Evening star., 1941-02-16
BY LLOYD LEHRBAS,
Associated Press Stan Writer

BY LLOYD LEHRBAS,
| Associated Press Stan Writer.
After many years of family squab-
bling, the United States and Mexico
are on the verge Of signing a good
neighbor' pact which, comprising
series of interlocking agreements
settling "all major questions" pre-
sages a new era in friendly rela-
tions between the sister republics.
The hands across the Rio
Grande" pact-now under negotia-
ton between Undersecretary of State
Sumner Welles- and DR.. Francisco
Castillo Najera, the Mexican Ambas-
sador-is frankly designed to wipe
out all past disputes and open the
way for far-reaching economic and
defense collaboration of vital i'm
portance to the future prosperity
and welfare of the Western Hemi-
sphere.
Good d-neighborly collaboration is
of greatly increased Importance now
with war and inf1amed passions
sweeping Europe and Asia and
threatening to spread to American
waters, and Strangling trade across
the Atlantic and Pacific.
Trade Steadily Increasing.
Trade between Mexico and the
United States has been steadily in
creasing in recent years until now
approximately IA per cent of Mex
ico'S total exports are sold to the
United States, and Mexico purchases
roughly "a per cent of its total i'm
ports from this country.
Increase in that trade through a
more friendly and cooperative un-
derstanding would be mutually
beneficial (but especially to Mex
ico), particularly now that most
European markets are blockaded. A
decrease in trade resulting from un-
favorable economic conditions or
strained relations similarly would be
detrimental.
Over the years many contentious
questions have arisen, to create
friction between the neighboring
republics. Some have developed
into serious disputes resulting in
name calling and fist shaking,
threatening the profitable expan-
sion of trade and the security of
investments
Troublesome Questions.
Among the major and most
troublesome questions are:
l. The Mexican government ex-
preparation of foreign-owned oil
companies in March. 1888, involv-
ing investments estimated by the
companies at between s400 900 900
and S440 0000. 900, but valued by the
Mexican courts at only $35 400 900.
The American companies involved
Standard Oil of New Jersey, Stand
ard Oil of New York and Consoli-
dated OIL Sinclair holding
valued their properties at $780,
100000. The Sinclair interests, with
holdings valued at s16000,000, made
a separate settlement for SO 500 900.
The Mexican government refused a
recommendation by Secretary Hull
that the question be arbitrated,
creating a Stalemate.
2. A large number of American
citizens have sizable claims for
land alleged to have been seized by
various Mexican regimes, some dat
ing back 10 years (classed as gen
eral claims0, and for property ex-
propriated by the Mexican govern
ment under its agrarian reform
program (classed as "agrarian
claims'D. Mexico has made pay
ments Of some claims approved by
ice Il
each case.
3. Unpaid interest of Mexican
foreign debts and railroads.
4. Claims by Americans over land
whose ownership has been placed
in dispute by the changing course
of the Rio Grande River, which
forms long stretch of the bound
ary between the two countries.
Claims Against U. S.
Mexico, in turn. has claims against
the United States-resulting from
the Rio Grande's meandering, dis
tr1bution of irrigation water from
the Colorado River, and isolated
cases of alleged damage-and also
desires the United States to make
loans to stimulate its economic de-
velopment, grant favorable trade
treatment, increase purchases of
Mexican silver and other metals,
and otherwise assist in improving
it's economic position.
The United States, in recent ne
gotiationS, has told the Mexican
government in effect that it would
be willing to grant Mexico extern
sive financial and economic assist
ance, contingent on Mexicos settle
ment of those long pending and
trouble fomenting claims
Innumerable diplomatic efforts to
settle the many individual questions
arising from the claims and counter
claims made snail-like progress un-
til Undersecretary Welles and AM
bassador Najera worked out a for
mula which now promises success.
That formula calls for compro-
mise agreements on each of the
separate questions with all fitting
into a general, all-inclusive pact
providing for:
l. Final settlement of all Amer
iCdH CldliIlS against Me8lCO, 1lCluU-
ing compensation to the oil COM
panies for their properties.
2. Agreement by the United States
to grant loans and other economic
assistance to Mexico in a. series
of proposed projects designed to
strengthen Mexico's financial and
economic position.
Defense Not Involved.
Proposed mutual defense measures
are not involved in the proposed
pact, it was learned authoritatively,
but will be discussed after the
claims-loans- economic pact has be-
come an accomplished fact.
The precise projects for which
the United States would grant loans
and economic concessions have not
been officially disclosed, but in
formed sources here envisage sew
eral possibilities, including a loan
to bolster Mexican currency, di-
rectly or through some economic
channel; and action to enable Mex
leo to sell oil produced from the