882.01 Foreign Control/686: Telegram (part air)
The Consul at Geneva (Gilbert) to the Secretary of State
[Received October 17—8:40 a.m.]
257. From General Winship. My telegram No. 256, October 14, 8 p.m.
The American representative has the honor to inform the Chairman of the Council Committee on Liberia, with the request that it be made a matter of record, that he has received from the Finance Corporation of America its acceptance of the plan of assistance to Liberia as finally revised and adopted by the Committee during its deliberations this week, and its willingness to undertake the obligations of the plan on the conditions already outlined in Mr. Ligthart’s report of June 27, 1933.83
The Finance Corporation has also been informed of the views of the Liberian Government on the question of the amount required for the ordinary operating expenses of the Liberian Government, which amount shall constitute the first priority on Liberian revenues, and of the views of the Liberian Government on the subject of funds for education. The Finance Corporation noted that the Committee was definitely of the opinion that the original recommendation of the financial expert that $300,000 was sufficient for the ordinary operating expenses of the Government, including education, for the first year, should be sustained, subject to revision by the Chief Adviser and the Financial Adviser in consultation with the Liberian Government.
In expressing its agreement with this position taken by the Committee, the Finance Corporation has asked that the American representative state on its behalf that it would be prepared on the subsequent recommendation of the pertinent officials in consultation with the Liberian Government to give its assent to the figure of $325,000 for the operating expenses of the Government, provided that the additional $25,000 should be devoted specifically to education.
The American representative points out that the Finance Corporation had already agreed to an absolute renunciation of all interest on its outstanding bonds not met during any given year from Liberian revenues after first deducting the operating expenses of the Liberian Government and the cost of the League plan of assistance including road building and sanitation and the salaries and expenses of the officials appointed under the League plan and fiscal officials. In other words, instead of receiving interest beginning with Liberian revenues in excess of $502,000 as contemplated with the figure of $300,000 for operating expenses of the Government, under this suggestion the corporation would begin to receive interest payments only after $527,000 had first been utilized by the Liberian Government. Moreover, the corporation had previously agreed to a permanent reduction of the rate of interest from 7 per cent to 5 per cent.
- [Winship]
- Gilbert
- See League of Nations document C.421.M.214.1933.VII (1933.VII.5).↩