested to renew your representations on behalf of American holders of these bonds.

[Page 886]

In this connection you may inform the Portuguese Government both in writing and in person that this Government is surprised and disappointed by the reluctance of the Portuguese Government to conform to the terms of the contract which are clearly expressed on the face of the Bonds; that this Government fails to understand the motives which permit a clear discrimination in favor of British holders and which postpone consideration of this Government’s representations until a composition has been reached with the French holders of these Bonds; that such a policy does not inspire confidence in the good faith of the Portuguese Government, nor will it strengthen Portuguese credit in this country; and that this Government would appreciate a prompt and unequivocal reply in order that its course may be guided accordingly.10

I am [etc.]

For the Secretary of State:
Joseph C. Grew
  1. A note based on this instruction was presented by the Minister in Portugal to the Portuguese Minister for Foreign Affairs, Sept. 21, 1925.