The Secretary of State to the Ambassador in Mexico (Messersmith)
1815. Wayne C. Taylor Pres Eximbank and Antonio Espinosa de los Monteros Mex Amb to US announced following to press Dec 7.
Signing of loan agreement85 providing for line of credit $20,000,000 to assist in financing purchase in US of equipment materials and services to be used in connection with a broad electrification program in Mex. Program will be carried out by Comision Federal de Electricidad an agency of Mex Govt in cooperation with Nacional Financiera a semigovernmental Mex financial institution both of which are parties to agreement in addition to Govt Mex.
Equipment materials and services eligible for financing under credit may be financed up to their cif86 cost Mex port of entry.
Credit may be utilized at any time prior to Jun 30, 1948. Advances under credit will be repaid in 40 approximately equal semiannual installments. Interest will be at rate of 4% per annum.
Advances under credit will be secured by assignment of revenues derived from specified taxes on consumption of electrical energy in Mex as well as by unconditional guaranty of Govt Mex.
At the signing of loan agreement the Mex Amb and Taylor expressed mutual satisfaction over the continuing financial cooperation between Mex and US in promoting development of economic resources of Mex and thus facilitating trade between the two countries. It was pointed out that Eximbank has authorized credits to Mex since 1941 totalling almost $94,000,000 including the new credit of $20,000,000. These credits have been principally for highway construction and for purchase in US of gasoline refinery equipment railway equipment steel mill equipment and in the present case electrical [Page 1173] equipment. Of total amount of credits authorized approximately $17,000,000 have been utilized and approximately $4,000,000 repaid. Outstanding advances are therefore $13,000,000. Credits which may still be used amount to $77,000,000.