837.51/1561: Telegram

The Chargé in Cuba (Reed) to the Secretary of State

37. Embassy’s telegram 22, March 24, noon. I have just received a very long note from the Cuban Secretary of State in reply to the letter which Ambassador Guggenheim addressed to the President on March 24, 1933, in regard to proposed issue of deferred payment certificates. This note asserts that no obligation devolves upon the Cuban Government under article II of the Permanent Treaty to give previous notification to the Government of the United States [Page 568] of its decision to assume obligations or submit them to the approval of any authorities other than those required by the Cuban constitution; that in the past it has assumed many obligations of a similar nature without the slightest obligation on the part of the United States; that these certificates and similar certificates the issue of which is apparently in contemplation are not public debts or peremptory obligations and are really in conformity with the treaty since they are designed to avoid claims. There follows a justification of the issue authorized by the decree of March 13 and a review of the Cardenas Port Works Concession and of the legislation pertinent thereto.

Summing up the note states:

“Since my Government is obliged by law to continue certain works which, moreover, are of the greatest utility to a large community, especially in this critical period; since there exists a special fund for this purpose which is affected only temporarily by other obligations, since it is not possible to carry the works to a conclusion as slowly as collections are received, and since my Government must pay a net amount, my Government has believed it within its sovereign acuities to perform an act of good administration by finding, in agreement with the contracting company, a form of deferred payments for the work that has been done and that will be done in the future without contracting any other obligations than that of paying with funds included in the ordinary budget each [year] proceeding from revenues expressly destined for works of this kind.

The Cuban Government is pleased to furnish the foregoing explanation but it desires to affirm that it is not obliged to do so by any treaty or convention and that it does not desire that this shall be considered as a precedent obligating it to similar action in the future, for otherwise not only would Cuba’s right as an independent nation be impaired but it would be impossible for her to govern.”

Unless otherwise instructed I shall hold this note pending arrival Ambassador Welles.