New-York tribune., 1903-03-23
AVEBURY'S TESTIMONY
BondhoIders' GrieUances in iSnan;,g
America-American AItruism
London, March ~

mental in effecting settlements Of debts 49,.
| eating $5OOOOOOOOO. He speaks with ~. =
thority of those five billions invested h., F..
Ilshmen and Europeans abroad: and consa,I..s
| Iy his recent address on the subject og So
| and Central American Indebtedness dasarv,.
more careful consideration than Il received =
! meagre press dispatches when II was deIivars5
/ From the full text Of the address, which he ba
sent to me, observe that he strives to rernov.
the current impression that the rate Of fn,sr.s.
| on the external debts of the spanish-An7sr,c..
| republics Is exorbitant. He asserts that ,ba
| bondhoIders are always ready to act reasnnabl,,
| and that they do not demand more than anv
| State can properly afford to pay without retard
| ing its development. He complains. however
! that while the rates Of interest have been ma
| terialIy reduced, it Is notorious that a great
many Of the defaulting countries are In the
! habit OF paying high rates their internal
debts. while they disregard the prior rights q,
external creditors. and treat their Claims with
| cynical Indifference. He considers the refusal
/ of Venezuela and other Spanieh-Amarica7
States to give any adequate guarantee against
/ defaults a most dshonorable course Of conduct
| and recommends the establishment OF interna-
tfonal debt councils similar to those already in
| operation in Egypt. Turkey and Greece
/ Some Of the illustrations cited by Lord Ave-
/ bury are worthy Of consideration. Costa Rica
| scaled
/ 21a and 3 per cent. and Guatemala reduced its
| rate to 4 per cent: and neither IS paying any
thing to it's external creditors at the present mo-
| ment Colombia after suspending payments 70.
| three and a half years. has announced the TO
| sumption OF remittanCes at IL per cent rising
| to a maximum Of , per cent Nioaragu Para
/ quay and Uruguay are honOrably fulfilling thar
| obligations at reduced rate. The rate If in
| terest for Nicaragua is + per cent; that for
Para quay l Z per cent, rising to , per cent;
! that for Uruguay 81 per cent, with per cent for
! a small portion IF the debt The rates for Ven
/ ezuela were 3 per cent the loan ~ 1SNl
/ and ; per cent for the loan Of 1896. tn aver
! age for the external debt being less than T Per
/ cent and payments have been completely
pended although the sum required for interest
| and sinking funds is lftti" over S1"0000.
/ while the revenues in normal times exceed
| S1OGOOOOO. The English loan OF 1881 is
| the hc<ftage Of wars for independence. and
| its payment, according to Lord Avebury,
/ ought to have heen sacred duty The
bonds for the loan of 1896 were chiefly issued -
railway and other companies. for the settlement
of guarantees hopeIessIy i'll arrears and for Sc
curing their redemption in the future and de-
faults in interest occurred in two years. During
the last sixty-nine years Venezuelan hondhOd-
ers have been compelled to accept five successive
settlements and to submit to large sacrifices ot
rightful claims; and the interest has been paid
twenty-nine years and there have been defaults
for the remaining forty years
Lord Avebury cannot perceive either logic or
Justice in the method Of classification adopted
by the British Government in arranging the
claims against Venezuela The seizure OF the
property Of individuals constituted an act OF in
reference for which redress could be demanded
by the British fleet; but there was no repa-ation
IL for ba whose rights
and interests had been arbitrarily taken away.
The claims of industrial companies were placed
in the second class: while the external loan ot
1896 issued principally for the settlement OF
guarantees due to railway companies and IN
dustrfaI enterprises. was relegated TO the third
class. The bondholders were Disseminated
against apparently. because they had accepted
bonds In settlement OF guaranteed claims. and
submitted to considerable losses; and other
claimants representing unguaranteed and unset
tied industrial enterprises were allowed a pref
erence. The British Government. in the tUdg-
rnent Of Lord Avebury, have uniustly put large
number Of foreign creditors in a superior posi-
ton to these hondholders. And the status ~
English investors with valid claims. for which
Venezuela has never disclaimed responsibility,
has been left worse than II was before. II has
drawn an unfair distinction TO the disadvantage
of bondholders who represent legitimate and
Lord Avebury makes IS justified when the
claims Of the British and German governments
are critically examined. One OF the insCrutahle
features OF the Anglo German alliance was the
preference which was established FOR the IN
rerfor claims OF Industrial companies Lord
Lansdowne has been no match for the German
Foreign once IN the manipulation and cIass'1-
cation Of claims against Venezuela
Tord Aveburv's spacfaI remedy for the griav-
ances of British bondhoIders in the venezuelan
affair would have been the reference Of the
entire external debt to the tribunal Of The
Hague for equitable settlement This course, IN
his Judgment would have greatly assisted thou-
sands Of English investors who have been de-
frauded in SpanLsh-AmerICan transactions MS
general remedy 9or the population Of hIano'd1
obligations on the part Of Spanish-Ameriean r.
pubIics is the nostrum proposed ny nearly 80
writer and moralist of the British press
to be hoped also" he remarks, that the Jnl'S'
States Government will recognize that the N""-
roe claim involves a certain responsibility Inc
Central American States cannot expect % u
protected from annexation unless they are ~
pared to fulfil their engagements Ihe Ha--
repudIatIon Of their responsibilities has io"7
been a disgrace to several of the AnleE'yA'.
nubIics: II has seriously interfered with tHe"
own prosperity, and has compromised an" u
cred the credit Of neighborIng countries "nl "
like Brazil and Chilli. have faithfully fu'll-'
their obligations" This is the stock ne'H''
Of dealing with the subject in England ~
IA no objection TO the Monroe Doctrine WIZ
accented on the whole RritlsA l''
since II secures the maintenance ~ 7'8'e
Western Hemisphere; but the moralslS u" -.
declaring that the Americans cannot " -
to enjoy all the privileges Of PoliticaI S"f'' -