Memorandum of Conversation, by Mr. Willard F. Barber of the Division of the American Republics

Participants: President-elect Lescot of Haiti;
Minister of Foreign Affairs Dennis;
Dr. Bressman;
Mr. Fennell;27
Mr. Bonsal;
Mr. Finley;
Mr. Collado;
Mr. Barber.

Mr. Lescot opened the discussion by suggesting that under point five of the bases for discussion it might be possible to work out a detailed system of accounts in the National Bank of the Republic of Haiti for the communes. Each commune would have a special account and its budget and expenditures would thus be subject to a certain amount of supervision by the Bank and by the national government.

President Lescot then went on to the question of payment on the bonds and the expenses of the bank. He suggested that if there were a surplus in any one month over the budget expenditures and one-twelfth of the annual payment for the bonds, the directors of the Bank would decide what portion of the surplus to set aside in order to establish reserves for lean months and what portion to set aside [Page 337] for additional amortization payments. M. Lescot also suggested that the directors of the Bank might fix the global budget and that subsequently transfers could be made by the different departments of the government according to exigencies that might come up. He added that he felt that certain items which had previously been annually budgeted, such as traveling expenses for the president, allowances for the celebration of national holidays, et cetera, might well be omitted from the regular budget and when such expenditures would be needed they could be made from the reserved funds mentioned above.

Comment: Although M. Lescot made a very attractive presentation of this idea, it might be considered as the opening wedge in the breakdown of the regular budget system.

Mr. Collado commented that the question of transfer of accounts within the global budget was a matter of bookkeeping details and appeared to allow for a certain amount of flexibility. He saw no objection to it in principle, nor to the setting up of reserves in good months which should ease the situation when seasonal fluctuations in government revenues appeared.

President Lescot then mentioned the additional $500,000 which the Haitian government expected would be made available for a continuation of the J. G. White projects. Messrs. Bonsal and Collado pointed out that the directors of the Export-Import Bank had not yet passed on the $500,000 and while it was hoped that favorable action could be obtained there was nothing definitive to be said on that point today.

M. Lescot then reviewed the question of the construction of tourist hotels and the advantages that would accrue to Haiti in the event of an increased tourist trade. At this juncture he repeated his suggestion that a highway be constructed from Môle St. Nicolas to Cap-Haïtien and that this route, continued to Port-au-Prince and connected with a highway to the Dominican frontier, would permit tourists to make a tour of the island. Mr. Fennell stated that as he understood it, the J. G. White program already had plans for an expenditure of an additional $250,000 for road building if the additional $500,000 were made available. Mr. Fennell stated that if the proposed agricultural corporation should develop rubber some additional feeder roads would be needed in the rubber producing areas.

M. Lescot said that he had been reading in the press about defense activities of the United States in other islands of the Caribbean and to him it was “shocking” that apparently the United States was taking no defense measures in the Republic of Haiti. He would like to find out what the defense program of the United States would have in store for his country. Mr. Bonsal replied that this matter was being [Page 338] studied but that there was nothing to be said about it at the present time beyond the fact that approximately $200,000 was going to be expended in the improvement of Bowen Field.

Mr. Bonsal suggested that the Department might issue a statement which would cover in principle the following points:

An agreement to revise the Accord of 1933 and to terminate the Office of the Fiscal Representative;
An extension of an additional credit by the Export-Import Bank; and
An agricultural plan emphasizing the optimistic prospects, based on recent surveys, of rubber production.

After MM. Lescot and Dennis left a further brief consultation was held in which it was agreed that Dr. Bressman and Mr. Fennell would prepare the section of the statement which would deal with agricultural plans, and would prepare a more detailed memorandum which could be handed to M. Lescot before he left the country.

Mr. Collado felt that it would be necessary to get Mr. Jesse Jones’28 approval of the statements regarding the agricultural plan as well as the Export-Import Bank credit. Mr. Finley expressed as his opinion, which was concurred in by Mr. Collado, that the matter of the hotel construction and management should be developed further, although they did not see the necessity for some of the road building plans that M. Lescot had proposed. Mr. Barber suggested the possibility that the statement might take the form of a White House press release, or a joint statement issued by Presidents Roosevelt and Lescot.

  1. T. A. Fennell, Agricultural Adviser to the Haitian Government.
  2. Federal Loan Administrator and Secretary of Commerce.