823.51/4–346: Telegram

The Acting Secretary of State to the Ambassador in Peru ( Pawley )


308. Vidal83 called recently at Bondholders Council office with written authorization to invite and urge Council to send a representative to Lima immediately to discuss possible changes in plan for Peruvian bond settlement. Council April 3 telegraphed Minister of Finance84 that Rogers is absent and no other officer of Council available, adding following comment with which Department fully concurs:

“We do not see how the Council could possibly acquiesce in changes in the plan which would make it less attractive to the bondholders. The plan now gives to the bondholders less than any arrangement which the Council has hitherto recommended in the case of any other country. We consented to it only after the most careful consideration of all the factors involved and after fullest discussion with representatives of the Peruvian Government regarding Peru’s financial situation and balance of payments. We believe that a reduction in the proposed service would cause a much larger proportion of the bondholders to reject it, thus defeating the main purpose which we both have in view, namely, the satisfactory adjustment of the debt and the consequent restoration of Peru’s credit.”

Please support Council’s firm attitude in endeavor to expedite definitive Peruvian action.85

  1. Carlos Vidal, President of the Peruvian Amazon Corporation.
  2. Manuel Vásquez Diaz.
  3. Ambassador Pawley in telegram 492, April 24, 1946, 3 p.m., reported that President Bustamante had given assurances that Congress would approve the debt settlement at its next session (823.51/4–2446).