740.00112a European War 1939/29679

The Ambassador in Venezuela (Corrigan) to the Under Secretary of State (Welles)

Dear Mr. Welles: Dr. Parra Pérez80 today requested that I write to you regarding the desire of the Venezuelan Government to purchase the railroad which runs from Valencia to Caracas. This is normally and legally a Spanish-owned company but the majority interest is known to be German. The heavily interested Spaniard has a Venezuelan wife. The Venezuelan Government desires to obtain the railroad by purchase since any other more summary procedure would raise an issue with Spain, a neutral country with which Venezuela has consistently maintained close and friendly relations regardless of the transitory character of its recent Governments. If they took over the property they would then have to submit to an evaluation which the Minister thinks would reach or exceed 50 million Bolivars, whereas it could probably be bought for around 5 million Bolivars in free Spanish exchange.

In a few words, the Minister wants our help in getting a bargain for the nation. A balance must be struck between the evil of leaving this important strategic railroad in Axis hands and the evil that would come from allotting to the owners the amount of free exchange [Page 830] required for outright and immediate purchase. The funds would most likely remain in Spain or Venezuela as a hedge against post war conditions on the part of the owners.

Could an exception be made in funds control in this case in view of the other important considerations?

Sincerely yours,

Frank P. Corrigan
  1. Caracciolo Parra Pérez, Venezuelan Minister for Foreign Affairs.