Horacio Bossi Cáceres, Julio Zamora, and José Corbacho, Pan-American Commerce, 1919

At the Second Pan-American Commercial Conference, held in Washington, D.C. in 1919, representatives from throughout the Americas discussed ways to increase hemispheric trade. The First World War had recently ended, and business leaders and diplomats, such as those included in this selection, tried to figure out what global trade patterns might look like in the 1920s.

Horacio Bossi Cáceres, Argentine Consul General in San Francisco

As a Consular Representative of the Argentine Republic, it gives me great satisfaction to express my opinion and that of my country in regard to those propellant factors which should be put in motion, so that existing commercial intercourse between our respective countries may be consolidated and established upon a solid, permanent basis.

It is now evident that owing to the disastrous war which so ruthlessly scourged old Europe and almost destroyed the industries in those countries, the great Northern Republic had the opportunity of being better acquainted with and therefore more able to estimate her Southern sister Republics, then discovering that there are, within their boundaries, immense and accredited markets which will enable her to rapidly increase her wealth and extension.

Until five years ago your knowledge of the markets beyond the marvelous Panama Canal were extremely insignificant because your endeavors to enlarge them were insignificant, too, this fact being due perhaps to pressure of your protectionist commercial policies, which traditionally have kept your capitalists in the background of the stage of the commercial life on this Continent, when as a matter of fact your wonderful progress and immeasurable wealth are reasons more than sufficient to entitle your nation to go far ahead of all of the European countries, which, however, having been more foresighted and better connoisseurs of the Southern Republics, poured out their money into them and brought the efforts of their workers’ strong arms to make us and to make themselves rich. This remarkable fact has been synthetized by a notable statesman of my country, when he said:

“We owe the wealth and prosperity of the Argentine Republic to the sterling pounds of England and to the strong arm of the Spaniards and Italians.”

Yes; that is true. The solid and unshaking foundation of British preponderance and control of South America lies upon the above mentioned fact. And it certainly will be very difficult not to say impossible, to lessen that preponderance, unless weapons and procedures similar to those England has used, should be used, also.

Time after time it has been openly advised by your most proficient business men to employ several means not only to prevent actual intercourse between the Argentine and the United States from going down, but instead to surpass the high figures already reached which made a record in the history of our commercial life. Yet, only a few amongst them have demonstrated an exact understanding of Argentina’s commercial history and have pointed out the true items and causes which interfered with the growing up of North America’s interests, the figures of which should be remembered now in order to make a comparative study of the situation.

From 1883 till 1913, that is, a period of over 30 years, the bulk of commerce between Argentina and the United States in comparison with the bulk of commerce between Argentina and Germany and England during the same period reached the following figures:

1883. 1913. England $36,652,000 $251,254,000 Germany 11,851,000 129,227,000 United States 8,443,000 84,727,000

Later on these figures changed on account of the European war and at the end of 1917 the United States had risen to the top, according to the following data:

United States $299,854,000 England 243,831,000 Germany 294,000

If we were to study the extraordinary triumph won by your country at this exceptional moment in the world’s commercial life we certainly should find out two most transcendental facts which cannot escape the judgment of a studious and calm observer, to wit: the complete elimination of Germany from the markets of this Continent and the ever growing strength of the commercial links which bind England and the Argentine, allowing the former to retain unshaken the high place in the financial and business world of my country in spite of her enormous losses on the sea and her most critical economical political situation.

Yet, the explanation of the British preponderance in Argentina’s market could be easily found if only bearing in mind that she made such great investments in behalf of the economical and industrial development of Argentina, investments which are represented by the enormous sum of two billions of dollars, with which we have been able to move our locomotives and street cars, feed our ports, exploit our forests, cattle and agriculturing enterprises and inject vigorous life, activity and progress into all our industries, maintaining at the same time the credit of our Public Treasury with the almost whole British subscription of our foreign public debt.

