834.51/7–1345

The Ambassador in Paraguay ( Beaulac ) to the Secretary of State

No. 934

Sir: Supplementing my despatch No. 755 [775] of May 11, 1945 (subject: “Allocation of remaining Export-Import Bank credit to Paraguay”), I have the honor to report that I had another conversation yesterday with the Minister of Finance, Dr. Juan Plate, concerning Paraguay’s failure to date to make up the arrears of interest and amortization payments to the Export-Import Bank. I told him that I regretted very much that the Paraguayan Government was letting this matter slip, and that I would like to be able to inform my Government that the Paraguayan Government intended and had taken the necessary steps to pay up promptly.

Dr. Plate then told me of the demands being made on his Ministry. He said that his recent efforts to balance the budget were being resisted by the military, and other ministries also were making unreasonable demands. He said at first that he could make partial payments and insure that the arrears should not accumulate any further. I expressed no enthusiasm over that offer. He said, finally, that he himself was prepared to do two things: first, to pay up the arrears, and second, to allocate additional government revenues to the service of the debt so that additional arrears would not accumulate in the future. He suggested that I take the matter up once more with the Minister of Foreign Affairs, whose support in the Cabinet would be helpful to Dr. Plate.

I saw the Minister of Foreign Affairs this morning and presented the matter to him. I said I would like to see this indebtedness cleared up before Captain Martino, the Minister of Public Works, reaches Washington, in some three or four weeks. Dr. Chiriani agreed to the desirability of this, and said he would take the matter, up at the next meeting of the Council of Ministers on Monday.

When Captain Martino, the Minister of Public Works, called on me this morning, prior to his departure for the United States, I also discussed the matter with him. He said he was in agreement and would support the idea.

I intend to press this matter until it is satisfactorily taken care of.

Respectfully yours,

Willard L. Beaulac