New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-10-14
INVESTMENTS IN MEXICAN ROADS.


JOHN BIGELoW's MAGAZINE ARTICLE.
WASHINGTON, Oct. 13.-SenOr Romero, Mex
can Minister has prepared reply to an article which
appeared in the October number OF HaTpers Maq0sne,
written by the HonJohu Bicelow of NewYork entited
.The Railway Invasion Of Mexico" senior Romero's reply
is confined to refut ltion or the position assumed
in the article, that the money invested IN rail-
roads in Mexico will not pay reasonable interest and
that therefore it is safe to make such investments
He says il this position is correct other railroads will
be undertaken and even those under construction
may be seriously Affected bat he thinks the question
was fully nyestga gated by the most experienced Amsr-
can racoad before these enterprises were under
taken and that confidence in them as good investment:
cannot easily be shaken Fortunately it is easy to show
that Mr. BigeOws facts and arguments on this point
are erroneous The main reason upon which this gem
tlernan bases his conclusion is the experience Of the
Vera Cruz Railroad He takes It TO- granted that this
road cannot pay than per cent on It's capital and
As he supposes that the best line in that country
he concludes that other roads would earn lcss interest
upon the money invested. But Senior Romero insists
that the history the Vera Cruz Railroad, properly
understood the best possible proof that railroad build
ingis and will be profitable investment in Mexico, and
he supports his declaration with official facts and fig
ures.
The road Is 293 miles long and has cost $l0O00000,
which represents its present capital It cost four times
as much "a it could be built for now for vaou7
First, the money was Obdlaeu ~ BIcdb SdclluCcS
was not furnished when it was wanted. Second, the
building Of the road extended hrrysix years with
many nterm!ssons, and often transferred from one
grantee company to another representing ten grants
or concessions Third, great mistake was made In
beginning its construction at the City Of Mexico, aud
the transportation materials rails locomotives
etc. on carts 200 miles over the mountains was very
extensive Fourth the location OF the road not the
best calculated for profitable enterprise the last
grantee compelled the line TO pass by certain lands
owned by him. which necessitated grade for consd
cradle portion of over 210 feet to the mile and very
extensive construction over broken and mountainous
country Fifth, the grantee paid bonus Of some
millions OF dollars for the concession Notwithstanding
these and many other embarrassing circumstances
showing bad management Mr.. Bigelow comedies that
the road is able to pay per cent upon capital of
$lOOOO.OOO and since his article written another
annual report has appeared showing that for the last
half of 1881 the road paid dividend at the rate OF GIG
per cent per annum Besides it is not entirely correct
that this road only pays this dividend large part OF
the $40 OOO 900 the shape of mortgage bonds draw
ing per interest and on considerable part has
senior Romero contends that the earnings per
qualities OF railroad He complies table
of comparison of The Vera Cruz road with the Union
Pacific and the Central Pacific of the United States,
the two roads Of this country having most nearly tho
same conditions, and shows Tor the year lSsl tne net
Union Pacific S3207 and the Central Pacific, $3,3S3.
The Vera Cruz road Tor the last year made net earn
ing OF per upon capital Of Tl0S,OOU per mile,
about 20 per cent upon obstruction cost OF $4,000
Der mile which ia too liberal estimate Of necessary
cost The latest quotations OF the London stock EX-
change port first mortgage bonds be worth 1856
the second mortgage bonds 13S and the ordinary stock
II3la The foregoing facts aud figures evidently
moi made known Mr. Biyelow his visit to Mexico,
and senior Romero thinks they are not calculated 10 dis
courage American investors i'll Mexican railroads.
lie then proceeds show that Mr. Bgel0w greatly
mlsed as the agricultural capacity and development
of XicO and it's ability from This source 10 support
rnrOais. He cOrrects the errors On this point and
shows that the country possesses very much the same
agricultural conditions California and with the con-
sirneion or railroads Is destined to develop Won
crf cereal production and lOca business for the roads
II claims that Mr. BigelOw Is not sustained by socOl
osts in the assertion mat people ON high attitudes, ike
thoae of Mexico, do observe To be regarded
active force aud that IL has applea-
lion TO the MeXcans than TO tue population OF large
portion OF the United states, III Colorado, Utah.
Nevada, etc, AID besides large part of
Mexico Is and the level.
lie STATS nat the large capital invested by Americans
i'm MeNico cannot seriously detrimental TO the inter
css OF United states, does IL represent much
cash sent ont OF the country. considerable portion
goes the shape of railroad supplies, suoh lOcomo-
tives cars exc. And then, the construction of raj
roads brings the interior OF Mexico into direct and easy
communities On vita this country 10 N destined 10 fur
nsh very large Market for American manufactures
and exchange, all the coffee, sugar and 0tner tropical
products which can be consumed in the United States
For coffee unu.sugur a,ouo this country pays 10
Cuba and Brazil ABOUT 81 100000 almost exclusively
In cash MeNco produce ali Oi those articles needed
here and they viii DO paid for Ia manufactured goSds