Loan of the Military Government to the Commune of Azua of $15,000.00 (quince mil pesos) at a rate of interest of 5%, under date of June 8, 1920. Contract between the Commune of Barahona and the Military Government for a loan of $25,000.00 (veinticinco mil pesos) at a rate of interest of 5%, under date of April 8, 1920. Contract between the Commune of Villa Mella and the Military Government for a loan of $14,650.00 (catorce mil seis cientos cincuenta pesos (at a rate of interest of 5% under date of May 25, 1920. The Dominican Government likewise agrees that those Executive Orders, those resolutions, those administrative regulations, and those contracts shall remain in full force and effect unless and until they are abrogated by those bodies which, in accordance with the Dominican Constitution, can legislate. But, this ratification, in so far as concerns those of the above mentioned Executive Orders, resolutions, administrative regulations, and contracts, which have been modified or abrogated by other Executive Orders, resolutions, or administrative regulations of the Military Government, only refers to the legal effects which they created while they were in force. The Dominican Government further agrees that neither the subsequent abrogation of those Executive Orders, resolutions, administrative regulations, or contracts, or any other law, Executive Order, or other official act of the Dominican Government, shall affect the validity or security of rights acquired in accordance with those orders, those resolutions, those administrative regulations and those contracts of the Military Government; the controversies which may arise related with those rights acquired will be determined solely by the Dominican Courts, subject, however, in accordance with the generally accepted rules and principles of international law, to the right of diplomatic intervention if those Courts should be responsible for cases of notorious injustice or denial of justice. The determination of such cases in which the interests of the United States and the Dominican Republic only are concerned shall, should the two Governments disagree, be by arbitration. In the carrying out of this agreement, in each individual case, the High Contracting Parties, once the necessity of arbitration is determined, shall conclude a special agreement defining clearly the scope of the dispute, the scope of the powers of the arbitrators, and the periods to be fixed for the formation of the arbitral tribunal and the several stages of the procedure. It is understood that on the part of the United States, such special agreements will be made by the President of the United States, by and with the advice and consent of the Senate thereto, and on the part of the Dominican Republic shall be subject to the procedure required by the Constitution and laws thereof. II. The Dominican Government, in accordance with the provisions of Article I, specifically recognizes the bond issue of 1918 and the twenty-year five and one-half percent Customs Administration Sinking Fund Gold Bond Issue authorized in 1922, as legal, binding, and irrevocable obligations of the Republic, and pledges its full faith and credit to the maintenance of the service of those bond issues. With reference to the stipulation contained in Article 10 of the Executive Order No. 735, in accordance with which the loan of five and one-half percent authorized in 1922 was issued, which provides:— "That the present customs tariff will not be changed during the life of this loan without previous agreement between the Dominican Government and the Government of the United States;" the two Governments concerned agree in interpreting this stipulation in the sense that, in accordance with article 3 of the Convention of 1907, a previous agreement between the Dominican Government and the United States shall be necessary to modify the import duties of the Dominican Republic, it being an indispensable condition for the modification of such duties that the Dominican Executive demonstrate and that the President of the United States recognize that, on the basis of exportations and importations to the like amount and the like character during the two years preceding that in which it is desired to make such modification, the total net customs receipts would at such altered rates of duties have been, for each of such two years, in excess of the sum of $2,000,000 United States gold. III. The Dominican Government and the Government of the United States agree that the Convention signed on February 8, 1907, between the United States and the Dominican Republic, shall remain in force so long as any bonds of the issues of 1918 and 1922 shall remain unpaid, and that the duties of the General Receiver of Dominican Customs appointed in accordance with that Convention shall be extended to include the application of the revenues pledged for the service of those bond issues in accordance with the terms of the Executive Orders and of the contracts under which the bonds were issued. IV. This arrangement shall take effect after its approval by the Senate of the United States and the Congress of the Dominican Republic. DONE in four originals, two in the English language, and two in the Spanish, and the representatives of the High Contracting Powers signing them in the City of Santo Domingo, this twelfth day of June, nineteen hundred and twenty-four. 839.00/2844 : Telegram The Minister in the Dominican Republic (Russell) to the Secretary of State SANTO DOMINGO, July 3, 1924-5 p. m. [Received July 4-2:35 p. m.] 30. Electoral College has elected Horatio Vasquez and Doctor Velasquez President and Vice President