HC Deb 03 March 1930 vol 236 cc26-7
30. Mr. A. M. SAMUEL

asked the Secretary of State for Foreign Affairs if he will now make a brief statement explaining what the Government of Ecuador proposes to do in relation to its obligations to British holders of Guayaquil and Quito Railway bonds?

Mr. A. HENDERSON

In June, 1929, the Ecuadorean Government officially requested His Majesty's Chargé d'Affaires at Quito to ask the Council of Foreign Bondholders whether they would discuss proposals for the settlement of the foreign debt of Ecuador, including the bonds of the Guayaquil and Quito Railway. A preliminary offer made by the Government proved unacceptable to the council. The Government then invited counter-proposals. Negotiations are interrupted at the moment owing to the action of the Government in depositing the funds, which are required for meeting current payments on the foreign debt, with the Central Bank of Ecuador instead of with the paying agents of the bondholders.

Mr. SAMUEL

Cannot the right hon. Gentleman see his way to protest against this default and against the abuse of the confidence of British investors?

Mr. HENDERSON

Those are merely charges, and I must satisfy myself on the matter before I protest.

Mr. SAMUEL

Will the right hon. Gentleman now satisfy himself that this money was lent by British investors on a specific undertaking by the Government of Ecuador and then protest?

Mr. HENDERSON

I will look into the matter.

Mr. MATHERS

Is it not a fact that the bulk of the foreign money invested in these railways is United States money and not English at all?