The Secretary of State to the Ambassador in Mexico (Morrow)
418. Department’s No. 415, July 16, 6 p.m.7 Mexican Ambassador was orally informed by Under Secretary8 yesterday that Department did not consider that it could justifiably agree to modification of General [Page 439] Claims Convention of September 8, 1923 as suggested by the Mexican Government, without the approval of the Senate. Ambassador was informed that Department entertained doubts as to whether the Senate would favorably consider such modification and that public discussion regarding modification at this time was considered unwise. The Ambassador contended that the Mexican Government would be unable to make immediate payments with respect to judgments of the Commission touching the value of property expropriated and that Mexican Government did not wish to make an undertaking which it could not fulfill. He stated that it was virtually impossible for the Mexican Government to restore the property taken in lieu of immediate compensation in cash as envisaged by Article 9 of the General Claims Convention. Tellez was reminded that it would probably be some time before the Commission could again function and that other obligations which have been contracted by the Mexican Government such as interest payments on Mexican Government bonds might not be met on dates stipulated; consequently while the Department is in sympathy with the principle actuating the Mexican Government’s position, it does not share the Mexican Government’s fears as to the effect of the language in the Claims Convention.
The Under Secretary informed the Ambassador, however, that with a view to giving all possible consideration to the Mexican Government’s position he would communicate with Mr. Clark on the latter’s arrival in Mexico, inasmuch as Mr. Clark is very familiar with matters relating to the Claims Commissions. As the Ambassador contends that the Mexican Government’s desire to amend Article 9 is due principally to financial considerations, Department would be glad to have your comments as to relation between the question of “immediate” payments of awards covered by Article 9 and the general question of Mexican Government finances. (See second paragraph Department’s telegram No. 415.) The Under Secretary made it clear to the Ambassador that there was practically no likelihood of the Department’s acceding to the Mexican Government’s request for modification.