A statement formulated the 31st of December, 1908, shows the British capital in Argentina, as represented by the following figures:

Capital. Interest. Loans, Government, Provincial, Municipal $319,273,215 $15,232,990 Railways 831,803,415 40,247,155 Banks 39,312,000 3,525,480 Agricultural loans and mortgages 34,236,080 1,298,660 Tramways 101,423,525 4,378,115 Electricity 25,762,950 1,438,425 Agriculture 20,094,985 1,241,020 Various 73,648,540 3,929,930 Total $1,445,554,710 $71,291,675

The value of maritime interests represented by quite a large number of ships, as well as the capital invested in other numerous transactions, totals more than $100,000,000, which should be added.

Second to England, France is the nation among the European powers which had faith in the credit and capacity of Argentina and has made investments of nearly $400,000,000, distributed as follows:

States funds $261,661,530 Banks 51,678,400 Transports 64,011,450 Mines 2,744,890 Various 14,900,000 Total $394,966,270

Germany was the third till the beginning of the war, her investments being estimated at nearly $300,000,000, distributed in banks, industrial concerns, electric companies, electric railways, etc. The above figures correspond to the same date, December 31, 1908.

Summarizing, the foreign capital which met a most profitable and safe investment in the Argentine Republic is far above the amount of three billions of dollars, of which two-thirds are owned by England, while such a small percentage corresponds to the United States that it has to be considered under the column of “others.”

Having in view the practical application which characterizes the American spirit in all orders of human activity, and, according to the facts just set forth above, I have no doubt that it should be very easy for you to foresee the measures of a defensive nature that England, France, Italy, etc., shall present in opposition to you in order to keep for their own benefit the position they had reached after long years of fruitful perseverance and uninterrupted accumulation of new and valuable investments and the fruits of their energies.

Nevertheless, that does not mean that your cooperation in the business life of Argentina should have to face obstruction. On the contrary, the forceful exclusion of Germany which necessarily has been disastrous to that country and the weakening of France and Belgium which will bring their sources of production to a very low level for years to come, will leave open and free the door of an immense field for your industries, if you only know how to appreciate the opportunity and meet the demand of Argentina, affording the same kind consideration, credit, loyalty and benevolence that the industrial people of Europe have always granted to her.

So it is my opinion that you should not hesitate in pouring out your capital and labor into the young, flourishing land of Argentina, where institutions, codes and laws are so very similar to yours; try to help her by laboring her soil, cooperating in the development of railroads, the irrigation of lands, the building up of roads, harbors, etc., thereby securing the sale of your merchandise which are to be transported on your new efficient merchant fleet and the return freight to make the traffic profitable.

One of your most conspicuous business men, Mr. John C. Claussen, the Vice President of the Crocker National Bank of San Francisco, when addressing the Ninth Convention of the Southern Commercial Congress held at New York City, pointed out that American business men, who have hitherto been reluctant to make outside investments, probably due to the fact that with the swift and extensive development of his country the natural tendency has been to invest his money in local enterprises and lands. But while it is true that such investments have largely contributed to the aggrandizement of his country, it is also true that in proportion of the growing of its resources there exists the danger that this preference to make investments on lands may some day cause the prices of these lands to go to the highest point, and therefore, it is advisable and desirable, Mr. Claussen says, that the accumulated capital at home should find new open channels for best benefit and advantage of Americans.

Now then, those channels are open to North American labor and capital in the beautiful land of Argentina. Its exceptional geographical situation, its vast and undeveloped meadows and luxuriant woods, healthy climate, wise legislation and social, commercial and political culture at the same level with the most prosperous nations in the world cordially invite your labor and capital to undertake all kind of activities. ___

Julio Zamora, Financial Agent of the Bolivian Government

Gentlemen: All of us, North, Central and South Americans congratulate ourselves upon this opportunity afforded by the Pan American Union for the purpose of discussing commercial and economical subjects. At this momentous time marking the conclusion of the greatest war in history, this conference permits us to reorganize our business and to lay the corner stone of normal life for all nations.

