Second Pan-American Financial
Conference J. L. TEJADA S.
Bolivian Delegate
REPORT ON THE
Development of Commercial
Relations
BET^VEEN THE
United States and Bolivia

Address on International Credit
Address on Banking Co-operation

WASHINGTON 1920

Nff64 S63_
szot

, -, "/give thefe JBooAs
for the founding of a. College -in. this ¦ Colony".

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Gift of
Henry R. Wagner
1911

Second Pan-American Financial
. Conference

J. L. TEJADA S.
 ta 
Bolivian Delegate
REPORT ON THE
Development of Commercial
Relations
BETWEEN THE
United States and Bolivia

Address on International Credit
Address on Banking Co-operation

WASHINGTON 1920

REPORT ON THE
DEVELOPMENT OF COMMERCIAL RELATIONS
BETWEEN THE
UNITED STATES AND BOLIVIA

The meeting of the Second Pan-American Financial
Conference convened with the object of studving- the con
ditions of the different countries of America and the best
way to strengthen their commercial relations, offers a good
opportunity to present for the consideration of the busi
ness men and statesmen of this country a summary which
may show exactly the position of Bolivia as producer and
exporter of raw material and consumer of articles manu
factured by North American 'industries.
The importance of such study at this time is based on
two considerations. On the one side, mankind is busy
looking for the reconstruction of the world with econom
ical factors which may allow the re-establishment of the
wealth wasted during the war; on the other side, human <
energies saved from destruction are trying to find and de
velop new sources of production and how to increase them
through the medium of capital and labor.
The commerce of each country has its peculiarities and
requirements of individual character, and to know them in
detail would be equivalent to examine the determinant
causes of its progress, the elements that produced this lack
of action and the means that must be employed to make
a fact of the expectations which every country has to at
tract capital and labor. Bolivia has shown by actual results
attained lately that American initiatives and means of

work will find within its territory positive elements of
economical prosperity, guaranteed by. liberal laws and pro
tected by a fair application of them.
GENERAL DATA
It would be useless to go through the history of the
commercial relations between the United States and the
republic of Bolivia during the last epoch. I think, there
fore, that a clear, general statement of the conditions
that prevailed before will be sufficient to give an idea of
the causes responsible for the commercial isolation of both
countries whose undisturbed and friendly relations were
only of a diplomatic kind.
It is known that Bolivia, since the Colonial period, has
been and will be for some time, exclusively a mining coun
try. This does not mean that she lacks other kinds of re
sources, but the fact that the extensive and fertile agri
cultural and cattle raising lands of the republic are located
generally on the eastern side of the interior of the Andes
Cordillera, which entering Bolivia divides itself and
leaves in the center the great plateau of the Bolivian
"punas" (highlands).
That section, whose altitude reaches an average of over
12,500 feet above sea level is, of course, very poor in vege
tation, due to the peculiarity of the climate, the tempera
ture changing every few hours. The winter is dry and
bright. The sun shines and warms the soil without its
action being weakened by the clouds, and during the day
there is a moderate temperature on the "punas." At sun
set the temperature suddenly drops several degrees on ac
count of the cold winds blowing from the top of the high
Cordillera that surrounds the plateau. In winter it fre
quently occurs that in 24 hours the thermometer varies

55° F. between the coldest at dawn and the warmest at
noon. That part of Bolivian territory is the seat of one of the
principal American Indian races: the "Aymaras." The
arid appearance of the region is in striking contrast with
the wealth to be found below the surface.
In the middle of those cold plains raises the "Cerro de
Potosi," famous for its rich and exhaustless silver mines.
There are also located the mineral centres of Corocoro,
renowned for the abundance and wealth of its copper veins;
Huayna Potosi; Inquisivi, center of the richest wolfram
(tungsten) mines in the world; Uncia and Llallagua, the
most productive tin mines ever worked in the world; Cal-
quechaca, still older than Potosi and as abundant in tin
and silver; Pulacayo, Chorolque and Tasna from which
comes the world's production of bismuth.
The above-named districts, which are only a few of the
most renowned and rich mines in operation in Bolivia, ex
tend over an area of only 300 miles in length along the
Cordillera. We are assured by explorers and scientists that in no part
of the world has appeared, up to the present time, or will
appear, minerals in such compact form and richness as are
found in the Bolivian territory of the Cordillera of the
American Andes.
The western range of the Cordillera, from the north
ern part of Peru to the southern part of Chili, holds
copper. In Peru are the great copper mines of Cerro de
Pasco, in Bolivia the Corocoro mines-of centuries of pro
duction, and further south the wonderful copper deposits of
Chuquicamata, Collahuasi and the famous Braden mines
in the south of Chile, all on the western slope of
the Cordillera. In the eastern chain of the Cordillera,
nearly all of v which lies in Bolivia, the geological