respectively. Proclamation will be issued July 4th and the inauguration will be set for July 12. RUSSELL 839.00/2861: Telegram The Minister in the Dominican Republic (Russell) to the Secretary of State SANTO DOMINGO, September 18, 1924-5 p. m. [Received September 19-9:30 a. m.] 55. Provisions of the Plan of the Evacuation have been completed and all of the Forces of Occupation have left the country. RUSSELL APPROVAL BY THE UNITED STATES OF THE ISSUE OF $2,500,000 OF TWO-YEAR NOTES BY THE DOMINICAN REPUBLIC 839.51/2386 The Minister in the Dominican Republic (Russell) to the Secretary of State No. 909 SANTO DOMINGO, November 24, 1923. SIR: I have the honor to enclose herewith a translation of a note to me from the Foreign Office 10 requesting the approval of the Government of the United States for the issuance of bonds to the nominal amount of two million dollars of the balance of the total not issued but authorized by Executive Order No. 735 of the Military Government.11 There is also enclosed a statement 10 showing the application of the funds derived from the bond issue of $6,700,000.00 in accordance with the provisions of said Executive Order No. 735. I have [etc.] 10 Not printed. "Foreign Relations, 1922, vol. 11, p. 85. WILLIAM W. RUSSELL 839.51/2388: Telegram The Minister in the Dominican Republic (Russell) to the Secretary of State SANTO DOMINGO, January 7, 1924—noon. [Received January 8-3: 40 p. m.] 1. Provisional Government has prepared decree similar to Executive Order 735 by which [$]6,700,000 bonds were issued out of total authorized issue of [$]10,000,000. New decree contemplates issue of [$]2,000,000 of the remainder in accordance with plan forwarded in my despatch number 909 of November 24. Government requests me to ascertain if the Department agrees to this new issue in order to have everything in readiness to comply with obligations of contract with Santo Domingo Water, Light and Power Company.12 RUSSELL 839.51/2388: Telegram The Secretary of State to the Commissioner in the Dominican Republic (Welles) WASHINGTON, January 12, 1924-6 p. m. 1. With reference to telegram number 1, January 7, noon, from American Minister, Santo Domingo, the Department desires your views regarding the possible effect of bond issue on political situation in view of approaching elections. This of course does not refer to obligations of Power Company contract. Reply by cable. HUGHES 839.51/2389: Telegram The Commissioner in the Dominican Republic (Welles) to the Secretary of State SANTO DOMINGO, January 17, 1924-11 a. m. [Received January 18-1:27 a. m.] 3. Your January 12, 6 p. m. I do not consider that the bond issue for which authorization is requested by the Provisional Government can have any prejudicial effect upon the political situation. The proceeds of the issue, except for the amount required by fulfillment of the Light and Power Company's contract (should that contract be carried out), are destined for the completion of the Government's road construction program, of which the entire Republic is now enthusiastically in favor. Should the bond issue not be authorized, the construction of the projected highways-essential to the 12 See post, pp. 670 ff. development of the country-cannot be continued and a strong reaction in public opinion would undoubtedly result. The Dominican people in general are so heartily in favor of road construction by the Government that the nacionalista elements will not be able to oppose any governmental measure necessary to continue this work. I therefore recommend that the Department's authorization to the bond issue be granted. WELLES 839.51/2400 The Secretary of State to the Commissioner in the Dominican Republic (Welles) 13 No. 550 WASHINGTON, February 27, 1924. SIR: The Department is in receipt of a letter dated February 4, 1924, addressed to the Secretary of State by the Secretary of the Navy, in which Mr. Denby calls Mr. Hughes's attention to the alleged excessive expenditures of the Provisional Government of the Dominican Republic, which have reduced the surplus of $814,934.03 existing on October 1, 1922, to a deficit on September 30, 1923, of $294,943.57. It is also stated that the Military Governor, in his report for the year ending September 30, 1923, estimates that the deficit on December 31, 1923, will be $660,000. The Secretary of the Navy concludes that "with definite signs of an approaching financial crisis in the Dominican Republic it would appear highly desirable to consider and develop some plan to meet the situation". A copy of Mr. Denby's letter is enclosed herewith.14 From information at the disposal of the Department it would appear that the year 1922 began with a deficit of about a million dollars, and that the surplus of $814,934.03 of October 1, 1922, was occasioned by the sale of bonds, amounting in nominal value to $6,700,000, of the 52 per cent loan of 1922. In other words, the surplus of October 1, 1922, was apparently not produced either by a large income from taxation or other sources, or by a policy of economy on the part of the Military Government. The Department understands, furthermore, that a large part of the expense incurred by the Provisional Government is due to extensive road building and the training of the Dominican National Police, both of which measures have been strongly advocated by the military authorities. It is also reported that the sales of government-owned tobacco, to "This instruction was misdirected to the Legation and was numbered accordingly; Mr. Welles did not receive it before his reply to the Department's subsequent instruction, no. 5, March 21, infra. (File no. 839.51/2411.) "Not printed. |