The most striking lesson for the South American Republics, learned since the beginning of the great War, has undoubtedly been a knowledge of the uncertain situation of the countries, constituting one Continent, and which bound by ties of neighborhood, race, language and history have neglected to live economically independent, due to the fact that they had overlooked commercial interchange among themselves.

Profiting by this experience, the leading men of the South American Republics, should direct their steps to effect a complete reorganization in the industrial field. They should promote preferably through a policy of reasonable protectionism the wide distribution of national raw material for manufactures, and should inaugurate a spirit of enterprise, so often lacking amongst some of our wealthy people. This would be the starting point for the commercial interchange between neighboring countries, and, therefore, would compel Pan Americanism in the future to be based upon very close economic relations, thus binding with even stronger ties, all the Nations that constitute the Americas, as these will be more firm than those created by Diplomatic channels.

South America possesses, herself, all sorts of products to amaze the world, with an overabundant production of whatever its needs may be. Each of the Republics has within its territory particular zones which render special products, and no doubt a day will come when South America will supply all the needs of the other Continents, a day when she will go “over the top.” But to make this fact a reality, South America needs capital and immigration. As regards Bolivia in particular, I can assure you, without any fear of contradiction, that nothing would please us, the Bolivians, more than to promote our industries and to settle our fertile, although now deserted agricultural regions, and to this end we prefer to interest American capital and American immigration rather than any other. For we have every reason to admire most heartily and to envy the gigantic activity and vigor of this country, that possesses along with a lofty democratic spirit, the gift of carrying out and organizing great and astonishing enterprises.

It is my own opinion that the duty now of the United States is to look forward to the commercial and industrial development of the countries of Latin America. I advocate the following reasons:

First: American solidarity demands the use of American capital in preference to any other; Second, the weakened and crushed condition of Germany makes it imperative for the United States to replace in the economical, commercial and industrial field all that Germany gave, loaned and purchased in South America; Third, because the War and the opening of the Panama Canal have operated to entirely change the commercial situation in that part of America, making of the United States the pivot of this movement.

Bearing these facts in mind, the United States will not accomplish the redeeming work so successfully started in the name of right and justice, if they do not give the necessary attention and care concerning the economical and industrial necessities of each of the South American countries, and in so doing this work will be of mutual benefit. It is essential to state that when we seek American capital or lay down commercial transactions before merchants and bankers in the United States we do not ask gratuitous favors, rather we offer extraordinary profits.

The United States of North America cannot excuse themselves for lack of capital, as they are to-day the wealthiest country in the world. If there is anything over and above—it is money. They should, therefore, lend their financial help to practical and profitable enterprises, provided, of course, they are duly guaranteed.

To accomplish this, they must accommodate their banking transactions to South American peculiarities, and it is essential that the leading banks of the United States, or an association of these banks, open branches in every one of the South American Republics.

The first and mutual advantage rendered by these offices will be the most trustworthy source of information for American investors on contemplated transactions, as whatever we may now say regarding the undeveloped resources of immense wealth of our territory; of our credit, and of the advantage of certain transactions, this information might be received with prejudice by those who think it is a question of mere propaganda.

It is, therefore, necessary that this information be transmitted by the American agents as quickly as possible, thus enabling speedy and trustworthy transactions.

I myself believe that the opening of branch banking houses in all the South American Countries, must be one of the endeavors of this Second Pan American Conference, as this involves the solution of economic and commercial problems.

Now, dealing with the Bolivian financial situation and necessities, I must state that the Bolivian people have realized that the most sensible thing to do in order to be in readiness for the natural development of its unexploited riches is to construct railroads; therefore, the collective effort of the Republic has been directed to their construction. Bolivia not only produces silver, gold, tin, tungsten, antimony, bismuth, copper, etc., as is generally known at the present time, but she also possesses fertile regions suitable for agriculture, wonderful plains for cattle raising on the North and Northeastern territory, and vast forest which produce all fruits and woods known to the world. Unfortunately exploitation on a larger scale cannot now be effected, due to the enormous distances separating these regions from the consuming towns or seaports.