formation is different and there is found the richest
veins of silver, tin, wolfram, bismuth and asbestos that are
known to exist anywhere in the world.
The mineral wealth of Bolivia, located in the two
branches of the Andes, has been developed ahead of the
other resources of the country, mainly because of the high
value of the mineral products and the facility of transport
ing them in such condensed form, and also because of the
proximity of the leading mining districts to the Pacific
Coast, which is reached from the heart of Bolivia by three
railroads — Oruro to Antofagasta; La Paz to Arica, and
La Paz to Mollendo, all of them connected with the na
tional system of railroads and which operate mainly in the
mineral region in the western part of the country.
The mineral products of Bolivia easily found a profitable
market in Europe, and to which practically all of them
have been shipped. The several reasons for Bolivian min
eral products going to Europe in preference to the North
American markets are as follows :
The reputation and importance of the European mar
kets, up until the last war, as the principal centers of dis
tribution was one of the main factors for that course;
the active and intelligent role played by the Europeans in
the interest they took in development of mines and the
mining industry; and that a number of the largest producing
mines in Bolivia were owned by individuals and companies
organized and incorporated in Europe, and operated from
there. The European banks, and especially the English banks,
gave great assistance at all times to the mineral industry of
Bolivia, offering loans and every kind of banking facilities
for the work and development of the mines, and accept
ing the consignment of their products.
The maritime communication between North America

and the Western Coast of South America was very diffi
cult, irregular, expensive and unsafe, and- at the only
Pacific ports available Bolivian products were accepted
for shipment more as a favor than as a right.
The stupendous and wonderful work of the Panama
Canal, benefits of which are now enjoyed by the world,
was not completed; the way through the Strait of Ma
gellan was used almost exclusively for ships bound to
Europe; and via San Francisco was not suitable for Bo
livian products to smelters and other plants whose center
of supply is New York.
Finally, the lack in the United States of smelting and
refining plants for the Bolivian minerals, nearly all of
which are exported in the form of concentrates with an
average of 60% of metal content, and it being necessary to
put them through a transformation which can be done only
by special plants before utilizing them for industrial pur
poses. England and Germany were the leading countries in this
kind of work, and, therefore, the Bolivian mine owners
had to ship their products there, as there were no smelters
for them in the United States, especially for tin, which
was and is the most important and valuable product of
Bolivia. Those were the conditions which compelled and made
the exporters and merchants of Bolivia to trade almost ex
clusively ' in European countries. It is plain to see that
this state of affairs did harm not only to Bolivia, but
also to the industries and manufacturers of North America.
The fact that the United States has become the greatest
consumer of tin in the world, having in her territory no
source of supply of the raw product, proves the above
statement. The American manufacturers were not at lib
erty to select their own market for buying that valuable

metal that has no substitute, but were compelled to go to
Europe for the product and had to submit to whatever con
ditions the seller chose to impose. Besides that, it cannot
be denied that the United States placed herself at a great
disadvantage and greatly injured her interests by depend
ing on the European markets for a product so important
and necessary to her greatest industries — tin plate, pack
ing and others.
That condition had to be adjusted sooner or later, and
the war did it, and thus opened up and made available for
the Bolivian mining industry all the forces of the Ameri
can spirit of enterprise. The result can onlv be mutually
beneficial. With the opening of the Panama Canal the Pacific Coast
of South America is in direct and rapid connection with
the North American markets of the eastern side, but with
insufficient transportation facilities.
The United States has at last entered upon the smelting
and refining of tin, the necessity for which was so im-
oerative. and thus she is connecting one of her principal in
dustries directly with the mining industry of Bolivia, which
from now on will find a suitable and profitable market in
this country for its products.
Another reason, althougn transitory, that nas favored
our products coming to this market is the exchange, or
the value of the American dollar in proportion to the
money of other countries.
The reason;, expressed in the foregoing paragraphs ex
plain clearly the causes of the unimportance during the
last few years of the economical relations between Bo
livia and the United States.

