822.61/144a

The Chief of the Division of the American Republics ( Bonsal ) to the Ambassador in Ecuador ( Scotten )

Dear Bob: Vicente Illingworth has laid before me a problem of some delicacy and difficulty concerning which we would all like your advice. According to Illingworth, President Arroyo is convinced that on the occasion of his visit to Washington19a he was promised by Mr. Welles20 a $10,000,000 credit for agricultural development in Ecuador, the said credit to be over and above any existing commitments. Vicente states that the President has gone pretty far out on a limb in discussing this more or less publicly since his return home.

I have gone into the matter very carefully. The fact is that neither Mr. Welles nor anyone else discussed agricultural development in specific terms with Arroyo. There was no mention whatever of any additional credit. Of course, Mr. Welles and others expressed sympathetic interest in Ecuadoran agricultural problems. It was suggested that should any projects be developed in regard to this subject they might be processed through the Ecuadoran Development Corporation which at that time appeared to have ample uncommitted funds.

We will not at this time extend a further $10,000,000 credit to the Ecuadoran Development Corporation. However, I would like to have your views as to the local situation and as to the President’s position in order that we may decide what, if anything, should be [Page 292] done. It seems to me, quite frankly, until there is developed some sort of intelligent program for the general development of Ecuadoran agriculture with particular reference to production and distribution for local consumption the mere granting of credit would not be desirable.

With warm regards,

Sincerely yours,

P[hilip] W. B[onsal]
  1. President Arroyo visited Washington November 23–27, 1942.
  2. Sumner Welles, Under Secretary of State.