823.51/1544
The Ambassador in Peru (White) to the Secretary of State
[Received May 1.]
Sir: I have the honor to refer to the Embassy’s despatch No. 87 of April 17, 194440 regarding the visit of Mr. James G. Rogers, representing the Foreign Bondholders Protective Council, and to submit the following brief comments, together with enclosures40 pertaining to the first two conferences on Peru’s dollar debt to the United States, in order that the Department be in possession of complete information on this important matter.
Finance Minister East’s statements in the first two meetings contain no indication that the debt problem is much if any nearer solution now than it has been in recent years. The Embassy’s telegram No. 524 of April 20, 6 p.m.,40 for the Bondholders Council from Rogers, summarizes the discussion during the second meeting (Enclosure No. 2) and contains Mr. Rogers’ comment, in which the Embassy concurs, that the Minister conveyed the impression Peru feels no obligation or necessity for much effort and that he appears to be preparing the ground for a very limited proposal, if any.
In fact, Mr. East’s third point at the bottom of page 3 of Enclosure No. 2 would seem to prove that it is even more distant, since the Minister asserted that repayment to the United States for Lend-Lease material must take precedence over the debt settlement.
His first and second points on the same page alone would probably defer any satisfactory settlement of the debt to some future period—available foreign exchange will be applied first to paying for the needed importations of foreign goods and secondly to the replacement of capital goods worn or made useless during the present war. In the most favorable circumstances no settlement can be achieved for several [Page 1574] months, according to Mr. East’s statements that a special commission and then Congress (which does not assemble until the end of July) must give their approval. Arrangements have been made for Mr. Rogers to meet with the members of the Senate and House post-war planning commissions on April 27.
. . . . . . . . . . . . . .
On April 23 Mr. Moreyra42 remarked that Peru’s failure to attend to the postal debt had bothered him to the extent that he discussed it with the President on the 22nd and had been told the President had decided to settle it. No date was specified.
Further details will be submitted as the conversations proceed in order that the Department may be aware of current developments.
Respectfully yours,