OUR TRADE BEFORE THE WAR
Little improvement has been noted during the years
preceding the war, as can be seen by the following figures
relating to 1913.
The total of the commercial interchange between the
United States and Bolivia was as follows :
Importation from the U. S. to Bolivia (Bolivian money) Bs. 4,044,103
Exportatioris from Bolivia to the U. S  '4 559,475

Total  Bs. 4,603,578
Difference in favor of the United States: Bs. 3,484,628.
The principal shipments from Bolivia to the United
States were:
Exportations from Bolivia to the United States:
FOODSTUFFS
Chuno (dried potatoes)  Bs. 100
Coffee, in grain and ground . . . ;  " 50
Bs. 150
RAW MATERIAL
Hides and skins  Bs. 1,252
Peruvian bark  ". 6,658
Matico leaves  " 380
Coloring, tanning and dyeing wood  ^ 785
India rubber  " 539,520
Total  Bs. 548,596
MANUFACTURED ARTICLES
Furs and skins  Bf- 246

Printed books 
Electric machinery and supplies.
Typewriting machines 
Steam .motors 
Machinery supplies 
Scientific instruments 

50
2,0002,400 540300
5,093

Total  Bs- 10-629
General total  Bs. 559,475

The foregoing data is taken from the Bolivian statistics,
as the American statistics do not give us any correct
information on the subject. It happens in most of the
cases that in preparing the statistics of the United States
the merchandise exported from Bolivia is considered as
proceeding from the country whose port has been used for
shipment. Bolivia, being deprived of an outlet to the sea,
is compelled to use a foreign port to ship her products.
This fact increases greatly and improperly in the sta
tistical figures the exports and imports of her neighbors
and diminishes her own, making her appear before the
world as a poor country without commerce and unable to
contribute either to her own or to the wealth of the world
on account of her insignificant exportations.
The Bolivian statistics show that previous to the war a
sort of commercial isolation existed between that country
and the United States.
In 1914, according to our statistics, the commercial in
terchange between the two countries amounted to Bs.
7,089,252 (Bolivian money).

IMPORTATIONS TO BOLIVIA FROM THE UNITED STATES
—1914
Foodstuffs. Value in Bs.
Lard  :  61,716
Flour  1,729,459
Vegetable oils  35,507
Liquors  1,759
Other articles  65,552
Total  1,893,993
Raw Materials.
Lumber  467,944
Kerosene  41,947
Coal  17,500
Other articles  97,337
Total  624,728
10

. Manufactured Articles. Value in Bs.
Shoes  79,108
Drugs  61,717
Cotton fabrics  441,568
Paper and cardboard  71,967
Printed matter  .'  196,960
Iron articles  291,211
Machinery  143,133
Wagons and carriages  74,508
Explosives  130,228
Other articles  727,628
Total  2,118,030
Grand total  4,636,751
The importations from the United States to Bolivia
were about the same as in the previous year, as will ap
pear by comparing the above table for 1914 with the
figures given before for 1913.
EXPORTS OF BOLIVIA TO THE UNITED STATES IN 1914
Raw Materials. Value in Bs.
Hides  14,909
Quinine bark  8,019
Rubber  779,253
Copper (native)  72,431
Tin  23,691
Copper ore  1,091,931
Other minerals  20,460
Te<*al  2,010,694
Manuiactured Articles.
Drugs ..  700
Woolen cloth  200
Printed matter  18,750
Pottery  25
Brass and copper articles  50
Typewriting machines  700
Objects of art  6,100
Total  26,525
Gold and Silver.
Gold ore  111,395
Silver ore  303,884
Total  415,279
Grand total  2,452,498

As appears above in 1914 Bolivia started to make her
exportation of tin to the United States. Previously it all
went to Europe. 11

