The Chargé in Peru (McGurk) to the Secretary of State
[Received 8:19 p.m.]
184. The Ministry of Finance informed us that Beltrán is now negotiating with the Export-Import Bank for credit of $13,000,000 to support exchange. He stated that reserves now amount to $1,200,000 over and above the $2,000,000 credit granted last June and that it will not be possible to maintain the sol at its present rate much longer. He said that with exports declining sharply especially since the Japanese have stopped buying cotton there was no sources of exchange likely to relieve the situation which would continue to decline and that the credit he was asking would secure the sol at its present level until the latter part of 1941.
Considering that the reserve fund now amounts to the appreciable total of $1,200,000 over and above the $2,000,000 credit which has not been touched no reason is seen for hasty action without reference to such a large credit. It will be recalled that his request of last June for $5,000,000 was satisfied by a grant of $2,000,000 at a time when circumstances were as uncertain as they are at present.
Further report by air mail.