Memorandum of Conversation, by Mr. Phil R. Atterberry of the Division of Investment and Economic Development

Participants: Robert Vergara—Fomento Corporation, Attorney
Burr Brundage—NWC
Mr. Cady—ED
Mr. Atterberry—ED

A general discussion covered the Fomento Corporation’s projects in Chile, including economic and financial aspects, i.e., Eximbank credit already authorized and Chile’s credit application pending with International Bank.

Mr. Vergara stated the International Bank had the application under active consideration, but that the US Executive Director was awaiting advice from the NAC. He indicated his intention to call at the International Bank within the next week or so with a view to urging final action on the application.

Mr. Vergara related that the application included the following projects:

Power (3 hydro-electric plants) $9,000,000
Timber Development 6,000,000
Trolley coaches 5,000,000
Port Equipment 2,000,000
Electrification of Railways 18,000,000

Replying to Mr. Cady’s question, Mr. Vergara observed that any indication that Chile might nationalize American-owned power plants is political talk; that such move, which would involve purchase or indemnification by Chile, would, it is believed, not be economically justified. No mention was made about other methods of nationalization, such as legislating American interests out of existence or unfair competitive infiltration in the power field by ENDESA (a Fomento Corporation subsidiary).