OUR COMMERCE DURING THE WAR

Exportation^ from Bolivia to the United States
When the war broke out Bolivia fortunately had already
begun to take advantage of the American markets for the
sale of her products. That circumstance enabled her dur
ing the first months of the struggle to keep confident that
her development would not meet any obstacle in regard to
the restrictions imposed upon them for the free navigation
of the seas.
The conditions above mentioned, which restrained the
interchange of trade between the United States and Bo
livia, had disappeared, being substituted by those which
were precisely needed to encourage a more active com
merce. The Panama Canal offered better means of com
munication, and the newly-established smelting and refin
ing plants made possible the conversion of Bolivian ores
into metal bars.
Due to those two fundamental causes the demand for
Bolivian products not only kept up the prices for them,
but also increased them. Thus, nothing else was needed
in order to open up a powerful current of economical in
terest between the two countries. Increased facilities of
transportation, together with an extensive and remunera
tive market, are sure to result in increased commerce. Bo
livia showed it immediately.
Tin, that previous to 1913 had no importance in the com
mercial interchange, acquired a prominent place in our
commerce, as is shown by the following statistics :
Year 1913  Bs. 000,000
" 1914  " 23,691
" 1915  " 1,355,256
" 1916  " 3,461,243
" 1917  " 26,751,783
" 1918  " 46,381,587
12

Tungsten occupied a prominent place on account of its
different uses in the war industries, thus giving more in
crement to our commercial relations.
These are the figures shown by the statistics :
Tear 1914  Bs. 000,000
" 1915  " 823,488
" 1916  " 3,920,623
" 1917  " 6,392,926
" 1918  " 7,983,355

Antimony is another mineral that played an important
part in the war industries. Bolivia sent to all the allied
nations, principally to England, great quantities of this
product. The United States also greatly increased its im
portation of it, as follows:
Year 1914  Bs. 000,000
44 1915  " 1,199,561
" 1916  " 2,424,040
" 1917  " 1,978,591
44 1918  " 382,450

The exportation of copper to the United States shows
also a great increase:
Year 1914  Bs. 1,164,362
''1915  " 9,173,005
<¦ i9i« ' "  " 3,875,849
.< iq17 ""  " 1,711,923
" 1918 '.".'.".'.'.'  " 7,274,405

The agricultural products extracted from the Bolivian
forests are mentioned only as India Rubber and Quinine
Bark.

13

The year previous to the war our exportations of India
Rubber to the United States amounted to Bs. 539,520, and
in the succeeding years were as follows :
Year 1914  Bs. 779,253
" 1915  " 9,862,232
" 1916  " 12,101,781
" 1917  " 12,952,495
" 1918  " 9,312,141

The exportation of Quinine Bark from Bolivia is lim
ited, as the following statistics will show :
Year 1913  Bs. 6,658
" 1918  '• 107,861

Hides and skins are also a part of the Bolivian foreign
commerce. The exportation of this item to the United
States was as follows :

Year 1913 

 Bs.

1,252

" 1914 

 44

14,909

44

194,621

44 1916 

a

225,235

44

325,128

" 1918 

ti

148,574

Bolivia has started also the exportation of wool, though
not in a very noticeable way, due to the fact that the pro
duction of this material is used largely by the inhabitants
of the country.
The last years give the following figures :
Year 1914  Bs. 000,000
" 1915  44 44,504
" 1916  " S0.772
" 1917  44 135,737
" 1918  " 826,785
14

Making an extract of the foregoing data which shows
the increase of the United States in her role of buyer, we
come to the following comparative results:
Total value of the exportation from Bolivia to the
U. S. in the year 1918  '.  Bs. 75,991,792
Value of the same in the year 1913  •• 548,596
Increase during five years  Bs. 75,443,196
This increase shows that Bolivia exported to the United
States at the end of the war one hundred and thirty-seven
times more than the value of her exportations at the be
ginning of the struggle.
Importations to Bolivia From thc United States
The same reasons which prevented the development of
the commercial relations between the United States and
Bolivia and the shipment of her manufactured products
prevailed upon Bolivia, whose market was not important
enough for buying American manufactures. Otherwise, the
commerce of importation follows generally that of the ex
portations, in a direct line. A manufacturing country that
consumes the raw material sent by other countries is very
often the. provider of the manufactured articles to meet
their requirements. That is what happened during the de
velopment of the Bolivian commercial relations with the
United States. When the exportation of Bolivian prod
ucts to the American market was small, the importation
of American manufactured articles was also small. As
soon as the United States showed more activity in the con
sumption of Bolivian products she found a better market
in Bolivia for her products. 15

