The Under Secretary of State ( Welles ) to the Ambassador in Peru ( Norweb )

Dear Harry: It is now almost one year since David Dasso was in Washington.64 While we are agreed that the results of that trip have been satisfactory, the perennial Peruvian debt question is apparently no nearer a solution than it was a year ago. You are, of course, thoroughly familiar with all of the details of this situation but I would like to recall the statement in the press release of April 23, 1942 concerning Dasso’s visit which refers to the debt: “He has also stated that he is engaged in discussions with the Foreign Bondholders Protective Council, Inc. looking towards a resumption of payments on the Peruvian dollar debt”.65 Despite this assurance, practically no progress has been made.

I think it is now time for a very frank talk with President Prado.66 I think you should tell him that the continued failure of the Peruvian Government to live up to its promises and to make any reasonable offer to the bondholders cannot help but adversely affect the friendly and cooperative relationship which has been so painstakingly built up between our two countries and which we all, of course, will do everything to maintain. It seems to me that the question can be put up to the President in a very firm way in view of the relatively good financial position in which the Peruvian Government now finds itself.

With my kindest personal regards,

Sincerely yours,

Sumner Welles
  1. At the time of his visit Dasso was Minister of Finance and Commerce. For an account of his negotiations, see Department of State Bulletin, April 25, 1942, pp. 365–368.
  2. Ibid., p. 366.
  3. Manuel Prado Ugarteche, President of Peru.