838.51 Cooperation Program/10–245
The Chargé in Haiti (Abbott) to the Secretary of State
[Received October 10.]
Sir: I have the honor to supplement my telegram no. 317 of September 29, 6 p.m.34 reporting President Lescot’s reactions to the Export-Import Bank’s proposed consolidation of Haiti’s Public Works Loan of 1938 (J. G. White) and the Shada loan.
After he had acquainted himself with the contents of my note setting forth the proposal (a copy of which is enclosed herewith)35 the President expressed his disappointment at the non-inclusion in the plan of the 1922–23 Bonds. He then referred to the provision relative to the additional payments on bond amortization to be made from savings resulting from the reduction in amortization on the White loan, pointing out that if the savings effected through the consolidation were only to be devoted to amortization on the Bonds, the principal purpose of his request for Haitian debt consolidation would be defeated, i.e., no funds would be available for the productive public works so necessary to Haiti’s future and economy. With reference to the withdrawal of the Bank’s representative from Shada’s Board of Directors, he said he did not favor this, but if the consolidation was carried out, he would agree.
During the interview Mr. Lescot continually reverted to the subject of the Bonds, emphasizing that they were his chief concern and that the high rate of interest was a heavy burden for such a poor country as Haiti. He pointed out that payments in interest and amortization already substantially exceed the original debts, with $7,000,000 at six percent still outstanding.
In spite of his continual digressions, a trait well known to those familiar with him, on the burden of the Bonds, his confidence in Mr. Pettigrew and his determination to iron out all differences and to let nothing hinder friendly Haitian-American relations, the President indicated that the consolidation was agreeable to him. It is my impression, however, that before it will be accepted by the Haitian Government certain points, such as the amount of additional payments [Page 1106] expected on the Bonds, will have to be clarified, and that an effort will be made to secure some modification of their terms. I also gathered that the President proposed to communicate at once with Minister Lacroix who, as the Department is aware, is at present in the United States.
With reference to the Bank’s telegraphic instructions to Mr. Pettigrew, transmitted in the Department’s telegram no. 329 of September 26, 6 p.m.,36 I am transmitting herewith a copy of the latter’s letter to Mr. Wayne C. Taylor,37 President of the Bank, which would appear to be an appropriate enclosure to this despatch as it sets forth his impression of the President’s reception of the proposed refunding scheme, which concurs with mine, as well as his reasons for not holding a Shada stockholders meeting at this time.
This despatch has been held over one day, as I had hoped that perhaps the Foreign Minister, with whom I had an appointment, might have had something to say on the subject; he, however, made no reference to it.