825.51/1214: Telegram

The Ambassador in Chile ( Bowers ) to the Secretary of State

85. Department’s 72, April 30, 3 p.m. My view is that the corporation has authority to borrow money in its own name under its general powers as a corporate entity and also under paragraph 1 article XXII of Law 6334. However, as indicated in my despatch No. 424, April 5,28 there is grave doubt whether it has such control over the revenues provided by Law 6334 as will ensure without question its ability to repay the funds it may borrow; until decrees such as No. 781 are reissued in terms to give it more autonomy as regards dollar revenues. [Page 684] Revision of the law eventually is desirable but the legislative branch is now controlled by party enemies of the regime who in view of coming elections would not contribute to economic betterment, thus it does not seem practical now.

Bowers
  1. Not printed.