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File No. 763.72112Am1/75
WASHINGTON, April 29, 1918, 6 p. m. In view of statement in despatch No. 589, January 28, that the Government of Honduras intended to operate lighters as common carriers only until such time as Pacific Mail agency was adequately equipped to carry on this business itself, you may inform the Government of Honduras that as these conditions appear now to be fulfilled it would seem that the 30th of April were an appropriate date to discontinue its conduct of a lighterage business. Report by cable results of interview.
For your confidential information. Your despatches No. 624, March 9,* and No. 646, March 31,2 show that Honduran Government must return seized lighters to the Germans at end of war.
The operation by the Honduran Government of the German lighters entailing their return after the war can not be regarded under the Trading with the Enemy Act as an elimination of German interest.
For this reason, on and after the 1st of May the National Agency will be placed upon the enemy trading list if considered necessary. Cable fully your views.
File No. 763.72112Am1/80
The Chargé in Honduras (Curtis) to the Secretary of State
[Received May 2, 6.35 a. m.] Your April 29, 6 p. m., was received at 4 p. m., and at 6 I saw the President, who refused to see any reason to discontinue operating the seized lighters notwithstanding the assurances reported in the Legation's January 18, 12 p. m., and January 27, 6  p. m., he maintaining that the necessities of Honduranean commerce still required their operation in order to avoid a monopoly on the part of the Pacific Mail agency. I did not feel at liberty to disclose to him any part of the confidential portion of your cable, but in reply to his inquiry as to what objection the United States could have to those continuously operating I suggested that the lighters would have to be returned to the Germans after the war and that the business would go with them. He replied that the Government intended to prevent this by buying the lighters or others at that time and
to continue in the business, so I suggested that it could probably buy those of the Pacific Mail now; he said that for various reasons the Government could not do this now, but that he would try to persuade some of the merchants to do so; however, he would like to know what he was to do with the seized lighters, and when I said to lay them up, he declared that the Germans would immediately complain, and that he had already received a telegram from the Spanish Minister in Guatemala transmitting a message from the German Government to the effect that Honduras would be held strictly accountable for its acts regarding the lighters, to which he had replied by a mere acknowledgment.
The President has shown considerable interest recently in the success of the National Agency and I feel sure that our placing it on the enemy trading list will result in his forbidding the operation of any but its lighters and the consequent total closure of the port of Amapala. If these results can be avoided at all it seems to me that an attempt should be made to arrange for the purchase by the Honduranean Government of the lighters of the Pacific Mail agency; however, the owners may not be willing to sell and the Government has no money except what it has borrowed, which it does not wish to touch.
File No. 763.72112Am1/81
The Chargé in Honduras (Curtis) to the Secretary of State
[Received May 3, 5.45 a. m.] Supplementing my April 30, 12 p. m. I find that owing to the delays and mismanagement of the National Agency the Pacific Mail agent is constantly obtaining more and more of the business which was not given him at first; that the National Agency is allowing its lighters to fall into bad condition so that in a few months it will probably have to retire from business; and that it is losing money rapidly owing to internal confusion and failure to send out bills. Under these circumstances, I wish to withdraw my recommendation in favor of the Government buying the Pacific Mail lighters.
If the Government discontinue [does continue] there is always danger that it will so hinder the operations of its competitors that it will secure much, if not all, the business.
Anything in the nature of an ultimatum, such as blacklisting the National Agency, should be avoided if another solution can be
I shall await your answer to this cable before acting on any further instructions regarding this matter.
File No. 763.72112/9398
[Received July 12, 7.26 a. m.] Your July 1, 3 p. m. The President informs me that he has sent positive instructions to the National Agency to abstain from all business with parties on the enemy trading list. He also promises the appointment immediately of a new manager and complete separation from the customary course 1 sic] and absolute equality of treatment for the De Hart agency. He further repeats his assurances that the Government has sequestrated the lighters without paying for them or making any agreement of any kind to pay and that they will have to be returned after the war; and he expressed the opinion that it was not fitting that the Government be engaged in such business under ordinary circumstances. He asked my consent to telegraph to the Minister at Washington to correct his understanding and I made no objection. Regardless of any instructions he may give I feel sure that some favoritism will be shown, but I recommend that the Trading with the Enemy Act be not enforced.