With the desire to reach by rail the most distant and wealthiest places of the Republic, a plan was inaugurated in 1916 and a contract entered into with the National City Bank and Speyer & Company to construct a system of railroads by means of a Construction Company, capitalized with five and a half million pounds and secured as follows:—The American firms contributed three million pounds in debenture notes of first mortgage on the railroad to be constructed, and two and a half million pounds were subscribed by the Bolivian Government on income bonds issued on Second Mortgage, which are to be cancelled in the year 1932. This contract was duly and legally carried out by both parties. The roads were constructed and the capital entirely expended. These roads are now in full operation and their profits are increasing daily, thus confirming the expectations which originally induced the capitalists to undertake the work.

The Railroad System now completed and in operation comprises the following lines: Oruro-La Paz, Oruro-Cochabamba. Potosi-Rio Mulato to join the main trunk line of the Antofagasta-Oruro, and the line from Uyuni another station of the main system, towards the Argentine Republic, joining the Central Norte Argentino, which has the same standard 3 ft. gage as the Bolivian Railroads which is also the gage of the Arica-La Paz Railway. The completed system will link the Atlantic and Pacific Oceans by a railway starting in Buenos Aires, and terminating in Pacific Port of Arica.

The above shows the great international importance of this work in which completion the Bolivian Government is so keenly interested and for which it is seeking a million and a half pounds loan which will be explained further on.

The capital obtained through the Speyer contract was only enough to carry out the work of those lines as above stated, and it is the aim of the Bolivian Government to continue the extension of its Railroad System securing fresh capital and new contractors. Those lines to be constructed, or in the course of construction, are:

(a) Atocha-Tupiza Railroad, with an estimated cost of one million pounds sterling to join to the Argentine System. I have stated before the international significance of this road and I shall only add that it goes through a region of unexhausted wealth where the “Quechisla” and “Oploca” Mines are located. (b) Potosi-Sucre Railroad, now under construction by the Government. An estimate of one million pounds will be necessary for its completion. This line has industrial significance as it is the first to be extended into the productive eastern agricultural and petroleum districts. (c) Cochabamba-Santa Cruz Railroad. Surveys on this line are actually being made, and it is also very important, as it will branch the Speyer System to the wealthiest district of Bolivia, a zone which produces rice, sugar, woods and similar tropical products, and also cattle. The actual production of which is now very limited, due to lack of cheap transportation facilities. (d) Railway from La Paz to a Navigable Point on the Beni River. This itself means a very important route, running through vast and wealthy agricultural regions to heart of rubber plantations. It is now under construction by the Government with American capital. To start this work Bolivia secured a loan of five hundred thousand pounds, through the banking house of Chandler & Company, and this sum will only suffice to reach the Yungas Zone. Its principal production consists of coca, coffee, tobacco, fruits and woods. We now require the necessary capital to extend this line to the Beni.

Here, to interest capital on the loan required by the Bolivian Government, I want to point out the following:

The Speyer System, which runs through the heart of Bolivia, has been constructed with American capital, and will be the exclusive property of Americans the moment they return to the Bolivian Republic the two and a half million pounds which represents the share of the Bolivian Government on second mortgage bonds.

All the benefits of these railroads, and the increased value that they will attain through the development of the country, will also benefit the owners. There is no doubt that these four lines will ultimately be joined to the South American System of Railroads, and that they will bring into closer contact regions now far distant. These facts will be of such interest to American capitalists that the necessary funds that Bolivia needs for the extension of these lines will assuredly be forthcoming.

At any rate, this reflection is only a mere explanation and should not be considered as of general interest. Further on I will offer a thorough explanation of this question.

Bolivia, a young nation, wishes to place her name in a prominent position as regards international personality through sincere fulfillment of her obligations, and I here wish to call to your attention the fact that my country has never used the proceeds of any loan in unprofitable enterprises, such as war preparations, payments of debt, luxurious buildings or normal administration expenses, but has devoted these funds entirely to the construction of railroads and to constitute the Banco de la Nación Boliviana, which is the medium for the distribution of credit and which provides the means for commercial and industrial transactions of the country.

