821.2612/2–151
Memorandum of Conversation, by Mr. Albert H. Gerberich of the Office of South American Affairs
Subject: Colombian application for International Bank Highway Construction Credit.
| Participants: | Ambassador Eduardo Zuleta Angel |
| Minister-Counselor Diego Suarez1 | |
| Minister of Public Works Jorge Leyva2 | |
| Mr. William MeChesney Martin, Asst. Secy, of Treasury | |
| Mr. John S. DeBeers (Treasury) | |
| Mr. Atwood,3 Mr. Gerberich (OSA) |
The Minister of Public Works said that he wished to outline the difficulty he has been having in presenting an application for a credit to the International Bank to defray dollar expenses in the Colombian highway construction program. He said the condition of the Colombian roads is incredibly bad—so bad, that the average life of a truck on them is not more than 12 to 14 months. The Minister referred to the Currie Report,4 which indicates that improvement of transportation facilities is one of Colombia’s chief needs. He said he had discarded his original highway plan to make it conform to the Currie recommendations, and then discussed it with officials of the International Bank. They have been studying this revised plan for four or five months now, but have not shown any receptiveness to a formal application. Instead they have kept informing him that the project requires more study, and have sent engineers, lawyers, etc., to advise with the Colombians from time to time. The Colombians cannot wait longer, and the Minister hoped Mr. Martin could inquire into the subject and help them if he can.
Mr. Martin said he would be glad to do what he could. He asked how much the total amount would be. The Minister said that the entire project would be 165,000,000 pesos, and dollars would have to be obtained for 30% of this, about $26,000,000 in all. The term of the loan would be four years.
The Minister also brought up the arrangements that had been made with a Belgian firm for a 6–year credit to purchase rolling stock for the National Railways. The International Bank officials had suggested that action on this be deferred until they could study it, and perhaps the credit could be furnished through the Bank. This project is still under study, and the Minister is minded to transfer it to the Export-Import Bank, but didn’t want to make a false step, as he is not aware of the line of demarcation between the jurisdictions of the two Banks.
Mr. Martin said he was not in a position to speak for the Export-Import Bank, but he wanted to explain that originally the plan was to have that Bank in the course of time restrict itself to short-term credits while the International Bank should handle long-term, more [Page 1293] comprehensive development credits.5 He said he would inquire about the railway credit at the same time that he inquires about the highway credit application.6
- Diego Suarez Costa.↩
- Jorge Leyva Urdaneta.↩
- Rollin S. Atwood, Deputy Director, Office of South American Affairs.↩
- A nine-man mission headed by Mr. Lauchlin Currie (popularly known as the Currie Mission) had been sent to Colombia in July 1949, by the International Bank for Reconstruction and Development (IBRD), for the purpose of assessing the country’s economic potentialities and recommending an integrated program for economic development. For the mission’s report, see IBRD, The Basis of a Development Program for Colombia. Report of a Mission headed by Lauchlin Currie and sponsored by the International Bank for Reconstruction and Development in collaboration with the Government of Colombia (Washington, 1950).↩
- For documentation concerning the establishment of the IBRD, see Foreign Relations, 1946, vol. i, pp. 1384 ff; for information on the Export-Import Bank, see United States Senate, Legislative History of the Export-Import Bank of Washington, Senate Document No. 85, 83d Cong., 2d Sess. (Washington, 1954). For documentation relating to the status of the jurisdictional issue between the two banks in 1951, see vol. i, pp. 1573 ff.↩
- On April 10, 1951, the Board of Directors of the IBRD approved a loan of $16,000,000 to the Republic of Colombia to finance the reconstruction of portions: of Colombia’s highway network, and the loan became effective on July 6 (398.14/7–3151). In a letter dated May 5, 1951, to the Secretary of the Treasury, John W. Snyder, commenting on the loan, the President of the IBRD, Eugene R. Black, pointed out that only slightly more than two months had elapsed between Colombia’s request and the conclusion of the loan (Department of State National Advisory Council Documents, Document No. 1150, June 5, 1951, Lot 60 D 137, Box 367).↩