The sun., 1919-04-07
IL. s. Investments in Country
and More Liberal Credits
Are Needed.
CAPITAL IS BIG FACTOR
Better Banking Facilities for
Export Trade Would Improve
Business With Republic.
by JOHN CLAUsEN,

Bank OF NeD YORK.
specially Written for he South Ameyfcdn
Section Of THE Sun
Latin America offers promising mar
kcts toward opening fresh delds for COM
nercial expansion on account OF its rich
natural resources. Never since our sis
ter republics severed the political ties
that bound them to their netherlands
has there been such an opportunity for
the American people to widen the scope
Of their financial and commercial ties
with that part of the New World.
The present commercial and financial
inactivity brought about by the gradual
retirement OF available capitals so
readily obtained in former years from
Great Britain, Germany and France
has proved a serious matter to the re-
publics of the south, whose ability for
development of natural resources Is so
vital an issue to their national pros
perity. This condition is more especially
felt in the Central American republics,
where the purchasing power IL so largely
dependent upon the extent OF their ex-
ports.
Central America forms separate unit
and comprises the five republics lying
between Mexico and Panama, viz {:
Guatemala, Salvador. Honduras, Mica
ragua and Costa Rica. with combined
area Of 174.o00 square miles and q popu-
lation of about Ave and a half millions
$4,000 Square Miles in Guatemala.
The Republic of Guatemala, situated
east OF Mexico, covers an area OF about
$4,000 square miles, with an estimated
population of over 100000. the largest
of any Central American country, OF
which 1856 live in the capital. Guate-
msia City. The name "Gua temala" Is
probably of Aztec origin and is said TO
yaean Land OF the Eagle
Most of its people are in that half
OF the republic bordering on the Paci-
nc, with few settlements on the north
or on the Atlantic side Its mountain
ranges, with few exceptions, give the
country an elevation OF from 1000 to
1900 feet. The Pacific slope is fertile
and produces large crops of coffee. corn
and sugar. while on the Atlantic side
the agricultural wealth is limited except
from the cultivation OF bananas In the
lowlands and near the coast Coffee,
however. forms the principal money
crop of the country and upon its market
ing therefore depends much OF the
prosperity OF the republic.
Guatemala is one OF the most beau
tiful republics In Central America, with
riches incalculable. Close observers.
travellers and investors have been SO
impressed with its great potential rich
ness as to prompt the unique saying:
'If you tickle the ground with a hoe
II smiles back with a yam"
Cabrera an Active Force.
The guiding force Of Guatemala is
its President, Manuel Estrada Cabrera.
who was born In Quezaltengo. Guate-
mala, November q. 1857. He succeeded
Gen. Reina Barrios during the tragic
events of February. 1898. He was
elected later constitutional Chief Execu-
tive of Guatemala on October 20, 1898,
since which date he has guided the re-
public through peaceful years to the
shores of prosperity, which cannot fail
to have beneficial effects on the future
development of that country.
Guatemala has a good system OF pri-
mary education. supported by the Govern
mont with some zoo public schools and
a university for the study OF liberal
professions. 1t is Of interest here to
make mention that English is compul-
sory and proficiency in that language
is recognized as a prerequisite to the
degree OF bachelor OF arts.
While the external transactions OF
Guatemala are liquidated in gold and the
duties in part imposed on that basis
the actual currency of the country con-
sists of bank notes-theoretically pay
able in silver, but not so redeemed
issued by the following six banks
Banco International de Guatemala
Banco Columbiano. Banco de Guatemala
Banco Agricola Hipotecario. Banco
Americana de Guatemala and Banco de
Occidente.
Sum Needed for Gold Basis.
Authorities affirm that II would take
approximately 10000 900 of United
States gold to place and maintain the
country on metallic ba sic. What
chances there may be for converting the
paper money now in circulation into
specie bills depends wholly upon the
desire of the Government TO effect e
suitable currency reform.
The fiscal requirements and The
economic developments OF the republi,
confirm the belief that il n silver stand
ard be adopted GuatemaIas interest
would be well served. although the rist
and fall in value of the white meta
may create uncertain consequences Fol
one reason or another the necessity O
changing the monetary system has no
heretofore made itself vitality felt will
the Government. lnconvertible papel
money may even enlist energetic sup
porters. especially among coffee grower,
profitable to pay their laborers in pape
money and in turn receive gold for thei
exports.
Paper Currency Has Eject.
In face of these arguments, however
we must not lose sight Of the fact tina
many disadvantages which result from
deprecated paper circulation necessa
rily affect Guatemala in its foreign com
merce as In domestic transactions b.
making dearer all articles OF consump
ton. and in consequence encourages tn
purchases OF poorer grades OF food an
necessities OF life. This likewise apple
20 the Importation OF machinery neces
sary in agricultural and other industrie
and in no small measure TO the in
creased burden devolving upon the Gov
eminent for purchases and services 1
foreign countries which are necessarll
paid for in gold.
cordial feeling has been develope
In Guatemala toward the United State.
and while good portion of its com
merce Is carried on with this country,
nluch larger percentage of bushes
transactions could be promoted as n re
suit of the present favorable opportunI
ties. To make our appeals forcibl,
however, II becomes necessary TO inves
capital in the republic; 20 extend NOR
liberal credits; 10 improve banking ia
cilities for export trade, and to max
more direct and personal efforts in thes
markets IT is essential for the MAR
tenance OF the foreign purchasing powe