811.51/5964: Airgram

The Minister in Costa Rica ( Scotten ) to the Secretary of State

A–507. Reference the Department’s A–122, October 8, 7 p.m. and [Page 101] my A–235, November 21, 10:35 a.m.22 The Costa Rican government has finally agreed to block the Italian government funds held by the Spanish Minister here,23 and presently amounting to $141,895.25. The dollar funds will be converted into colones, and the colones will be kept in a blocked account under the control and supervision of the Junta de Custodia.24 No withdrawals from such account will be made in the future without previous application to, and approval by, the Junta. The Costa Rican government, however, has told the Spanish Minister that upon proper application, monthly withdrawals of small amounts, not exceeding 250 or 300 colones in toto, will probably be authorized for the subsistence expenses of some Italian subjects who reside here and who are completely without other means of subsistence. This, of course, is not strictly in keeping with the provisions of Resolution I of the Inter-American Conference on Systems of Economic and Financial Control,25 and this fact has been brought to the attention of the Minister of Finance,26 who has explained that failure to permit such payments will impose upon the Costa Rican government the burden of providing the indigent Italians with subsistence funds, since it has been indicated by the Spanish Minister that his government would not provide the funds from other sources. The Minister of Finance has stated, however, that such payments will be kept to a bare minimum, and that each case will be decided on its merits. In view of the Costa Rican government’s previous reluctance to block these funds, since they were held in the name of the Spanish Minister and there was no documentary proof of their Italian ownership, the present procedure can be regarded as substantially satisfactory from our viewpoint, in spite of the divergence from the procedure recommended in the Washington Conference. It is believed, further, that now that the ice has been broken in this regard, it may be easier in the future to secure a more strict adherence to the recommended procedure. In this connection, it may be noted that the Costa Rican government has no funds in Italy, so that it would be impossible to secure reciprocal treatment for the payment of subsistence expenses of Costa Rican citizens there.

In accordance with the procedure outlined in the Department’s airgram A–122 of October 8, 1942, it is now desired to know whether the dollar funds in question may be remitted to the United States by the Banco Nacional and credited to its account there. In this regard, it should be borne in mind that one of the strongest arguments that [Page 102] was made to the Costa Rican government authorities to induce them to block these funds was that the dollars would not be accepted in the United States unless the equivalent in colones were blocked here. An early reply is requested.

  1. Neither printed.
  2. Angel de la Mora y Arenas.
  3. Costa Rican Alien Property Custodian Board.
  4. Held in Washington, June 30–July 10, 1942; for a summary of the resolutions of this Conference, see Foreign Relations, 1942, vol. v, pp. 58 ff.
  5. Carlos M. Escalante.