The enforcement of that act would remove a source of pressure which can be used at any time but its enforcement would cause great ill-feeling, and I consider that it is much more important to secure what you recommend in telegram of July 5, 6 p. m.
I have already protested against the freedom of movement allowed to the Germans, whose leaders held a well-attended meeting at Sabanagrande on the 5th instant, and the President appears to be disposed to issue orders requiring them to obtain permission each time that they desire to move from one place to another. I shall endeavor to secure the issuance of such orders.
File No. 763.72113/684
[Received September 17, 6.45 p. m.] Department's instruction No. 252, July 31. The President at noon said that the Honduranean Government was studying what steps could be taken against the Germans without violating the provisions of the Constitution, but that no one of the measures discussed had been considered to such an extent that it could be spoken of as contemplated. He said that the Government would be most pleased to have an expert of the War Trade Board and Alien Property Custodian come here 2 so that Honduras might copy such parts of the laws of the United States as might be appropriate to the conditions existing in this country. He added that he considered it advisable that this expert come immediately so that laws might be drafted for presentation to the Congress when it reassembles at the beginning of January
It is of the utmost importance to send a man who is familiar with conditions in Latin America, if an expert with such qualifications is obtainable, and he should be instructed to keep in close touch with the Legation. Would moreover refer to my despatch No. 809, August 31, and show it to the person who is appointed.
File No. 763.72112/10103
The Chargé in Panama (Greene) to the Secretary of State No. 2066
PANAMA, August 26, 1918.
[Received September 10.] Sir: With reference to my telegram of May 29, 12 noon, to the Department's telegram of June 3, 4 p. m., and to previous despatches to the Department on the subject of the promulgation of a trading with the enemy decree and of a decree on the subject of espionage by the Government of Panama, I have the honor to transmit herewith enclosed (enclosure No. 13) translation of a note dated August 22, received from the Panaman Secretary for Foreign Affairs, stating that these two measures cannot be promulgated in the form of decrees, but that they will be urged upon the National Assembly at one of its first meetings in September, in order that they can be adopted as the
laws of Panama, as originally drafted by Maj. Ira K. Wells, Judge Advocate General of the Panama Canal Department. These original drafts have already been submitted to the Department in previous correspondence.
The question of persuading the Government of Panama to adopt these laws has been one of constant negotiation between this Legation and the Foreign Office of Panama, since April last. ..
I now no longer have any reason to doubt that early in September these two measures so long urged upon the Government of Panama, will become laws. I have [etc.]
ELBRIDGE GERRY GREENE
File No. 763.72112/10167
The Minister in Panama (Price) to the Secretary of State
PANAMA, September 18, 1918,2 p.m.
[Received 8.30 p. m.] Legislative action on our trading with the enemy proposal, referred to in Legation's despatch No. 2066 of August 29 , has been withheld at our suggestion until we might have the opinion of the Department as to adding to our proposal an article authorizing land holdings of alien enemies in Panama to be sold and title conveyed. Those mainly in mind are the holdings of a German syndicate on Puerto Piñas Bay under management of Augusto Dzuik. now interned. See Legation's despatch No. 1456, July 5, 1917. We would like to get rid of this German ownership if deemed proper by the Department. I presented the matter while in Washington and have the impression that an expression was obtained by the Latin American Division from the Counselor. Information and instructions are respectfully solicited.
File No. 763,72112/10167
The Secretary of State to the Minister in Panama (Price)
WASHINGTON, October 18, 1918, 9 p.m. Your September 18, 2 p. m. It would seem desirable for best interests of Panama that an article authorizing land holdings of alien enemies in Panama to be sold and title conveyed, should be incorpo
* Not printed.