824.154/8–1147: Telegram

The Acting Secretary of State to the Embassy in Bolivia


475. For Flack from Eximbank. Urtels 72651 and 729. Bank believes it timely to reaffirm its position regarding highway. Bank at no time has insisted upon McGray–Warren in preference to other United States contractors, but feels changing contractors at present stage of highway job and without full justification may well cause confusion, delay and additional cost. Bank felt decision of Corporation Board on revised contract would give McGraw–Warren necessary controls and at same time hold contractor to rigid progress schedule and cost estimate, and would provide for inspection by P.R.A. If under revised contract McGraw–Warren proves incapable a change might then be [Page 355] justified. Eximbank feels immediate action should be taken by Government and Corporation Board to avoid further costly delay in carrying highway to completion. Request you consult President Hertzog to determine Government’s immediate course of action. Following confidential. Bank feels possibly any further financing under credit should be suspended until these matters are settled. Advise if in your opinion such action would tend to hasten a solution. [Eximbank.]

  1. Not printed.