832.51/2199
The Ambassador in Brazil (Caffery) to the Secretary of State
[Received October 1.]
Sir: Referring to my despatch No. 12810 of September 22, 1943,23 I have the honor to enclose revised schedules of suggested bases for discussion, together with copies of minutes and memoranda, in regard to the proposed settlement of Brazil’s external debt.24
The representatives of the Foreign Bondholders Protective Council, Messrs. Robert E. McCormick and Lee Orton, are working very closely with the Embassy in this matter. I am pleased to report that their practical approach towards and comprehensive grasp of the complex debt problem have served to avoid the creation of frictions with the Brazilian representatives. Furthermore, their technical knowledge has been of much value to the Embassy and the Brazilian Government in the preliminary exploration of this problem.
[Page 774]The Embassy has made office space and stenographic assistance available to the Council’s representatives and I have assigned one foreign service officer and one auxiliary officer to work with them. My Economic Counselor is in daily touch with the Finance Minister and Mr. Bouças25 in regard to various phases of this matter and I am closely watching developments.
While the preliminary discussions have taken place in a friendly atmosphere, it should be pointed out that the attainment of the Council’s objectives is conditioned by the fact that the Finance Minister is the only high official in Brazil who has a real interest in reaching a debt settlement. Others appear apathetic towards the question, while a few have indicated outright opposition to any program which would substantially increase payments beyond the point of the 1940 arrangement.
Respectfully yours,
First Secretary of Embassy