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  4. Document 1350

711F.1914/7–2044

Memorandum by Mr. Robert G. McGregor of the Division of Caribbean and Central American Affairs

[Washington,] July 26, 1944.

The attached reply of the War Department27 to our inquiry concerning its attitude toward the present removal of the railway station in Panama is based on a lengthy quotation, a statement of the [Page 1437] Governor of Panama Canal with which the Acting Secretary of War acknowledges his concurrence.

(1)
The Governor states that he is not satisfied with the survey made by former Governor Edgerton. He has ordered another survey.
(2)
It is at present impossible to estimate the amount of post-war railway traffic the station will have to handle.
(3)
In view of the scarcity of labor, materials and shipping space, now is not the time to embark on any construction that is not immediately necessary.
(4)
The Governor advances hypothesis that previous agreements between the United States and Panama have not settled the matter as to who is to pay for the new station. The Governor reasons that the Panama railroad could not be reasonably expected to pay for the removal of the station which is a convenience to Panama.
(5)
In summary, the Governor and the War Department recommend that the removal of the station “be postponed until a time to be agreed upon later, subject to the termination of the war, and that the State Department be requested to give further consideration in the meantime to the manner of financing the project when it is undertaken”.

I have been through the record of the discussions which led to the 12 point agreement of May 18, 1942, and I fail to find any mention as to who is to pay for the new station or the manner by which its removal is to be financed.

I would very much appreciate the views of Mr. Duggan concerning this matter in view of his acquaintance with the discussions which led up to the agreement of May 18.28

  1. Not printed.↩
  2. In a memorandum dated July 28, 1944, to Mr. Cabot and Mr. McGregor, Mr. Duggan expressed the view that it was implicit in the nature of the arrangement that the United States was to pay for the removal of the station, and he recommended that the cost of building the new station be shared equally by the two Governments (711F.1914/7–2044).↩