818.51/6–945: Airgram

The Ambassador in Costa Rica ( Johnson ) to the Secretary of State

[Extract]

A–313. Assuming that Costa Rica may be approaching our government sooner or later for further financial aid in the form of new loans or postponement of old ones, I am summarizing below the nation’s credit position as it appears today:

The Costa Rican public debt stands at colones 231,681,569.13 as of March 31st, including accrued interest. The foreign bonded debt is colones 127,151,930.77 while total foreign debt is colones 147,885,120.57.

The foreign bonded debt is in total default, both as to principal and interest (and in the opinion of some has been written off almost completely in the minds of Costa Ricans).

On the $2 million and $5 million Eximbank credits, Costa Rica has paid the interest so far. But amortization of the $2 million, due to begin in April this year, has been postponed to August and Costa Rica may ask for a further postponement. Amortization on the $5 million Inter-American Highway loans is due to begin in 1946.

The internal debt figure as of March 31st, 1945, is colones 83,796,448.56 of which colones 29,961,062.49 represents the funded portion. [Page 891] Most internal bonds are discounted 30% when sold at the banks or on the street. The floating debt is at least partially in arrears.

Wage and salary payments are from 4 to 8 weeks in arrears in the case of a number of Fomento25 and Public Works laborers and employees.

Government revenues for the fiscal and calendar year 1944 were colones 52.8 million as against colones 67 million of expenditures.

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

Johnson
  1. Secretaría de Fomento, the Ministry concerned with national development.