824.51/1175: Telegram
The Chargé in Bolivia (Dawson) to the Secretary of State
[Received 8:58 p.m.]
242. Department’s 195, April 6, 5 p.m. Despite the daily promises which have been made to us for 12 days that Standard Oil payment would be made promptly no steps have actually been taken to this end so far as we can ascertain.… We are, of course, continuing our efforts and payment may possibly be effected at any time.
We respectfully suggest that (1) “stabilization” arrangement under no circumstances be concluded until Standard Oil payment is actually made, and (2) that it be made on no other basis than hypothecation of $3,000,000 gold held by Banco Central in New York as suggested in my 213, March 28, 2 p.m.
It is noted from the communication from the Acting Secretary to the Bolivian Ambassador quoted in the Department’s 195, that a stabilization arrangement with the Banco Central and the Bolivian Government is contemplated. In cases of provisions of Chase Bank loan contract of May 31, 1942 [1922], with Bolivian Government to the effect [Page 600] that Bolivia shall contract no further external loans unless certain stipulations are complied with we think a loan to the Government might be attacked legally and feel that a loan to the Banco Central direct is preferable although guarantee by Government would appear unobjectionable.