The following statement shows the outstanding balance of our loans:

Morgan Loan, 1918: Outstanding £362,000. This small sum has been bought in to the last cent by the Banco de la Nación Boliviana; therefore, the Government is relieved of any obligations to the above mentioned Bankers.

French Loan, 1910: Outstanding £354,000, which was allotted to the foundation of the Banco de la Nación Boliviana. The Bolivian Government retains all shares, and is authorized to offer these shares as a guarantee for any future loans now required. It must be added, here, that the management of this bank is carried on by the shareholders through an Advisory Board of five members, of which only two are appointed by the Government. The financial situation of this Bank is particularly remarkable, and successful, as may be seen by its semi-annual statements.

French Loan, 1913: Outstanding £946,000. The purpose of this loan is for the construction of the Tupiza- La Quiaza (Argentina) Railway, and was issued on bonds at the net rate of 90 per cent., 5 per cent. interest and 1 per cent. sinking fund. This loan was obtained under the best conditions, so far obtained by the nation, and only one-third of the whole amount has been spent up to the present time. The proceeds are in the hands of the Trustees, the “Credit Mobiliere.”

Chandler Loan, 1917: Outstanding $2,361,000 American Gold, for the construction of the La Paz-Yungas Railroad already referred to as being the first part of the Beni Railroad.

Outside of these loans, which added together, make a total of £3,134,000, the Bolivian Republic has no other obligations. Deducting from this amount £2,500,000, which the Concessionary Company owes the Bolivian Government on second mortgage of these Railways, and which are to be paid in the year 1932, the external public debt in reality only amounts to £634,000.

In order to show how sound is the Bolivian economical situation, I must also refer to her internal debt, which only reaches the figure of £2,400,000, including in this amount internal credits, military indemnities, loans for public works and similar obligations since the origin of the Republic.

Now then, adding this internal debt of £2,400,000 to the total amount of £3,134,000 external loans, without deducting the amount of railway concessions, we arrive at the conclusion that the Republic, with two and a half million inhabitants, only owes £5,534,000, which in American currency is $10. per capita.

The latest statistics which are available to show the financial conditions of some of the cities of the world points to the favorable situation of Rio de Janeiro, Brazil. This City lately obtained a loan of ten million dollars American currency. The latest statistics state through the firm of Imbrie & Company that her debt is $65. per capita: These statistics further show London with an indebtedness per capita of $120, Paris with $105; New York with $207; Baltimore with $114, etc., etc.

It is not only my intention to compare the resources of these great cities with those of my country just awakening to industrial life, but I believe the trifling amount of its debt is remarkable in relation to its population.

It is due to all these facts that Bolivia has never defaulted in the payment of the principal and interests of any of its funded indebtedness, which may be confirmed by the bankers who have loaned the money.

Bolivia is now seeking new loans and feels absolutely positive that she will again punctually meet her obligations.

Among the securities offered as guarantees .are presented, firstly: several internal taxes, which are now being deposited in the special accounts and which could be directly handed to the bankers, applicable to payments of interests and sinking fund. Secondly, the Government shares of the Banco de la Nacion Boliviana, together with their income. Thirdly, the two and half millions of sterling pounds in second mortgage bonds on the Speyer Railroads. Fourthly, the special mortgage of each of the railroads to be constructed, allowing the bankers the control they may deem necessary on the exact and complete investment of the principal; and fifth: internal revenue of the Republic.

My country requires also loans for public improvements, such as sewers, etc, in the principal cities, to be guaranteed by sound national revenues, which will permit a prompt payment and the securities for which could be deposited with the bankers who will make the loan.

Besides the Legation in Washington and the Financial Agent on a Special Mission, who has the honor of addressing you, Bolivia has a Consul General in New York who will furnish the necessary data, which may be required by those who are interested in our enterprises.

