852.5151/283: Telegram
The Secretary of State to the Counselor of Embassy in Spain (Thurston)
392. Your telegram No. 776 of September 17, 10 a.m.4 American press has recently carried reports that negotiations were being initiated between this Government and the Spanish Government for the payment of some 30 million dollars of private American blocked credits in Spain. The facts are as follows: On September 15, Miles M. Sherover called by previous appointment upon the Secretary and handed to him the original of a letter he had received from Negrín dated August 2, 1937. In this letter Negrín stated that with respect to damage suffered [Page 550] by foreign property or interests through illegitimate actions due to the war the Spanish Government proposed to form a commission to assemble and deal with claims arising therefrom. With respect to commercial credits pending payment he stated that the Spanish Government “regards as just the petition of American creditors and, although this is a problem which it has inherited, it is disposed to reach an agreement with these creditors concerning the manner of paying such debts. The agreement may consist, in general terms, in the payment of a part of the recognized debts in cash and the balance in installments over a period of years, with normal interest until they are entirely paid.” The letter concludes by authorizing Sherover to initiate the necessary preliminary conversations with the interested parties. Mr. Sherover then stated that he believed that a settlement of private American claims against Spain would have a most helpful effect upon trade relations between the United States and Spain. He discussed this point at considerable length and then asked whether the Secretary would be willing to give him a letter stating that in his opinion a beneficial effect on Spanish-American trade would follow such a settlement.
The Secretary told Mr. Sherover that we recognize that Spain has for some time been having financial difficulties particularly with respect to foreign exchange, and that we have been hopeful and confident that ultimately Spain would work out her own position and be able to provide the necessary foreign exchange for the payment of these private claims. He added that in connection with other countries he had been asked at various times for letters similar to the one Mr. Sherover desired and that he had not felt that he could acquiesce in such requests. The Secretary pointed out that these debts are private debts in which the American Government naturally has a sympathetic interest but that they are, of course, a matter for discussion with the creditors themselves.
The Spanish Ambassador at Washington and the National Foreign Trade Council have been informed of the gist of the Secretary’s conversation with Mr. Sherover.
- Not printed.↩