226 



COSTA EICA. 



ASSETS. 



Real estate .......................... $663,199 



Tobacco and spirits in government j 



.' .'.' .'.' .'.' .' 1,115,400 $2,076,190 



LIABILITIES. 

 To Peru ............................ $140,500 



To the cities of Heredia and Sau Jos6 104,513 

 To sundries .......................... 182,857 



Exchanges, etc ..................... 269,184 $697,054 



Surplus .................................. ~$1,379,13<> 



It is, however, allowable to suspect an error 

 in these figures, and that on good grounds, in- 

 asmuch as one can scarcely accuse Costa Rica, 

 so long remarked for her punctuality in that 

 respect, of having about two and a quarter 

 million dollars deposited in the national bank, 

 and yet remain deaf to the clamorous outcry 

 of her European creditors. 



Here follows a transcript of the report pub- 

 lished in London, early in 1875, by the corpo- 

 ration of foreign bondholders, on the subject 

 of Costa Rica's indebtedness to Great Britain : 



In their last annual report, the council referred to 

 the appointment of a committee of seven-per-cent. 

 bondholders. It was then hoped that the united en- 

 deavors of all parties interested would result in an 

 arrangement satisfactory to the bondholders and 

 honorable to the Government of Costa Eica. 



In consequence of the prolonged default, and in 

 the absence of any steps on the part of the Govern- 

 ment to come to any arrangement with the bond- 

 holders, a special meeting, under the terms of the 

 general bond, was convened by Messrs. Knowles and 

 Foster, the agents for the loan, for the 7th of August 

 last, and Messrs. T. Farrer and E. E. Meugens, the 

 former an English merchant, long resident in the 

 country, the latter H. B. M. consul at Costa Rica, 

 were appointed receivers of the revenues generally 

 hypothecated to the bondholders, under tne super- 

 vision of a commission of six bondholders. 



The necessary legal documents were prepared, 

 and dispatched to Costa Eiea, duplicates being sent 

 through the Foreign Office; at the same time, Lord 

 Derby consented to authorize Mr. Sidney Lpcock, 

 H. B. M. minister-resident in Central America, to 

 support, unofficially, the interests of the bondholders. 



The documents above referred to were addressed 

 to the President of Costa Eica, but the Government 

 of that country declared itself unable to take official 

 cognizance of the appointment of the agents, on the 

 plea that the communications in question should 

 have been addressed to the Minister of Finance. 



The object of the Government appears to be to 

 gain time by any possible excuse, and in the mean 

 time to propitiate the bondholders as far as possible 

 by courteous treatment of their agents. 



Arrangements have been made by the commission 

 with the agents for the remuneration of the latter, 

 and with the council of foreign bondholders for the 

 provision of the necessary expenses of the agency, 

 as well as those incident to the appointment of the 

 special commission. Messrs. Knowles and Foster 

 Irave liberally contributed toward this outlay. 



Senor Nanne has returned to Costa Eica in order, 

 it is stated, to consult bis Government and to obtain 

 further powers ; meanwhile there is no immediate 

 prospect of an arrangement.* 



Additional light is thrown upon the question 

 of the foreign debt in the following extract 

 from a British financial publication, bearing 

 date November, 1875: 



There is some satisfaction in finding tbat one 



* For a detailed statement of the national debt, see ANNUAL 

 CYCLOPEDIA for 1S74. \ 



among tbe defaulting debtors of England professes 

 honest intentions. The Costa Eican embassador, 

 smarting under his contumelious usage by the Lord 

 Mayor,* declares that " the one desire of his Govern- 

 ment is to fulfill, to the very utmost, its obligations 

 legally contracted." More than this : " It has not, 

 and will not, repudiate its just debt," being only 

 " anxious to ascertain where its responsibility com- 

 mences, and where that of the other party ends." 

 As there is no reason to believe that Don Manuel 

 Peralta does not mean what he says, perhaps we may 

 be allowed to point out a very easy way of compass- 

 ing the end he has in view. When Costa Eica issued 

 her loans, she empowered certain commissioners to 

 manage the matter in such manner as they consid- 

 ered would be most advantageous for her own inter- 

 ests. They were her legal agents, and by their acts 

 she was and is bound. The bondholders, therefore, 

 have no part in the quarrel between the two parties. 

 Money was sent to Costa Eica on the strength of cer- 

 tain promises and hypothecations of revenues en- 

 tered into by duly-accredited agents of the state. 

 Her responsibility thus clearly begins with the due 

 payment of interest and sinking-fund charges to the 

 bondholders, irrespective of any grievance she may 

 have against the contractors. If Costa Eica has been 

 defrauded by her agents, it is open to her Govern- 

 ment to take whatever steps it deems most judicious 

 to recover the amount. Her creditors, however, 

 have nothing to do with this. They lent their money 

 on certain definite conditions, proposed by the au- 

 thorized contractors for the loans, and they look to 

 the Government, and not to any one else, for pay- 

 ment of their dues. When Don Manuel Peralta con- 

 siders the matter dispassionately, we feel assured he 

 will see it in this light. In former times, Costa Eica 

 was celebrated among Central American states for 

 the scrupulous punctuality with whicb she fulfilled 

 her obligations. Will she not return into this virtu- 

 ous path, now that, according to her own embassa- 

 dor's showing, she possesses a sufficient surplus of 

 revenue to meet the service of her loans ? He says 

 that tbe Treasury, " by dint of some sacrifices," paid 

 during the last financial year the sum of 194,000 

 over and above current charges, being sufficient "to 

 pay the yearly interest on both loans." These ex- 

 ceptional debts are given as the expenses for comple- 

 tion of the railway,t protested bills ; and a mysteri- 

 ous item styled " concomitant liabilities." Whether 

 similar charges will occur in future, Don Manuel 

 omits to state. If they do, it perhaps may be allow- 

 able to hint that the bondholders stand at present 

 in the position of parties possessing bills protested 

 by Costa Eica, and that their claims should, in com- 

 mon justice, receive equal consideration. We press 

 these suggestions on Don Manuel, because if Costa 

 Eica can be induced to set a good example in fulfill- 

 ing her national obligations, other defaulting states 

 may follow in the same path. Eepudiation has 

 proved catching perhaps honesty may display the 

 same characteristic. 



The exports in 1874 were of the value of 

 $4,906,000, of which coffee alone figured for 

 $3,711,558; the other chief articles being 

 hides, $68,094; India-rubber, $18,730 ; deer- 

 skins, $14,480 ; and cedar and mahogany wood, 

 $83,768. 



The shipping movements for the year 1873- 

 '74 were as follows : Entered at Punta Arenas, 

 92 steamers and 47 sailing-vessels, with an 

 aggregate of 136,301 tons, and 911 passengers; 



* Senor Peralta's name was omitted from the list of mem- 

 bers of the foreign diplomatic corps -invited to the inaugural 

 banquet of the Lord Mayor of London. 



t In the year 1873-'74, the outlay on account of the railway 

 was reported at $2,127,380 (see ANNUAL CYCLOPAEDIA for 

 1874); but in the year 1874-75 there figures in the financial 

 report a sum of but $559,457 expended for that purpose. 