On my part, I want to add: Bolivian laws and public authorities guarantee personal freedom, property and the rights of foreigners, as well as those of their own citizens. Our political Constitution has been taken on its basis from the American Constitution, and is faithfully adhered to and observed by all. The Military caste, which in the first years of the Republic created agitations, has now totally disappeared and the Army is meritorious and the best guarantee for the national welfare. Political parties fight without hatred, and there is not a man who does not deeply realize that internal peace is the solid base of future progress of the country.

In conclusion, I wish to call your attention to the following commercial abnormalities: to European ports. For instance, a ton of mineral to English ports only costs £7, from the Chilean port of Arica, while the cost of same to New York is £9.

Second: The latest restrictions concerning the importation of tin, have greatly affected the Bolivian market, as that metal is Bolivia’s principal product. Under conditions of free trade it is particularly serious and extremely prejudicial to Bolivian commerce to prohibit the importation of certain metal into the United States.

For mutual benefit, I would suggest that these precarious measures be suspended. If our tin is not sold in the United States and converted into gold we cannot very well buy here our necessities.

I apologize for this lengthy address. I thank you for your most generous welcome, and wish success and prosperity to all the sister Republics herein represented. May closer bonds of sincerity and friendship unite them for common welfare and prosperity. ___

José Corbacho, Deputy in the Peruvian Congress

Mr. Chairman: Taking advantage of the recess of the Peruvian Congress—of which I am a member—I have made a trip to this great country, having as one of its principal objects to inspect the industrial centers, in order to take back with me to Peru a collection of samples of American goods, and also to become acquainted with the deficiencies of the commercial intercourse between the United States and South America, and concerning the complaints which have been formulated against the same.

No better opportunity could be offered to me than that with which the Director General of the Pan American Union has honored me in inviting me to make known before this Second Commercial Conference the data which I have been giving to merchants with whom I have come in contact since my arrival in this country.

In the following synthetic resume, I will speak with frankness, and although it may not be an agreeable task, I entertain the conviction that in treating commercial questions which aim towards a better development of the different countries, the language of diplomacy as well as every conventional formula which hides or disguises the truth and impedes the exact knowledge of the situation, should be set aside.

The usual international courtesy, which converts congresses and conferences into literary contests and acts of mutual eulogy, tend to make them move in a vicious circle, but without failing at the same time to sanction practical formulas.

Consistent with these principles, I take the liberty to transmit to the consideration of the Second Commercial Pan American Conference some of the many complaints which in South America are made against American merchants; to denounce the factors which contribute to weaken commercial relations; to point out a serious danger which is being presented in a large measure, and to state the measures which I consider indispensable, in order to save the commerce of this great nation from experiencing a breakdown in its relations with the Latin American countries.

It should be granted that American commerce was not prepared to enter into business with the South American countries on account of the lack of a better knowledge of the geographical conditions of each country and of the psychological conditions of their respective peoples; it should also be granted—as regards Peru—that to this ignorance have contributed the prejudice and falsehoods spread by these interested in the monopoly of their commerce and which have always striven in their eagerness to retain it, to ward off competition by misrepresenting us and depicting us as a savage, revolutionary and unreliable people, through publications which periodically and systematically are made in some of the New York dailies and which are energetically refuted by the Peruvian press. Thus, the unexpected intercourse, caused by the war, and without a basis of these two primordial factors—geographical and psychological knowledge—have produced a result unfavorable to the prestige of American commerce, because it has singled out some serious deficiencies and errors, and from which South American merchants have experienced real and positive losses, all of which have brought about a longing for the resumption of the former commercial relations with the European nations. I can summarize the main complaints formulated as follows:

Poor quality of some articles; higher cost of others with regard to similar European goods; tardy filling out of orders; lack of knowledge regarding climate; means of transportation, tastes, usages, customs and psychology of the people, etc., sending of goods of a different quality from those agreed upon, alteration in regard to the prices stipulated, in many cases increase of it on the merchandise already paid for but not sent; improper packing in some cases, and in other cases duplicating the value of same by their excessive weight; intervention of agents, commission people, etc., who charge excessive commissions, exploiting the producer and the client, preventing a direct understanding; difficulties for shipping; diverse taxes including those charged across the Panama Canal; losses produced by exchange, and, finally, the most serious of all, credit terms of very brief periods in some cases, and in others, refusal of credit by exacting a cash payment.

