821.51 Cooperation Program/10
Memorandum of Conversation, by the Adviser on Political Relations (Duggan)
The Ambassador of Colombia handed me the memoranda attached.96 These memoranda set forth the desire of the Colombian Government to obtain a credit from the Export-Import Bank of $13,000,000 for various types of public works and for a small addition to the capital of the stabilization fund. The Ambassador stated that, in so far as the Colombian Government could now state after a careful study of its needs, a credit of $13,000,000 would take care of all of its requirements for the remainder of the present calendar year and for the entire calendar year 1942.
Regarding terms, which are not treated in the memorandum, the Ambassador stated that his Government had heard that terms of longer than ten years were being offered to Cuba and that the Government of Colombia would like to have similar treatment; in fact, terms of longer than ten years would be necessary since the Government, [Page 67] given the debt payments it had agreed to make, would be unable to liquidate a credit of $13,000,000 in ten years. In reply to my inquiry as to what terms the Government had in mind the Ambassador said an interest rate of 3 percent and an annual amortization payment of $750,000. I told the Ambassador that no long term credit had been given for as low an interest rate as 3 percent and that I was quite certain that the Bank would not agree to an interest rate of that amount.
The Ambassador stated that he wished to make it clear that all of the public works which are mentioned in the documentation are now in process of execution. They are not new projects to be undertaken if a credit is obtained but projects which the Government, with its own funds, undertook but which cannot be carried to completion because of a reduction in Government revenues. Customs collections are now running a million pesos a month below budget estimates It has been necessary to curtail work on some of the projects and some projects are about to be temporarily halted for lack of funds. If funds become available through an Export-Import Bank credit, work could be immediately resumed.
The Ambassador also stated that the completion of some of the public buildings mentioned in the documentation was very important since rent to the value of 200,000 pesos would be saved if the Government could occupy its own buildings. The Ambassador stated that he had a tabulation setting forth the rents that the Government was now paying which would be eliminated were public buildings now under construction to be completed. At my request, the Ambassador stated that he would send a copy of this tabulation.
I told the Ambassador that the Department would give this request of the Colombian Government for additional funds its immediate consideration and would immediately confer with the Export-Import Bank. In as much as the documents he left were in Spanish, I told the Ambassador that it might be necessary to have some of them translated for the officers of the Export-Import Bank. This would take time. I stated that I hoped, however, to be able to advise him in the early days of next week of the time of a meeting between himself, officers of the Bank, and officers of this Department.
- Not printed.↩