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It is with regret that I must now admit that the engagements which I had already made before I had the honor of receiving this invitation will make it impossible, in the time at my disposal, to do more than touch at Guayaquil for a few hours. Believing with you that " better acquaintance begets higher esteem," it will be to me a sincere pleasure and an occasion of gratification to meet such of the officers of your Government as may then find it perfectly convenient to be at Guayaquil. I shall seasonably advise the American minister beforehand of the time when I shall probably arrive at that port.

I beg that, in communicating this information to your Government, you will at the same time do me the favor to convey to it an expression of my best thanks for the invitation and of the great disappointment I feel at not being able to make my visit to Ecuador as extended and prolonged as I should wish. Accept, etc.,


The Ecuadorean Minister to the Secretary of State.

[Translation. )


October 26, 1906. Mr. SECRETARY: Confirming the agreeable interview I had with your excellency I have the pleasure to repeat in this note that I have received instructions from the foreign Office at Quito to state how much the Government and people of Ecuador regretted to be deprived of your excellency's visit on your recent trip to South America.

My Government regrets that conditions beyond your excellency's control prevented your reaching Guayaquil, where Ecuador would have had the hoped for opportunity to express their high esteem for your excellency and for the great Republic which you so worthily represent. I beg your excellency to be pleased to accept, etc.,


The Secretary of State to the Ecuadorean Minister.

No. 15.]


Washington, October 31, 1906. Sir: I have the honor to acknowledge the receipt of your kind note of the 26th instant expressing the regret felt by your Government at my inability to visit Guayaquil during the recent trip which I made to South America.

May I venture to ask you to be good enough to convey to your Government an expression of my sincere appreciation of its courtesy and my deep regret that circumstances rendered it impossible for me to visit Ecuador and to meet its distinguished statesmen? Accept, etc.,



Minister Lee to the Secretary of State. No. 23 B.]


Quito, April 30, 1906. Sir: I have the honor to inform you that yesterday, while conversing with General Alfaro, the Supreme Chief of the Republic of Ecuador, he showed me a letter which he had addressed to Colonel Gorgas at Panama requesting relief in regard to the yellow fever situation at Guayaquil. I had spoken of the matter before and am glad to know that the suggestion has been taken seriously. The situation at Guayaquil is a serious one and naturally menaces the port of Panama (Ancon).

If the Public Health and Marine-Hospital Service can take the letter of General Alfaro to Colonel Gorgas into serious consideration I am sure that the Government of Ecuador will be most grateful. Doctor Lloyd, of the above-mentioned service, is already installed in Guayaquil and does all that he can under limitations. The idea of the Government of Ecuador, however, seems to be to enlarge the powers of the quarantine officers of the United States. I regret that I can not inclose a copy of the letter. It was sent to Panama a week ago. I have, etc.,


The Secretary of State to the Ecuadorean Minister.

[Extract. ) No. 3.]


Washington, May 28, 1906. Sir: I have the honor to confirm the conversation which took place between us to-day in respect of the desirability of united effort on the part of the authorities of the United States who are now charged with the sanitary work in the city of Panama and in the Canal Zone of the Isthmus, and the authorities of Ecuador, for the more perfect reciprocal protection of each against contagious and epidemic diseases.

It will give the authorities of the United States very great pleasure to unite in friendly cooperation with the authorities of Ecuador to this mutually beneficial end to carry out the suggestion. Accept, etc.,




Minister Lee to the Secretary of State.


Guayaquil, July 19, 1906. Sir: I have the honor to inclose herewith (in duplicate) a résumé of a decree issued by the Government of Ecuador for the purpose of

fostering industries, manufactures, agriculture, pisciculture, and other similar enterprises in the Republic.

This decree is looked upon by the people as a very important measure, and it is hoped that ample results will follow. I have, etc.,




Considering that it is necessary to encourage the introduction and development of new industries in Ecuador; that agriculture in its several branches merits special protection; that the numerous mountain streams and waterfalls in the country offer abundant means of providing motive power and electric lights, favorable to the economical establishment of mảnufacturing industries; that it is indispensable to grant such guarantees and security as may inspire confidence and attract foreign capital for investment in the Republic; it is decreed :

ARTICLE 1. To concede the free use of the streams, waterfalls, and all natural waterways to all who may start in the country new manufactories employing hydraulic or electric force. This concession not to interfere with existing rights nor with the right to draw off water for irrigation purposes, as provided by the civil code.

ART. 2. To grant all such establishments concessions of vacant government lands up to 25 hectares of land with at least 200 meters frontage on the water supply used by the enterprise. If the factory be started upon private lands these can be expropriated legally by paying the value of such land as may be acquired, according to the valuation of two appraisers, as provided by law.

Art. 3. To grant 200 hectares of land to all who agree to start the cultivation of sisal hemp, ramie, tlax maguey, or other plant which produces material for textile fabrics.

ART. 4. Those who dedicate themselves to the cultivation of cereals or vines will have the concession of 50 hectares of land.

