The Minister in Haiti (Mayer) to the Secretary of State

No. 206

Sir: I have the honor to refer to the Department’s telegram No. 45, of June 15, 7 p.m., with regard to a proposed Franco-Haitian commercial agreement.

I communicated the substance of this telegram both to President Vincent and the Minister for Foreign Affairs. They assured me individually that there was no reference to the 1910 loan in the proposed Franco-Haitian commercial agreement nor would any such reference be made in the accompanying exchange of notes.

I have received a letter from the Fiscal Representative’s office officially communicating to me the proposed agreement. This letter states as follows:

June 18, 1938.

“I am in receipt of a letter from the Secretary of State for Finance, submitting to this office a project of a commercial convention to be signed with France. I enclose a copy of this convention, its schedules, the letter of the Secretary of State for Finance and a study of the treaty made by Mr. T. J. Grant, Chief of Customs Control Section of this office.

There is no mention in this treaty of the 1910 loan question and I am assured by the Secretary of State for Finance and Foreign Relations that no mention of this question is to be made in this treaty. He did tell me, however, that there is to be some sort of a supplementary agreement with France which will permit a surtax on Haitian coffee of twenty-two francs per one hundred kilos, and that the French government presumably will use these funds to offer some kind of satisfaction to the 1910 bondholders. However, there is to be no mention of the 1910 loan in any supplementary agreement which may be signed.

The loss in revenue will be slightly greater than that shown in Mr. Grant’s memorandum, inasmuch as under the provisions of Article V internal taxes will not be applicable to wines and liquors imported from France. Loss of revenue from this source probably will amount to another thirty or forty thousand gourdes per year.

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I have suggested informally to Mr. Leger, and expect to repeat in my letter, that Haiti not agree to purchase a definite number of coffee bags in France each year. I happen to know that at the present time a study is being made which may result in the installation of a bag factory for use of our short fibre sisal from the south of the island. At present there is little sale for this sisal. If it could be used to make bags, a market would be more or less assured to these people. I do not intend to make this change a condition precedent to my approval, but only to ask that an effort be made to eliminate the provision under this article of the convention.

For the reasons outlined in our several conversations on this subject, I believe I should give my accord to this treaty. Before doing so, however, I should like to be informed as to whether or not you perceive any objection to this action.”

The Legation is replying to the Fiscal Representative’s office as follows:

June 20, 1938.

“I have for acknowledgment your letter dated June 18, 1938, stating that you have received a letter from the Secretary of State for Finance transmitting a project for a Haitian-French commercial convention. You state that there is no mention in the proposed convention of the question of the 1910 loan, nor will such mention be made in a supplementary agreement which will permit France to levy a surtax of Frs. 22.00 per 100 kilos on Haitian coffee imported into that country.

A memorandum accompanying your communication estimates the loss of customs revenue to Haiti at approximately Gdes. 40,000 per year, but you state that the loss of internal revenue on wines and liquors imported into Haiti from France will increase this amount by another Gdes. 30,000–40,000.

You state further that you believe you should give your accord to the proposed convention and, following the several conversations we have had on this subject, inquire whether the Legation perceives any objection to your granting this approval.

In reply, please be advised that, inasmuch as the loss of revenue to Haiti will, in all probability, be more than compensated by the opening of the French market to Haitian coffee, and since no reference is to be made in the convention or in any supplementary agreement which accompanies or is annexed to it of the 1910 loan question, the Legation perceives no objection to your granting your approval to the project.”

I understand from the Minister for Foreign Relations that it is still his expectation that the agreement will be signed before the end of the month.

Respectfully yours,

Ferdinand L. Mayer