800.51 W 89Yugoslavia/56
The Minister in the Kingdom of the Serbs, Croats and Slovenes (Dodge) to the Secretary of State
[Received March 7.]
Sir: Referring to Mr. Paddock’s Despatch No. 2494 of November 20th last,86 relative to his further efforts to obtain the confirmation desired by the World War Foreign Debt Commission of certain assurances given by the Yugoslav Debt Mission to the effect that no action would be taken by the Yugoslav Government with respect to any of its indebtedness heretofore or hereafter incurred which would result in placing the United States in a less favorable position as a creditor than that which it now occupies, I have the honor to inform you that I have not failed to keep this matter in mind and to inquire from time to time about it in my conversations with the Ministers for Foreign Affairs and of Finance.
To-day in the course of a conversation with Dr. Stojadinovitch, the Minister of Finance, I again drew his attention to my note of May 15th last, which embodied your telegram No. 14 of May 13, 6 p.m., and to the many assurances which I had received from him and his predecessor, Dr. Mehmed Spaho, as well as from Dr. Nintchitch, the Foreign Minister, and his predecessor, Mr. Voja Marinkovitch. Dr. Stojadinovitch excused himself for not having replied sooner, referring to his numerous absences and to the recent elections, and stated that he had lately been considering his reply. He would now immediately study the question with Dr. Nedelkovitch, the former member of the Yugoslav Debt Mission who was now in Belgrade, and would send me a reply within a few days.
I then inquired as to whether his Government might be expected soon to make some definite proposals to my Government looking to the refunding of the indebtedness of the Yugoslav Government to the Government of the United States. In this connection I referred to the statements made to me by Mr. Marinkovitch, the Foreign Minister in the preceding Cabinet, Despatch No. 2463 of September 26th last,86 to the effect that such proposals would soon be presented. Dr. Stojadinovitch replied that he had also given attention to this matter and that his Government desired to make a definite proposal as soon as possible and that he expected to do so during May or June next. I then inquired why his Government required so long a time in view of the long delay which had already elapsed since Mr. Marinkovitch’s promise. Dr. Stojadinovitch replied that [Page 184] the British Government were pressing him to propose some plan for the payment of the bond for £1,880,000 which was due last month (Despatch No. 2462 [2463] of September 26, 1924) and that he had promised to make such a proposal during May or June. He thought it only proper that the two proposals should be made about the same time. There was however another reason for his wishing to delay somewhat and this was because he considered that as France was a much wealthier and larger nation than Yugoslavia, the latter should not submit its proposal first but wait until France had done so. However this view would not cause any real delay since he understood that the French Government had already made some tentative proposals.87
I then inquired whether he could give me any idea of the proposals which he would make and he replied that they would probably be substantially similar to those proposed by the French Finance Minister, M. Clémentel, with whom he had lately talked in Paris, and would include a moratorium, say of ten years, and then payments extending over a considerable number of years at a very low rate of interest. Dr. Stojadinovitch did not consider that it would be necessary to send another debt mission to Washington, except possibly to settle the final details. Negotiations could be conducted through this Legation or the Yugoslav Legation in Washington. In this connection I may refer to the views of Mr. Marinkovitch regarding a funding plan, described in my Despatch No. 2463, above referred to.
While adding that I shall continue to keep the matters above reported in mind and report any further developments, I have [etc.]