To the above should be added the plague of agents sent abroad, who speculating with the products of the houses they represent, are their worst enemies, and the most efficient means of disrepute to them. They do not content themselves with gaining a commission, but sell the articles fixing their own price at will. I will cite a case of an agent of an automobile firm which sells $1,000 cars in Lima, Peru, for $2,500. Another concern sells as brand new, second hand cars purchased in New York. It is sufficient for my purpose to cite these two cases to show the conspiracy of agents abroad against the prestige of American commerce.

Very much mistaken are those who think that with the downfall of Germany will disappear the menace for the peace and security of the nations of the world. Upon the ruins of that empire there has arisen another more imperialistic and more threatening in its tendencies, more dangerous on account of its practical methods and by certain ethical and psychological conditions superior to the white race, and more efficient in accomplishing their ends. Whilst the United States comes out in defense of civilization, as the standard bearer of Right, of Justice and of Liberty, with the weight of its great financial power and the heroic effort of her sons in the battlefield, on the other hand, Japan without waste of resources, and men, employed during the period of the world’s struggles, her activities and energies in pushing off the American goods from South American markets in order to occupy the place formerly held by Germany in the industrial and commercial world.

The tendency of Japan to expand towards the South American peoples, specially in Peru, was made known by the words uttered a few years by one of the Japanese Ministers of State, who declared in Parliament, that Peru in view of the reports which he had had from their agents, was the country selected for its expansion, because to the favorable climate conditions and natural richness, there were to be added certain strong racial analogies of a common origin. This most unusual declaration was not then taken seriously, and only some ironical and jocular comments were made by some of the South American papers.

To a period of study and preparation by means of able secret agents who fulfilled admirably their mission of investigation, under cover of the most humble services and trades, there is added their immigration to South America and specially to Peru in such an alarming manner, that at present it preoccupies the public as well as the statesmen in the solution of this great problem.

The culmination of the campaign of expansion developed by Japan during the last five years, remains graphically verified by the following facts: Establishment of banks and commercial exchanges in the principal capitals and commercial centers of South America; monopoly at present of commercial transactions relating to low priced articles, specially in Peru; great maritime activity by the increase of her merchant marine, consisting of modern transoceanic ships built in her own docks and which arrive weekly at the ports both on the Pacific and Atlantic Oceans, flooding the markets with articles adapted to the necessities of each country and at low cost and produced by 14,000 new industries; supplanting German goods by those made in Japan and of the greatest variety, from repair pieces for American and European machinery to electric lamps, plows, pianos, etc., publishing statistical data which reveal a progressive increase of marriages between Japanese and South American women; establishing colonics on some of the great rivers of the Continent; purchasing extensive tracts of land in several countries, carrying out an active and insidious propaganda and entering into secret treaties with some countries.

Such are briefly sketched the maneuvers of this formidable competitor which through the mouth of one of its most representative statesman, Minister Okuma, has affirmed not long ago that the South American countries at no distant date would form part of the Japanese empire, a bold declaration which was opportunely and eagerly refuted by a South American diplomat accredited in that country. In a word, sixty million of the yellow race are engaged in preparing the commercial, industrial and financial bankruptcy of the people of the white race.

All the facts which I have indicated and which affect and jeopardize American commerce in South America are not insuperable, if there can be brought about at once the meeting of the next Commercial Financial Congress in one of the American capitals, in which there shall be sanctioned, commercial treaties and a free interchange, creation of arbitral tribunals, etc., and recommendation of the nullification of restrictions, limiting the sphere of action of maritime commerce, amendment of custom house duties, reduction of postal tariffs, extension and cheapness of cable charges; repeal of taxes; shipping facilities, and a series of measures which will cheapen production and facilitate the interchange, resisting thereby successfully Asiatic competition.

