840.51 Frozen Credits/10772: Airgram

The Secretary of State to the Ambassador in Ecuador (Scotten)

A–561. Reference your telegram no. 552, June 25, 1943. The possibility of Export-Import Bank financing for Ecuador will be discussed with officials of the Export-Import Bank. In this connection, you should consider the terms of the circular instruction of June 18, 1943,58 regarding United States financial assistance to eliminate undesirable ownership and control from Proclaimed List firms.

As is indicated in the circular instruction of June 18, 1943, it is considered desirable that local interests acquire the ownership of Proclaimed List properties which are sold. However, should circumstances warrant such a step, the Department will not object to the participation by United States private capital either on a minority ownership basis and/or a management fee basis. More extensive participation by United States capital may be approved in cases where it appears to be necessary.

It would be desirable to report the nature and extent of the outside financing which will probably be required. In regard to Saice,[Page 307]you are informed that A. E. Whitehouse and Co., Inc., of 90 Broad Street, New York City, has expressed interest. Whitehouse and Company has been informed that the policy of the Department is to favor local acquisition of Proclaimed List properties, but that if local capital is not interested, the Department has no objection to participation by the United States concern on the basis outlined above.

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