ART. 5. Those who engage in the raising of swine shall have permission to import animals for breeding purposes free of fiscal or municipal dues for the space of ten years.

ART. 6. All permanent lakes in the provinces of the interior which are more than 100 meters in extent shall be considered as national property and their use shall be conceded for a term of ten years to those who devote themselves to pisciculture. The lakes of Yaguarocha and San Pablo which are already stocked with fish are excepted from this concession. After the expiration of ten years fishing in the lakes will be open to the public. It shall be prohibited to draw off water for irrigation, etc., from such lakes.

ART. 7. Admits free importation of seeds and plants for ten years, but should such seeds and plants be offered for consumption, otherwise than for planting, they shall be considered contraband.

Art. 8. Exemption from military services of owners and employees of such factories, except as regards Ecuadorean citizens in case of foreign war.

ART. 9. From January 1, 1907, and for ten years thereafter, import dues and surcharges on manufactured articles imported into the country shall not be reduced in any case where similar goods are manufactured in the country already.

ART. 10. The same condition as in article 9 applies to any new industry which may be established hereafter from the date of its beginning and for ten years thereafter.

ART, 11. Refers to the same question of import dues.

ARTS. 12 and 13. Provide that duties on raw materials required for manufactures established or to be established in Ecuador shall not be raised or altered for a period of ten years.

ART. 14. Provides that goods manufactured in Ecuador can not be taxed to an extent more than 50 per cent of the total import duties charged on similar foreign goods and that goods produced from raw material grown in Ecuador shall not be liable to any tax or impost whatever for ten years from January 1, 1907, except in the case of sugar cane and tobacco products,

Art. 15. Provides that all people who have obtained concessions of government lands on the pretext of establishing industrial factories and who do not fulfill their project within two years of the date of the grant shall lose their concessions and the land shall revert to the Government.

ART. 16. Provides for registry of such industries, etc.

Art. 17. Provides for the exhibition of the products of such factories, etc., once in every three years.

ART. 18. That a government commission be appointed to study and encourage the establishment of new branches of industry.

ART. 19 to 21. Certain provisions as to cases where concessions are applied for by two or more persons, or by persons without sufficient capital, etc.

ART. 22. Provides that so far as may be applicable this decree shall be considered as incorporated in the custom-house law.


Supreme Chief of Ecuador. JULY 3, 1906


No. 36.]

Minister Lee to the Secretary of State.

GUAYAQUIL, July 23, 1906. Sir. I have the honor to report that the following-named railways are in operation or in project in the Republic of Ecuador:

(1) The Guayaquil and Quito Railway, a corporation holding a charter under the laws of the State of New Jersey. The construction of this line has been met by the issue of bonds and preferred stock, placed principally in the European market and guaranteed by the Republic of Ecuador. The annual payments amount to about $800,000. The Government of Ecuador has been borrowing money from local banks to fulfill their obligation in this respect. The road passes through tropical forests up the slopes of the Andes and through vast mountain gorges until it reaches the city of Rio Bamba, about 10,000 feet. This station is approximately 130 miles from Quito, the capital, and so far it is the last station on the road. The rest of the journey must be made in diligence or on horseback over the side of Chimborazo and across high rolling country to Quito.

(2) Bahia de Caraques to the cocoa district of Chone. The ad has been partially built (by funds locally provided by taxes on imports and exports) from the terminus for 2 or 3 miles in the direction of Chone, but is not yet in a condition to render any service in the conveyance of produce or merchandise.

(3) The Curaray Railway, from the interior to the Amazonian region of Ecuador. This road is also to be built with special funds set apart for the purpose and administered by local authorities. No actual work has as yet been done on this line. A staff of American engineers has been occupied in laying out the route and drawing up a report as to the course of the line and the probable cost. The difficulties are great.

(4) Manta and Santa Ana Railroad. A private enterprise obtained by a local firm, Messrs. Volcker & Guzenbach (German and Swiss), to run from the port of Manta through the tagua and coffee districts of the northern province of Manabi. It is said to have been taken up by a London firm. The low value of the principal product, tagua, offers little encouragement for the building of a railway.

(5) A railway from Guayaquil to Salinas, on the Pacific coast (cable station) has been proposed. The measure was carried through Congress in 1904 by a lawyer of Guayaquil, acting as representative of a foreign syndicate. Large concessions of land were granted to the company. The district is well adapted to raising of cotton and the line would pass through a tract of country prolific in pitch and asphalt wells (conceded to the company) to Salinas, where the salt supply of the Republic is obtained. Such a road would also obviate the necessity of the long and tiresome journey up the Gulf of Guayaquil and the River Guayas to the city. So far nothing has been undertaken.

(6) Santo Rosa to Zaruma. A concession obtained by a French syndicate and passed through Congress. No work has been done.

The line of the Guayaquil and Quito Railway (marked No. 1 in this dispatch) has been surveyed and leveled as far as the city of Quito. The progress of the work is delayed on account of the nonarrival of materials, rails, engines, etc. I have, etc.,


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