Besides, it is necessary to send committees of investigation, like those sent by Spain, of representatives of the industries so that they may establish the actual conditions and the possibilities of the future, such as those of manufacturers and shippers from England who with a similar purpose are now on the way to South America; to establish permanent expositions; to grant economic facilities, such as long credit terms; to employ citizens of the respective countries where the exports are to be made; to send agents who know the language, and the psychology of the nation, and to eliminate commission agents, and middle men, thus establishing a direct communication between seller and buyer.

This, and much more which is not possible to enumerate, supplemented by efficient diplomatic consular services, and by the knowledge of the Spanish-American language and psychology, will surely ward off the crisis which is drawing near and which I have tried to sketch roughly.

I hope that you will excuse me for the apparent abruptness of my criticisms, and I beg you to bear in mind that any effort aimed at the conspiracy of silence is just and worthy of consideration.

From the factors above mentioned, will be seen the interest which prevails in my country for the success of a more intimate commercial relationship with the United States, and this is still more evident if we bear in mind that Peru from its independence from Spain in 1821, until the present day, has given proof of friendship, sympathy and adherence to the United States.

Peru is the cultural center, which, since the remote prehistoric times has impressed its civilizing influence from North to South in the South American continent; which during the Empire of Incas with its advanced spiritual culture, was getting ahead of the political ideal that the greatest thinkers of the century had preached; which during the Colonial times concentrated in itself the splendor and brilliancy of that historic period of America; which in 1850 was the first military, naval and economic power in the continent, and which is now marching by virtue of an infallible cyclic law, towards a new renaissance in the fulfillment of the prophecy formulated by the great Humboldt when he foretold that Peru would be towards the end of the century the center of a stupendous civilization, and, who after having studied and becoming acquainted with its colossal riches exclaimed one hundred years ago; “Peru is a beggar sitting in a bench of gold.”

It behooves North American capital to transform that bench of gold for the mutual benefit of all, and it should not be forgotten that the great Roosevelt has said that: “The coming century is the century of South America.”

The present time, therefore, cannot be more favorable for North American merchants and investors, because the people of Peru have in a democratic and overwhelming manner elected, as their president for the term beginning next August, the most eminent statesman which my country has produced in the last fifty years; Señor Augusto B. Leguia, who was, until very recently, the President of the Latin American Chamber of Commerce in London, which he founded.

When Señor Leguia was in Washington and New York, three months ago, he came in contact with the ablest statesmen and financiers of this country, and the press of the United States has given publicity to his ideas and plans for closer commercial and political relations, and for encouraging the investment of North American capital in the exploitation and development of the incalculable and inexhaustible wealth contained in the Peruvian territory, which have justly given origin to the proverbial Spanish expression “Vale un Peru” (It is worth a Peru).

A very important and decisive factor today ensures Pan American solidarity and brings the Latin American peoples closer to this country, a factor which has already gained the gratitude of the civilized world.

The sublime and noble doctrine given to the world by the greatest apostle of modern times, a man to whom, in the course of time, the words addressed by the Peruvian Indian Choquehuanea to Bolivar, the Liberator, would be fitting. Those words were: “With the lapse of centuries your name and your fame will grow as the shadow grows when the sun declines.”

Horacio Bossi Cáceres, “Opportunity for American Investment and Trade in Argentina,” Julio Zamora, “Pan American Finances and Trade with Special Reference to Bolivia,” José Corbacho, “Peruvian Trade and Internal Conditions,” in John Barrett and Julian Moreno-Lacalle, eds., Pan American Commerce: Past – Present – Future: Report of the Second Pan American Commercial Conference, Pan American Union, June 2-6, 1919 (Washington: Pan American Union, 1919).