837.51 Public Works Debt/147: Telegram

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

124. For the Under Secretary. Senator Casanova called to say that he attended a meeting at the President’s Palace day before yesterday attended also by the President, Colonel Batista, the President of the Senate, the President of the House, Senator Casabuena, the Secretary of State and the Secretary of the Treasury, at which the Secretary of State announced that Ambassador Martinez Fraga had informed him that Warren Brothers and Purdy & Henderson had agreed to accept payment in unallocated bonds of the series exchanged for public works bonds in the amount of 59% of the principal of their claims. It was agreed that prior to Colonel Batista’s departure for Washington26 a bill would be prepared and presented in the Senate, with the signatures of the President of the Senate, Senator Casabuena and Senator Casanova providing for such settlement and providing for settlement with the Cuban contractors in bonds of a junior issue with a junior lien on the revenues pledged for the service of the bonds exchanged for postal bonds.

Senator Casanova said the Secretary of State reported that Ambassador Martinez Fraga will bring a final memorandum on the subject when he returns to Habana tomorrow.

Senator Casanova said he was informing me of the foregoing because he feared there might be some mistake in the figure of 59% since he had understood that both American creditors had held out for 80% (see enclosure 3 to my despatch 1228, October 1827).

Neither Crafts nor Brownson has informed me of any change in the attitude of their principals toward the settlement they are willing to make with the Cuban Government. I have not discussed this new development with them.

I did not discuss with the Senator our attitude toward the public works debt.

  1. On the invitation of the Chief of Staff of the United States Army, Colonel Batista visited Washington in November to attend Armistice Day exercises.
  2. Not printed.