811.516 Export-Import Bank/8–2048: Telegram

The Secretary of State to the Embassy in Chile

confidential

317. Board Directors Eximbank Aug 18 considered application Fabrica Victoria de Puente Alto for credit $2 million to finance purchases US equipment services for expansion of its plant in Chile for production and spinning rayon filament yarn and staple fibers. Eximbank concluded that credit $1.2 million would be ample to meet company’s needs and be a loan which company could repay without undue burden. Board approved credit this amount to be repaid in 5 years with interest 4½ percent. Credit to be covered by unconditional guarantee [Page 430]Bank Chile as to repayment principal and interest with satisfactory exchange assurances to be given by appropriate Chile Govt agency.

Board also approved request by Machine Affiliates Inc on behalf of group Amer machine tool and other manufacturers for credit to assist financing sale $650,000 worth machine tools cranes and foundry equipment to Manufacturera de Metales (Mademsa). Purchasers to pay 25 percent cash and Amer exporters to participate in financing to extent another 25 percent. Eximbank to finance balance about $375,000 to be repaid in about 3½ years with interest 4½ percent. Credit to be guaranteed by Bank Chile and dollar exchange to be assured by Govt Chile.

Dept refers to statement urtel 545 Aug 121 that “apparent past policy not make govt loans to private enterprises”. This has never been policy Eximbank. Bank prepared at all times to consider on their merits applications from private enterprises. The facilities of Eximbank are open to US exporters to US importers and to foreign govts the agencies of foreign govts and foreign firms and nationals.

Marshall
  1. Not printed.