Evening star., 1941-11-20
Mexican-U. 5. Plan
To Settle Common
Problems Hailed
Oil, Silver and Other
Programs Called Help
To Hemisphere Solidarity
~ the Associated Press.

pioSl olll lOI lIlC dlillSdplS
big, long standing problems which
affected harmonious relations be-
tween Ele two countries in the past.
Both Secretary of State Hull and
Francisco Castillo Najera, the Mexi-
can Ambassador hailed the accom-
plishment as an advance of great
Importance in the field of hemi-
kprere solidarity and collaboration.
The program, represented by a
series OF agreements signed late yes
terday, provides for the following:
Settlement of the protracted con-
troversy over Mexicos appropriation
Of American Oil holdings there.
A S40,000000 payment by Mexico
as full settlement of general and
agrarian claims by American citi-
Gems.
Negotiation of reciprocal trade
pact.
American financial assistance in
stablllzlng the Mexican peso.
An agreement for purchase bv the
United States of newly-mined Mexi-
can silver.
A s30.000000 loan by the United
States to assist in the financing of
Mexico's highway construction pro-
gram.
Oil Dispute Most Difficult.
Settling the oil appropriation dis
pute promised to be the most diff
cult task posed by the program Ever
since the oil properties were taken
over by the Mexican government in
March. 1888. there have been nego-
tlations between the Mexican gov
eminent and the oil companies to
arrive at mutually satisfactory
price for the holdings.
State Department officials dis
closed yesterday that the oil COM
panies did not agree to the settle
ment provisions set forth in yester-
days six-point program. They
added, however that the companies
had been kept fully informed during
the period of its preparation.
The Oil agreement provides that
II the American and Mexican ex-
perts fail to agree on the value of
the interests involved. the two gov
ernments shall undertake negotia-
tions. But if no agreement is reached
on the compensation within five
months after the start of the nego-
tiations, the whole oil agreement
shall be void. and Mexico shall get
back 100000 she is to deposit to be
held pending settlement.
There has been a long controversy
over the oil properties which were
taken over by the Mexican govern
ment in March, 1888.
Hull Calls Plan Practical.
In making the announcement in
volvlng oil, Mr.. Hull said that agree
ment deserves special mention"
The petroleum properties" he
said, were appropriated three and
nall years ago. Since that time
negotiations have been repeatedly
undertaken by the Mexican govern
ment and the United States inter-
ests.
Unfortunately, the negotiations
Involving the largest United States
interests were fruitless. Although
this Government was not a direct
participant in these negotiations. it
did what 1t could to facilitate a solu-
ton Of the problem through both
formal and informal representations
70 the Mexican government.
This Government" Mr.. Hull con-
tlnued. believes that the arrange
ment signed today embodies a prac-
tlcal. efficient and equitable proce-
dure Tor promoting solution of this
question. Its central feature is pro-
vision for the determination of the
value of the appropriated properties.
rights and interests. This informa-
ton obviously is essential in con-
nectlon with any settlement. The
American interests involved will re-
tain full liberty of action in deter
mining the course they will pursue
before, during, and after the valua-
ton proceedings"
$S.0O0,00O Agrarian Payment.
Mexico has already made pay
ments of s3,OOO.O0O on agrarian
claims arising between August 80,
1927, and October 7, 1910, and will
make an additional payment of So
0000 upon ratification of the
agreement. The balance of S34 OOO,-
600 will be paid in annual INSTALL
ments of s2,500,0OO.
The monetary agreement provides
Tor the use of maximum of $40
100000 from the So 1000 900 900 United
States stabilizatio fund to stabilize
the exchange value of the United
States dollar and the Mexico peso.
The peso currently is worth about
Il cents and officials estimated that
the stabilizatiOn rate would be about
the same, although the rate was
not disclosed officially. The pact
apparently involves the purchase of
Mexican pesos by the United States
when necessary to prevent fluctua-
tions in the relative values of the
two currencies.
The silver agreement provides that
the United States Treasury will, on
q month-to-month basis, purchase
silver directly from the Mexican
treasury ranging up to 5000 900
ounces per month. The United
States Treasury is to notify the
Mexican treasury each month of
next months quota The price will
be determined daily by the Secre-
tary of the United States Treasury
Fees to Be Saved.
At present, Mexico sells its silver
through the New York Silver Mar
ket, where the United States Treas
ury is the principal buyer. There
fore, the principal change in silver
buying will be to make it simpler
for the Mexicans to sell their silver
and give them some advance assur-
ance that there will be a market
for it.
Mexicans will save small broker
age fees by not having to deal
through the New York market. Cur
rently, the United States Treasury is
paying IS cents an ounce for foreign
silver and has maintained this price
steadily since the middle of 1888.
In past years, it has paid as high as
30 cents. BY congressional enact
r