814.51/580
The Chief of the Division of Latin American Affairs (Morgan) to the Assistant Secretary of State (White)
Call of Mr. Pruyn and Mr. Woolsey, representing the International Railways of Central America
Mr. Pruyn said that negotiations had been reopened in Guatemala between Mr. Price, representing the International Railways, and the Guatemalan Government looking to a settlement of the claim of the International Railways against the Government of Guatemala which now amounts to about $2,500,000. The plan contemplates the issue by the Guatemalan Government of bonds to the amount of the claim. These bonds would probably be 7% bonds at 85, with a one per cent sinking fund. However, the details had not been worked out and would be negotiated by Mr. Price. Mr. Pruyn said the Guatemalan Congress was now in session, the Government seemed to be willing to effect a settlement and the International Railways felt this was the psychological time to try and push the matter through. It was hoped Mr. Price would sign the agreement within a week or two. Mr. Pruyn said it would be a great help to the International Railways if Mr. Geissler [Page 36] could be instructed by the Department to use his informal good offices to help bring about a settlement. I told Mr. Pruyn that in advance of detailed information as to the terms of the settlement I doubted whether the Department could instruct Mr. Geissler to take any action. Mr. Pruyn pointed out that the details were just what remained to be arranged and all that they asked for was Mr. Geissler’s help to bring about a settlement which would be satisfactory to both parties. I said I would consult others in the Department and see what, if anything, we could do.
Mr. Woolsey said that he was particularly anxious to have some instructions reach Mr. Geissler, as the latter while very friendly to the International Railways and approving in general of the claim, had shown himself quite properly very loath to take even the most informal action in their behalf without specific instructions.
As the claim of the International Railways against the Government of Guatemala is of great importance and long standing, and has in principle the support of the Department, I see no objection to sending the attached telegram if you concur.9
- Telegram to the Minister in Guatemala, infra.↩