711F.1914/752

Memorandum by Mr. Murray M. Wise of the Division of the American Republics51

Relocation of Railroad Station in Panama City

I had a talk with Governor Edgerton this afternoon regarding the above subject. He stated that of course the Railroad could not consider moving the station during the emergency, but added that if he were properly approached by the Panamanians he would be glad to proceed with a survey of the proposed site. He said the cost of the survey will run into several thousand dollars, a sum which the Railroad Company will pay if it is finally decided that this is not a cost which can justifiably be charged to the Panamanians. He said that he would resent very much a request asking for a survey of the site at our expense, since he prefers offering to pay the cost only after he has asked the Panamanians to do so and has been told that they desire to avoid this expenditure. In other words, he wants the Panamanians to feel that our paying this cost is not an obligation, but rather wants it to be considered as another definite gesture or concession on the part of this Government. This puts the Governor in a better light and may better his bargaining position on some other phase of this negotiation.

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The Governor states that he believes that the site being offered by the Panamanians is a good one and is acceptable when considered in relation to the Trans-Isthmian Highway, the Inter-American Highway and the international airlines. He believes that if the survey turns out as he believes it will, we can say to the Panamanians that the site will be acceptable if properly prepared (improved) by the Panamanians at their expense. This preparation will include filling, grading, building proper approaches (streets), and installing water and sewer facilities. The Governor further believes that negotiations can then be entered into for the purpose of determining the conditions which will control the transfer when it is made after the war. These details, among others, will include disposition of the land now occupied and the sale of the buildings on the present site.

I believe the foregoing is more or less what Mr. Duggan had in mind. The Governor believes that if we are approached again by the Panamanians we should state that these decisions rest principally with the Canal Zone authorities and that they should be approached through our Embassy at Panama. In other words the Governor feels that the “ball” is down there. The Governor expects Dr. Fábrega to get in touch with him again after he has discussed the matter fully with the Panamanian Minister of Finance.

  1. Addressed to the Chief and the Assistant Chief of the Division of the American Republics.