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

No. 7198

Sir: I have the honor to refer to the Department’s Instruction No. 2532 of June 17, 1943,73 enclosing a copy of a translation of a letter dated May 5, 1943, from the Peruvian Finance Minister to the President of the Foreign Bondholders Protective Council; and requesting the Embassy’s comment, together with the latest available information on the likelihood of Peru’s making some early adjustment of its defaulted dollar indebtedness.

The statements of the Finance Minister in his letter of May 5 convey the same information given to me by the Minister at about the same date. Although the subject has come up in subsequent conversations, the Minister has not added anything new to his previous statements that the declining revenues in certain chapters of the Budget, together with the dislocations, or at least uncertainty, in foreign trade render it impossible for the Peruvian Government immediately to arrive at any concrete proposal for renewing service on the dollar debt. He has reiterated, however, that Peru recognizes the importance of restoring in the United States its reputation of meeting its obligation promptly. He has stated also that the Government continues to give attention to this protracted topic and plans to submit proposals at the earliest opportunity.

Respectfully yours,

R. Henry Norweb
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