821.51/2384: Telegram
The Under Secretary of State (Welles) to the Secretary of State
[Received October 2—2:30 a.m.]
34. Department’s 31. Thank you for the careful consideration given to the Colombian and Peruvian requests for financial assistance. I am completely in accord with your general analysis. We have explained the situation fully to the Colombian Foreign Minister and to Dr. Esteban Jaramillo in main substance telling them that except for possible advance against gold the only immediate assistance that could be given pending additional authorization by Congress would be modest Export-Import Bank financing. We have told them we were authorized to convey the willingness of the Government immediately to enter into discussion of the purpose, terms, form et cetera of such an advance and would be willing to undertake these discussions either with their representative in Washington or through a special representative [Page 512] that we might send to Bogota. The delegation said that they would consult their Government as to whether to proceed in Washington or in Bogota and inform us.
We raised the question of the present default in Colombian dollar bonds following in our exposition the general policy summarized in our 31. Feis explained that we could not give definitive [definite?] expression to position that would be taken in the matter but he said that his best personal guess was that the government would be willing to work out a modest emergency financing through the Export-Import Bank without asking as a condition the execution of a debt settlement but that it would probably ask for a definite reaffirmation by the Colombian Government of its intention of seeking and executing a reasonable settlement. He said further, again making clear that it was merely his best personal judgment, that when and as subsequent to grant of new authorization by Congress the discussions enlarge themselves, this Government would feel that a settlement of the private debt question was most important. He based these opinions on the feeling of the bondholders and the sentiment in Congress.