Evening star., 1932-01-17
Everybody's
Business
Financial Prestige of League
of Nations Irvo1ved IN
Bu1garas $ Fiscal Crisis.
BY DIR. MAX WINKLER.

Special Dispatch to The Star.
NEW YORK, January 16 (NAN.A)
What Versailles proved to Germany
ST. Germain to Austria, Sevres to Tur-
key Trianon to Hungary, Neuilly has
proved to Bulgaria. There is only one
thing left to the conquered-to expect
no salvation.
Bulgarians, "the Yankees of the
Balkans" were sufficiently short-sightec
to choose the wrong allies during the
Great War. Bulgaria's SIDE lost. An
indemnity was imposed upon the coun-
Try amounting to S434 $50, ,000 equiva-
lent to about $50 for each man, woman
and child living in this tiny and great
ly impoverished Balkan kingdom.
Expressed in terms of the country's
own currency, the per capita burden OF
reparations is equivalent to 1886 leva
A United States Senator suggested that
the Germans reduce their daily con-
sumption of beer by one glass and
presto, she will be able to pay repara-
tions. What would he suggest to the
Bulgarians? Perhaps one smell less
of altar of roses, which is one of the
country's principal products.
Met 1925 Agreement.
Despite continuous warfare with her
neighbors and resultant economic and
fiscal difficulties, Bulgaria has met her
obligations promptly and faithfully. 1t
was not until the outbreak of the
World War that she found it necessary
to suspend payments.
In 1920 negotiations were entered
into with representatives of her for
eign creditors with a view to settling
this question and removing from the
nation the stigma of default. An agree
ment was finally reached in 1925 pro-
viding for the payment of interest on
the various loans held abroad, in the
most appreciated currency specified in
the bonds, at rates varying from 80 to
- per cent of the coupon, with provi-
sions for an increase In these percent
ages until the original rate is restored
in full.
The nation has carried out the terms
of this arrangement most metlculously.
The only appreciation shown by foreign
creditors has been the persistent selling
of Bulgarian issues down to levels which
to a very considerable extent are in
dicative of impending default.
The worldwide economic depression
has not spared Bulgaria. Despite rigid
economies, she has been finding it diff
cult to make ends meet. She has ap-
pealed to the League of Nations for
financial assistance. She may get it.
If she fails, she will be obliged to an
nounce that her present financial situ-
alton does not permit of the payment
of interest and sinking fund on all her
foreign obligations.
Must Follow Hungary.
a method to which her northern neigh
Dor and former ally, Hungary, took re-
course a short while ago-that is, she
will have to deposit Bulgarian money
in the national bank, to be transferred
and made available for her foreign
creditors, as and when conditions allow
Bulgaria has outstanding in the
American market two issues aggregat-
ing about $17,500,000. Her entry into
the American market for financial ac-
commodations took place in 1927, when
7 per cent loan of $4,500,000 was
underWritten by an American banking
syndicate for the purpose of providing,
among others, funds for the settlement
of about 10000 Bulgarian refugees
from other countries. Proceeds were to
be expended under the direct control of
a commissioner appointed by and re-
SpOllSlDle u lile League VI NdIloilo'
In the following year, Bulgaria OBJ
tanned in the American market a 7l2
per cent loan of $13,000,000, proceeds
from the sale of which were allocated
for various governmental purposes, in
cluding liquidating budgetry deficits.
There is no doubt that the successful
marketing of the above loans was due
to confidence which the investors placed
in the ability of the League OF Nations
to look after their interests. The
League would thus appear to have a
certain moral obligation toward those