422.11G93/1111

The Minister in Ecuador (Hartman) to the Secretary of State

[Extract]
No. 525

Sir:

. . . . . . . . . . . . . .

In my telegram No. 21, of March 30, 5 p.m.,24 I gave full account of an interview with the Minister for Foreign Affairs held on the previous afternoon, and mentioned a memorandum which I had presented as the basis of the interview. I enclose herewith a copy of that memorandum (Enclosure 1). In the same telegram I reported at considerable length the substance of the interview, but I am enclosing herewith a copy of a memorandum of the interview which I prepared upon my return to the Legation, which gives the interview more in detail (Enclosure 2.)

In my telegram No. 22, of March 30, 6 p.m.,24 I sent a copy of a telegram from Consul General dated March 29, 4 p.m., giving information as to Government methods of deposits, the substance of which telegram follows:

The Collector receives all money, and at four o’clock each afternoon delivers it to the Provincial Treasurer. The latter makes deposits in bank before 5 o’clock, after dividing the money in accordance with the decree. A remittance on bonds will probably be forwarded to London each month.

In my telegram No. 24, of April 1, 12 noon,24 I informed the Department that the Consul General reports total daily deposits, including March 31st, to be 42,856.52 sucres.

Eliminating Sundays there were 22 days upon which deposits were made. This makes an average of 1948 sucres deposited daily. But Sundays should not be eliminated. Paragraph 11 of Article 1 of modifications to said contract by Congress reads as follows: “In the same Article XVII, insert, ‘there shall be deposited daily one three hundred and sixty fifth part, including holidays.’”

It is clearly contemplated by the contract of September 30, 1918 [1908], that the deposits should be made every day, and as amended by Congress it states, “In the event of there being no [Page 199] deposit of the customs receipts on any day, owing to the said bank or banks being closed, or should the amount deposited on any day be insufficient to cover the said one three hundred and sixty-fifth part of the annual service, the deficiency shall at once be made good from the receipts of the day or days following.”

In my telegram No. 25, of April 1, 2 p.m.,25 I reported that the Under Secretary for Foreign Affairs had informed me that orders had been issued by the Minister of Hacienda to the officials and banks in Guayaquil instructing them to furnish all information desired regarding daily deposits to the Consul General or myself, and that I had notified the Consul General immediately and had received his report as to amounts deposited, which I had telegraphed to Department immediately in my No. 24, of April 1, 12 noon.25

I will keep the Department fully informed of any further developments.

I have [etc.]

Chas. S. Hartman
[Enclosure 1]

The American Minister (Hartman) to the Ecuadoran Minister for Foreign Affairs (Aguirre Aparicio)

The American Minister respectfully salutes His Excellency the Minister for Foreign Affairs, and has the honor to present, for the consideration of His Excellency, the following:

This Legation is in receipt of a cable from the Department of State at Washington stating that it has been advised by the American Consul General at Guayaquil that officials of the Government of Ecuador in Guayaquil refuse to furnish him information regarding the daily deposits being made for the service of the bonds of the Guayaquil and Quito Railway. The Department has instructed the Legation to request of Your Excellency an explanation of such refusal.

While the Legation has not received any official information as to the amounts already deposited, it has received unofficial figures, which, if correct, show clearly that the daily deposits, unless very materially increased, will not nearly equal the sum necessary to pay the interest on said bonds as provided for in the agreement of 1908. My Government, therefore, instructs me to inquire of Your Excellency the reason why these deposits are not being made in sufficient amounts to pay said interest.

The Department of State has directed me to visit Guayaquil and ascertain what the Government methods of making deposits are, and what amounts are being deposited daily, but, in view of the [Page 200] refusal of the officials in Guayaquil to furnish this information to the American Consul General, I have felt that my visit might be without results, unless instructions were given by Your Excellency’s Government to the Government officials and the banks in Guayaquil to furnish me with said information. I therefore respectfully ask Your Excellency to cause to be issued the necessary and proper orders to said officials and banks in Guayaquil to furnish me such information as may be requested regarding the methods of making daily deposits and the amounts of such deposits.

I would appreciate an early compliance with this request, as the Department of State desires to receive this information as soon as possible, and also to be advised of the reasons for the failure of the officials in Guayaquil to furnish said information to the Consul General, and the reasons for the daily deposits being inadequate to pay the interest on said bonds.

The American Minister respectfully tenders to His Excellency the Minister for Foreign Affairs the renewed assurances of his highest consideration.

[Enclosure 2]

Memorandum by the American Minister (Hartman) of an Interview with the Ecuadoran Minister for Foreign Affairs (Aguirre Aparicio) at the Foreign Office, March 29, 1920

I opened the conversation by saying that I had received cable-graphic instructions from the Department of State directing me to make certain requests of the Minister, and that in the interest of accuracy, I had reduced the matter to writing in the form of a memorandum, which Mr. Valencia26 would translate and read in Spanish. This was done. The Minister listened attentively, and, when the reading was completed, he immediately made the remark that the requests were very depressing.

He stated that the refusal of the officials at Guayaquil to furnish the Consul General with the information was doubtless due to the fact that they had not been authorized to furnish it by their superior officers, and that if they had done so they would have violated their duty. I then asked him whether he would be willing to have the necessary orders issued so that the information would be furnished. He hesitated for a time, and said that the customary way to obtain such data was through the Foreign Office, but that he would speak to the Minister for Hacienda and see what he would do. I then called his attention to the paragraph in the memorandum regarding my contemplated trip to Guayaquil to obtain the desired information, [Page 201] and said that in view of the refusal of the officials at Guayaquil to give the data to the Consul General, I feared that my visit would be without results, unless the necessary orders were given to those officials to furnish me the information desired, and I then asked him again whether he would be willing to arrange to have the necessary orders issued to enable me or the Consul General to obtain the data.

He again answered that he would speak to the Minister of Hacienda, and added that the Minister of Hacienda would certainly consult with the President before deciding. He also said the information could be obtained in Quito as well as in Guayaquil.

He then brought up the subject of our interview on last Friday, wherein I had requested the same information orally, and said that he had spoken to the Minister of Hacienda, and that he had said he would have full returns from all the provinces at the end of this month, and would then furnish the information regarding the amount of daily deposits.

Regarding the request for the reason why the deposits are not being made in sufficient amounts to pay said interest, he said that it is because the imports into Ecuador are far below what they were before the war, and far below the estimate of Congress in the preparation of the budget.

He then stated that the Minister of Hacienda was of the opinion that the estimates in the budget would not be realized, and that the present plan of daily deposits would not produce enough revenues to meet the interest, and that he had told the Congress that there would be a deficit of probably 3,000,000 sucres.

He also said that a plan was to be presented to the next Congress, designed to increase the revenues to an amount sufficient to meet the foreign debt and necessities of government.

He also said that, in view of the insistence of the Government of the United States for the resumption of deposits, Ecuador had acceded thereto and adopted the present plan of daily deposits, and abandoned their former policy of making remittances whenever able, and that he believed the former policy, if it had been continued, would have resulted in larger amounts being remitted than the present practice of daily deposits will make possible.

I then suggested that I would greatly appreciate an answer tomorrow (Tuesday), in writing to my memorandum of requests, but he replied that because of the proposed trip of the President and party, including himself, to the Colombian border on Wednesday, March 31, he would not be able to answer then, as his time would be fully occupied in other official work which must be done before his departure, but that the Minister of Hacienda would furnish the information at the end of this month.

  1. Not printed.
  2. Not printed.
  3. Not printed.
  4. Not printed.
  5. Not printed.
  6. Isidora Valencia, an employee of the Legation.