882.635 Neep/23: Telegram

The Secretary of State to the Minister in Liberia (Walton)

35. Personal for the Minister from McBride: My 33, November 27, 5 p.m. and your 65, November 30, 4 p.m.

After some difficulty I have been able to obtain in strict confidence from our representatives at The Hague the following definite information regarding Neep:59

“Careful inquiry indicates that Neep cannot itself finance Liberian project and that Netherlands capital cannot be induced to participate in exploiting so contrary to financial practice in this country particularly as no present interests exist here for mining properties. Muller [Page 852] and Company mentioned in memorandum is unquestionably the Netherlands firm of W. G. Muller and Company of Rotterdam which after a period of financial difficulties has recently been reorganized on sound basis with very conservative Netherlands directors who would not consider operating through an organization such as Neep muller relinquished iron mining interests in Morocco several years ago and has been endeavoring for some years to dispose of iron mining properties in Spain valued at approximately 2 million florins. Two of the best informed financial personalities both emphatic that no Netherlands capital would participate in Neep project. Neep maintains accounts with Amsterdamsche Bank but it is inconceivable that the latter would consider financially supporting former. The directors of Neep practically unknown in the leading banking circles here but inquiries reveal that they are of good repute although having no large resources here. My investigation conclusively indicates that source of any available capital is foreign to the Netherlands.”

I believe that you may consider it desirable to give the sense of this information to President Barclay in strict confidence. At the same time you may find it appropriate to discuss with him the present situation regarding colonial expansion in Africa. As you know, it is the desire of the American Government to see Liberia prosper and progress in every way. Many of our citizens are similarly interested in Liberia’s progress and independence and any developments which threaten that independence are naturally of concern to us.

You are of course aware that German leaders have made several public statements recently regarding Germany’s colonial ambitions. On October 28 Mussolini made a speech in support of German colonial demands. The German thesis is that her economic problems are inseparable from the colonial problem and that Germany must regain possession of colonial property. German leaders have made it clear in recent discussions, however, that they do not insist upon a return of the specific colonies lost during the war but that they would be agreeable to accepting territory in Africa of equal value.

In view of this situation I feel sure that President Barclay will realize the imperative necessity of giving the closest scrutiny to proposals such as those involved in the Neep concession and in the offer of a forestry expert.

You are aware that the Department has always felt that Liberian resources should be developed, in the best interest of the country, by outside capital representing a diversity of national interests, particularly those whose governments have no territorial ambitions in Africa. However, the Department has also felt that the Liberian Government should avoid granting concessions even to friendly foreign interests unless it is convinced that they are not merely speculators [Page 853] or promoters and that they possess sufficient capital and experience to work the concessions themselves. A great distinction is to be drawn between speculators and promoters who make initial surveys and then attempt to hawk a concession in the open market and serious, experienced concerns with ample capital who intend to operate a concession themselves. Our information appears clearly to indicate that Neep fails to meet the desired requirements in these respects. Furthermore, that information seems to me to leave no doubt that more study and investigation should be made before the granting of the concession is finally concluded. Under the circumstances I assume that President Barclay will conclude that the concession should not be ratified until further investigation satisfies him that Neep actually has sufficient capital and experience, is not affiliated in any way with undesirable interests, and intends itself to work the proposed concession.

If in the face of all the dangers referred to, the Liberian Government should decide to ratify the agreement, I am afraid that the question might arise as to whether the Department could continue to endeavor to assist Liberia in the improvements and reforms which President Barclay has carried out with such conspicuous success. His statesmanlike leadership has brought his country such prosperity and peace that it would be a pity to mar that splendid record by the adoption of a policy which might have unfortunate results. I am fearful also that a question might arise as to whether we should proceed with the construction of our new legation quarters. In any case the expropriation of land for the harbor basin at Monrovia may delay such construction for an indefinite period.

I believe that you would be justified in laying these considerations which are my own personal views before President Barclay, stressing our own disinterestedness and our desire for the continued peace and prosperity of Liberia, and urging upon him, in view of the active colonial demands of certain European countries, the necessity of exercising the utmost caution and consideration before granting concessions or accepting foreign advisers.

Your 66, December 3, 11 a.m., was received just after above was written. Inasmuch as we understand that President Barclay has not yet signed the agreement please bring urgently these matters to his attention so that he may satisfy himself on all points before finally and irrevocably taking action which might have such serious consequences for his country.

Please report promptly result of your conversations. [McBride.]

  1. The following quotation was taken from telegram No. 107, December 1, 3 p.m., from the Minister in the Netherlands (882.635 Neep/21).