El Paso herald. (El Paso, Tex.) 1901-1931, 1912-05-20

q AN JOSE DE COSTA RIGA, May 20.
No other country in Latin Amer
lea is so thoroughly controlled by
foreign interests as Costa Rica. 1t is
often said that the country is a sa-
tTapy of the United Fruit company,
and in some respects this is not so very
FAR from the truth That great cor
pOratiOn has developed the banana
trade Of the country until Costa Rica
is as much dependent on the banana
market for its prosperity as Porto
Rlca IS dependent on the sugar mar
ket. When it is recalled that the an
nual production OF bananas amounts to
nearly 10000. 600 punches; that il is an
! industry which has been developed en-
tirely by the United Fruit company
and that the industry is maintained al
most entirely by it, there seems to be
just ground for the designation
But the domination of the United
Fruit company does not stop there 1t,
with its allied interests, practically
built the railroads of the republic, and
practically controls them today Fur
thermOre, Minor c. Keith, president Of
the United Fruit company and head OF
the interests which have built the
railroads, is practically the treasurer
! Of the republic. Costa Rica for years
has carried a heavy foreign debt. Time
after time IL defaulted in its interest
and was put on the blacklist by the
British corporation of foreign bond
holders. There were not funds enough
less to keep up a reasonable sinking
fund.
Finally it was agreed by the foreign
bOndhOlders that if the government Of
Costa Rica would permit Minor c.
Keith to act as banker for the loan.
which amounts to approXima tely So
coo. 600. money would be furnished to
satisfy the old bonds. new bonds be-
Ing issued therefor. the new bonds 10
bear four percent interest for 10 years
from January J. 1911, and five percent
interest from January J. 1921 until re-
deemed Money was advanced in addi-
ton 10 the amount necessary 10 take
up the old bonds and all accumulated
interest so as 10 bring the new loan
UP TO a total OF approximately 10000
600. the additional funds being prOvId-
ed for meeting the interest payments
OF the immediate future and for GER
tain internal imprOvem euts.
BOrrOws Money in France
In addition Costa Rica negotiated
another loan with Frence bankers In
order to secure funds TO pay off in
ternaI obligations. The internal reve-
nues were pledged to secure the
French loan. But the Keith loan is the
paramount one, and at least so long as
this debt remains unpaid. Keith is
power to be reckOned with But his
connections in Costa Rica are such
that he is perhaps more interested in
Its prosperity than any other man. and
this makes il certain that he viii do
nothing to place the republic on the
back track
The Costa Ricans like foreigners /
They regard their stable government as
being the product OF the foreign COM
mercial invasion. The foreigner with
capital is heartily welcome. because,
they say, that with com bination OF for
eign capital, foreign brains and native
natural wealth. there is no way to pre-
vent prosperity and growth
No Anti-FOreign Sentiment.
In this attitude the Costa Rican
seems TO be wiser than his cOmpeers OF
the other countries Of Central America
He admits that the foreigner is getting
rich in Costa Rica. But what If he
is asks the Costa Rican- Isn't he
likewise making money for us2 Is he
not lettering the condition Of our Ia
Dor as well as four treasury"
When one goes out on, the banana
plantations and sees labOrers getting
81 day In good American gold for
their work. where once they got %
cents. he feels that the Costa Ricaus
conclusion has some degree Of reason Z
back of it, The stimulation that the
banana industry has given the cOun-
try is in evidence on every hand, and !
though the big fruit cOmpany's sins |
may be scarlet and in some ways they
must be if the half OF what one hears |
Is even approximately true, il must be I
credited with a measure of the peace !
and prosperity that obtains through /
out the country
Not always Substantial
The government Of Costa Rica has |
not always enjoyed healthy financial /
conditions. if indeed its finances are !
sound today In the early 10's the gov /
eminent was the victim of that same I
merciless foreign exploitation that !
characterized nearly all the Central /
American republics al that period In !
1871 ii borrowed nearly $4,000, 600, at 1
least 1t gave its bonds for that amount, I
and got about 100000 therefor The I
full assets of the nation, even the ma /
tiOnal domain. were pledged as security /
aHraHHae al
was seven percent on the face value D
OF the loan.
The next year a loan of nearly S12.-
100000 additional was negotiated, the /
republic getting 50 cents for each
dollar borrowed. and Obhgatiug itself /
to pay seven percent interest on the
face value. The liquor tax, the coffee 4
tax and the net earnings Of the railway
were pledged TO secure this loan The
government defauIted on both loans .
in 1874 and ii was not until 1885 that /
things were adjusted again And then I
ii was Minor c.. Keith who put the deal I
through He persuaded the bOndhOld-
ers to accept new bonds in lieu of the /
old ones at the rate of so cents on the [
dollar the interest on the new bonds /
10 he five and four percent instead OF .
seven percent as on the old ones
In spite OF this concession. Costa /
Rica defaulted again In 1898. and 4
again the interest was cut nearly in I
half Again i'm 1901 il defaulJed and {
continued 10 default until 1911. when q Z
new foreiCn loan was negotiated, and Z
10 dav the interest charges, with Keith I
as the banker of the pledged funds,