800.51W89 Hungary/78
The Hungarian Minister (Széchényi) to the Secretary of State
Sir: I have the honor to refer to my note of May 12th, 1932, No. 227/Res,58 advising you that my Government has authorized me to sign, on its behalf, the agreement concerning the suspension of the payments due to the Government of the United States from the Royal Hungarian Government during the fiscal year 1932.
Upon instructions from the Royal Hungarian Foreign Office, I have the honor to bring to your attention the following:
Paragraph I of the above agreement provides that the amount, payment of which is postponed thereby, is payable with interest thereon at the rate of four per centum per annum in ten equal semiannual instalments beginning with the fiscal year 1933–34.
When my Government had this agreement under consideration, it felt that the interest rate of four per centum was too high and that a fair and equitable rate would be three per centum per annum. With regard to the payment of the semi-annual instalments, my Government, in view of the adverse economic conditions prevailing in Hungary, has found it would be more desirable to commence [Page 628] these semi-annual payments with the fiscal year 1935–36, since an appreciable improvement in conditions can hardly be expected in the fiscal year 1933–34.
The Royal Hungarian Government contemplated initiating negotiations with the Government of the United States with a view to altering the terms of the agreement in the sense outlined above. It has reconsidered taking such steps and has decided to sign the agreement in the form as stipulated by the United States Treasury. The Royal Hungarian Government expects, however, that should the Government of the United States at any time grant to another debtor nation more favorable terms for the repayment of the amount postponed under the so-called moratorium, the same terms and benefits will be extended to it also.
I would greatly appreciate the favor of an early reply in order that I may advise my Government accordingly.
Accept [etc.]
- Not printed.↩