§ 9. Sir ALAN McLEANasked the Secretary of State for Foreign Affairs whether he is aware that the default plan of the Brazilian Government deprives British investors of £16,000,000 a year due by the terms of the contracts under which the moneys were borrowed; and whether this default plan was accepted on behalf of British nationals by the flotation houses who sold Brazilian obligations to the British public or whether His Majesty's Government acquiesced in this default plan?
§ The SECRETARY of STATE for FOREIGN AFFAIRS (Sir John Simon)The full figure for the Brazilian foreign debt service, including the service not only of bonds issued or held in this country, but also of all loans raised in other countries, is, I understand, in the nature of £24,000,000. The plan embodied in the recent Brazilian decree provides, in the first year of its operation, for a total reduction in the foreign debt service of approximately the sum mentioned by my hon. and gallant Friend, a reduction which is borne, however, by all holders of Brazilian bonds and not by British investors alone. Further, the sum of approximately £8,000,000, which is to be provided during the first year, will be increased in each successive year of the four-year period covered by the plan. As regards the second part of this question, I understand that the responsibility for the plan rests solely with the Brazilian Government. No question arose as to the acquiescence of His Majesty's Government.