The Minister in Ecuador (Long) to the Under Secretary of State (Welles)

Dear Mr. Welles: Dr. Aurelio Mosquera Narvaez, the President of Ecuador, invited me to the Presidential Palace this morning and received me with the Minister for Foreign Affairs.

The President briefly referred to the efforts of his administration in taking steps which would improve the handling of public affairs, adding that he thought some of the worst influences had been eliminated and hoped now to be able to make substantial strides forward. In addition he stressed the fact that the Banco Central, Ecuador’s Bank of Issue, was being re-officered and a new Board of Directors would soon be installed from whom it was reasonable to expect a proper administration of the bank’s finances which eventually would [be] reflected in its improved position.

The President added that he had been impressed with the policy of Washington in seeking some practical manner in which to aid the countries that worked with it: that Ecuador had seen with approval the aid extended in the case of Brazil1 and that Ecuador would like to do several constructive things, but before being able to do them would need a loan of possibly as much as ten million dollars. He asked if I would confidentially convey this suggestion to the Department and then let him know how the Department was impressed with the intimation he had made.

I told him I would be pleased to send an airmail letter today which should reach Washington next Monday morning conveying his message, but that there were several ways of approaching such a matter. One would be for the Government to make a financial statement outlining such plans as it might have under contemplation, another would be to invite a Financial Counselor to come down, look over the field and prepare a statement; but I hesitated to suggest the latter method because it was my impression that on a previous occasion when a financial [Page 597] adviser had been here some disagreements had arisen at a time when Mr. Boniface2 was then as now an important figure in the banking world.

The Foreign Minister, Doctor Julio Tobar Donoso, broke in and said he knew of the matter to which I referred, but that the incident had its explanations for the adviser who was furnished by the Kemmerer Commission3 was by some regarded as theoretical. At least it was a case where the two men did not get along.

The President said he was sure that if the Department favored the idea some practical method of working out the details could be found.

I regretted that we had no phone to Washington as it would be easier to talk the matter over with you, but promised that I would write today without fail.

While I realize that insufficient information is hereby furnished with regard to the use of the proposed loan and while also aware that Ecuador’s record with respect to bonds has been somewhat unsatisfactory in the past, I would appreciate hearing whether there is any possibility of this matter receiving serious consideration should more exact data be obtained.

The individuals in the present Government are a high class lot of Ecuadoreans, filled, I believe, with the best of intentions and it seems now that they are pretty well set in the saddle; yet judging from the past they might be succeeded by a less capable group.

Very sincerely yours,

Boaz Long
  1. See pp. 348 ff.
  2. Neptali Bonifaz, chairman of the Board of Directors of the Central Bank of Ecuador.
  3. American Commission of Financial Advisers headed by Edwin W. Kemmerer, Princeton University professor, 1926–27.