812.6363/5586: Telegram

The Ambassador in Mexico ( Daniels ) to the Secretary of State

78. President Cárdenas issued statement March 18th, in summary it was that the Government of Mexico stated at the time of expropriation its intention to indemnify justly said companies and later to endeavor to find a way to satisfy interests of companies. That Richberg proposed a plan of collaboration for the development of the industry the companies contributing toward such association the amount of the indemnification for their properties and also the new amount which they are disposed to invest. The Government will direct the directive and administrative functions conceding representation to the companies in proportion to their investments which will be on a lesser scale than the investments of the Government. The Government is in possession of data to fix the valuation of the expropriated properties. The duration of the plan of collaboration et cetera will be “once the companies accept the principles and bases proposed by the Mexican Government”.

Associated Press wired full statement night of March 18.

President Cárdenas spoke today before some 40,000 people, a smaller crowd than was expected. He spoke of the fundamental laws Mexico and touched upon the reason for dispropriation of the oil companies and spoke of the precedent they established in taking their fight to foreign courts. He stated that the companies had recently assumed an entirely different attitude. Spoke of the attacks upon the Government by its enemies saying that he was endeavoring to save Mexico from the clutches of imperialism and to grant freedom to Mexico’s workers. Referred to his statement of March 18 saying that the companies had proposed a plan of collaboration and briefly outlined it. There was no applause from the crowd during this period of the speech.