Evening star., 1938-08-28
INVESTORS WATCH
MEXICO DISPUTE
81, 900, 100000 Stake Is
Big Factor in Land
Seizure Row.
BY the Associated Press.

By the Associated Press.
A direct United States stake Of more
than $4,000, 900 900 in Latin America
is one cogent reason the State Depart
ment is proceeding cautiously in its
controversy with Mexico over the
seizure Of American property.
The security Of these investments
Is involved in somewhat the same way
as the fate OF American oil properties
Is tied up with the current diplomatic
exchanges over American farm lanoa
seized in Mexico.
The precedents esta blished in the
dispute with Mexico. In the view OF
officials here, are bound to influence
materially the future status Of United
States capital in the rest Of Latin
America.
THIS is one of q multitude OF fac
tors involved in the controversy
Others which weigh heavily with the
administration include the good
neighbor policy OF sympathetic CO.
operation with the other Fl Ameri-
can republics and the practical con-
sideration that sales OF American
goods TO them have been on the in
crease
Such sales last year totaled 1891,
90l 900.
Nearly Billion Invested.
Most recent Commerce Department
figures list the value OF direct invest
ments of United States citizens in
Latin America at s2.847 900 900. Atop
this is approximately 1927 900 .000
which American investors have loaned
in Central and South America and the
Caribbean.
The biggest individual stake-about
$500, ,254 900 in direct investments-is
In Cuba. Next Is that in Chile, 3483,
10000; and third, the holdings in
Mexico. The pre-expropriation esti-
mate for that country was S479 ,465, 900
In other countries investments were
thus estimated: Argentina, S348, ,260,
900; Brazil, sls4,345 900; Venezuela
sl86, ,266 900; Colombia. sl07 .549. 900.
For Peru the figure was S96 ,052 900
In other countries the amount wal
substantially less
The dispute with Mexico represents
only one instance OF the difficulties
encountered by American capital
abroad since the World War made this
country great credit exporting Ma
ton. In the Soviet Russian Reyolu-
tion. Germsny'S imitation upheaval
and else where billions have been lost
While Mexico has been putting into
effect 4 far-reaching socialization pro.
gram. her neighbors have been i'm
PEELED by the same tendency to ma
tionalization Of industry. The effect
to some degree. has been much the
same on foreign investments.
Development Summarized.
An administration authority close tc
Latin American trends thus summar-
lied developments of recent years,
using restrictions on petroleum as an
example in many instances:
Cuba-Numerous laws tightening
local control Of foreign-owned con-
Germs. heavier taxes, temporary de-
fault on interest Of foreign loans.
Chile-Laws declaring land on
which oil Is found would become gov
ernment property. Government con-
troll OF refineries since 1881. Laws
governing distribution and prices, ap-
proved but not all applied.
Mexico-Expropriat of American
oil properties and farms; indemnifica-
ton still in dispute.
MISUNDERSTANDING its con-
troll Of foreign oil companies since
1885.
BraziEPetroleum control law in
effect since 1881.
Bolivia - Standard Oil holdings
valued at Sl7,000,0OO confiscated two
years ago on grounds of fraud and
failure to develop oil lands. Dispute
now pending in courts.
Ecuador-Close control OF foreign
industries.
Uruguay-Governm control Of
refineries.
Venezuela-Governme wants fur
ther share in foreign profits.
Pace Slowing Up.
Of1setting these developments Is the
observation Of some American officials
that the pace Of naturalization has
been slowing up. Many Latin coun-
tries have decided they still need for
eign financial and technical assist
ance
The United States is the best GUS
toner Of II or Is of these countries
and Is the second best market for
most of the Others
Disdaining Mexico's example, little
Costa Rica. while authorizing expro-
priation Of properties of the Electric
Bond q Share Co., promised compen-
sation in advance, as directed by its
constitution.
Warren Lee Pierson. president OF
the Export Import Bank Of Washing
ton, said on his departure this month
on South American trade tour that
the returns on that agency's Latin
American commitments had been sat
oioSeoy III tH1 IdSt yedl
Excepting the Mexican seizures. which
Secretary Hull termed "conf1scation"
rather than legal appropriation. many
American officials are frankly tolerant
Of the efforts Of various Latin Ameri-
can countries to control their own
economy.
World Wide Phenomenon.
These trends are evidence of the
awakening Of = new national con-
sciousness. Of the coming OF age 20
to speak. of the southern republics. "
George Wythe, chief of the Latin
American Division Of the Commerce
Department, said recently.
Undoubtedly they will continue to
need and desire the collaboration Of
foreign capital and foreign manage
ment and technical aid, but on some-
what different terms than In the past.
In order to keep the proper perspec-
tive, 1t may be appropriate to point
out that the trend toward diffusion
OF manufacturing Is q worldwide phe-
nomenon and that the striking manu-
featuring progress in some of the