The Chargé in Nicaragua (Damson) to the Secretary of State

No. 438

Sir: I have the honor to report that President Sacasa spoke to me at some length yesterday about his aspirations for extension and improvement of communications in Nicaragua.

His most important topic of conversation was the proposed Inter-American Highway. The President stated that he felt that this would be a bond of the greatest value for the furtherance of real Pan Americanism, of which he had ever been one of the most sincere and tireless exponents. He said, however, that in studying the copy of the report on the reconnaissance survey of the Inter-American Highway through Central American countries delivered to his Government by the Legation (the Department’s instruction No. 81 of May 28, 19349), he had reached the opinion that the proposed route through Nicaragua could be improved upon.

Doctor Sacasa remarked that he realized that the engineers who undertook the survey had undoubtedly considered all possible routes carefully and chosen that which seemed best to them with due consideration [Page 474] of all factors bearing on the advisability of one location over another but that he thought undue stress had probably been laid on ease of construction rather than the opening up of regions now inadequately served by roads and railroads. He pointed out that the route described in the report paralleled the existing Pacific Railway and was consequently not as useful as another might be.

He said that he hoped it would eventually be possible to locate the Nicaraguan section of the highway so as to pass through Nandaime, Jinotepe, Diriamba, Managua, Tipitapa, Matagalpa, Jinotega and Ocotal instead of through Nandaime, Granada, Masaya, Managua, León and Chinandega as contemplated in the reconnaissance report (It is believed that these routes can be easily traced on maps in the Department’s files). This would give two important portions of Nicaragua, the Sierra coffee district south of Managua and, of greater moment, the Matagalpa–Segovia region in which Sandino and his bands had operated, adequate means of communication with the Managua–León–Granada center of the Republic, the principal cities of which are now connected by rail, whereas the suggested route would merely duplicate, for the most part, existing rail facilities.

The President pointed out that the route he mentioned would not be materially longer than that recommended by the reconnaissance survey report, that, in his opinion the added cost entailed by the more difficult nature of the terrain would be justified by the increased benefits received, and that it would enable the placing of Tegucigalpa on the main line of the Highway instead of on a feeder thereto as contemplated by the report. He said that he felt the economic development of the Segovias which would result from opening them up would serve to do away with the poverty and ignorance which had made that region such an easy prey to bandit movements; furthermore, the existence of a modern highway through them to replace the difficult mule trails by which they are now reached would make their control and policing a simple matter.

It is obvious from Doctor Sacasa’s remarks that they were based on the premise that a large share of the cost of the Highway would be borne by the Government of the United States. He said that he had tried to get funds to construct a satisfactory highway from Tipitapa to Matagalpa since the beginning of his administration and had twice succeeded in interesting American companies but that on each occasion a catastrophe, the explosion of the arsenal at the Campo de Marte on August 1, 1933, and the assassination of Sandino on February 21, 1934, and the resulting political uncertainty had aroused their caution.

President Sacasa also spoke of his hopes that a railroad to connect western Nicaragua with the Caribbean coast “where we have vast and untouched resources” could be built at some time in the near future. [Page 475] He stressed the need from the Nicaraguan point of view of bringing that “remote region into intimate contact with our culture” and remarked that unfortunately Nicaragua does not have financial resources to make this dream a reality without aid. The President stated that he hoped it might eventually be possible to secure a loan in the New York market for the purpose although he gave no indication that any démarches to this end had been undertaken.

Doctor Sacasa then mentioned the advantages which he thought such a railroad would have for the United States in “giving it another means of communication across Central America, since I realize that the Nicaraguan Canal is probably not an immediate possibility in view of the crisis.” He apparently did not take into consideration the fact that there are already three transcontinental railroads in Central America, in Panamá, Costa Rica and Guatemala. I consider the President’s ideas concerning the proposed Atlantic Railway largely chimerical although there seems to me to be much to be said for his thoughts in regard to the location of the Nicaraguan section of the Inter-American Highway.

Doctor Sacasa explained that he was doing his best with the limited facilities at the Government’s disposal to improve and extend existing roads. He referred in particular to plans for the building of a road from Chinandega to Nacascolo, a port on the Estero Reál, leading into the Gulf of Fonseca, which the Government intends to develop, and to improvement of the Managua–Tipitapa road and other roads in the vicinity of the capital. From my own observations, the latter efforts seem largely ineffective as the “improvement” consists of filling in ruts with soft dirt. As the roads have no proper bed or crown heavy rains quickly make them again practically impassable.

Respectfully yours,

Allan Dawson
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