Before the war broke out the exportation to Bolivia of
manufactured articles from the United States was larger
than the importation of minerals and India rubber. Here
are the total figures for 1913 :
Importation of American products to Bolivia  Bs. 4,044,103
Exportation of Bolivian products to the U. S  " 559,475
Difference in favor of the importation  Bs. 3,484,728
At the end of the war in the year 1918 the foregoing
relation was entirely changed, due to the factors already
mentioned. The importation from Bolivia to the United
States and the exportation from this country to Bolivia
had both increased in a most noticeable manner, which
means that our commercial relations had been developed
and carried on satisfactorily, as is shown by the following
official figures :
Exportation of Bolivian products to the U. S  Bs. 75,991,792
Importation of American products to Bolivia  44 11,311,209
Difference in favor of exportation  Bs.64,680,583
The total increase of the commercial interchange between
both countries during the years 1913-1918 was as follows:
1913 — Total commerce (importation and exportation) .Bs. 4,603,57S
1918 — Total commerce (importation and exportation) . 44 S7,303,001
Total increase during the period of the war. .. .Bs. 82,699,423
Comparing these figures, we find that our commerce at
the end of the war was twenty times more than at the
beginning. The detail of our commerce of importation of American
products in 1913 was as follows: 16

FOODSTUFFS

Lard  Bs. 85,494
Flour  " 1,237,480
Other articles  " 276,953

Bs. 1,599,928

RAW MATERIAL
Lumber  Bs. 226,705
Mineral oils  " 54,238
Coal  44 10,086
Cement  4< 29,033
Others  " 40,607

Bs. 360,671

MANUFACTURED ARTICLES
Drugs  -.  Bs. 71,446
Shoes  " 88,059
Cotton fabrics  44 409,053
Printed articles  " 236,634
Iron sheets and bars  44 60,952
Iron articles  44 201,644
Mining machinery  44 68,506
Typewriting machines  4I 2,856.
Sewing machines  44 63,915.
Other machines  " 37,593
Tools for laborers  " 23,292,
Mining tools  44 10,384,
Agricultural implements  " 33,977
Railroad .cars and wagons  " 936.
Automobiles  " 1,855.
Guns and ammunition  41 65,767
Other articles  .." 706,625

Grand total of the exportation to Bolivia.

Bs. 2,083,502.
.Bs. 4,044,103

About the third part of our commerce of importation in
that year was foodstuffs. On account of the war the
United States prohibited the export of foodstuffs, keep
ing them to supply her army. Bolivia was thus compelled
to go to other markets to satisfy her wants.
The shortage of laborers and the new industries created
under the influence of the war placed the United States
in a position of inability to satisfy the great demand of the
whole world. In spite of this situation, our commercial

17

relations showed a favorable increase, as will be seen by
the following table relating to the principal items of
importation of American merchandise to Bolivia in the
year 1918:
IMPORTATION OF AMERICAN ARTICLES TO BOLIVIA
IN 1918
Foodstuffs  Bs. 1,113,112
Principal items:
Condensed milk  Bs. 193,049
Canned flsh and shell fish  " 156,696
Rice  " 207,920
Flour of wheat  44 283,007
Raw Materials  Bs. 2,572,694
Principal items:
Lumber  .'  Bs. 1,387,327
Metals  " 180,955
Mineral oils  " 816,257
Manufactured Articles  Bs. 6,875,402
Principal items:
Chemical products  Bs. 157,277
Leather (shoes and other articles)... 44 131,014
Wool and cotton fabrics  " 1,124,479
Manufactured metals  " 693,428
Machinery  " 1,281,328
Tools  " 164,639
Coaches and automobile wagons  44 650,745
Gold and silver  ' 750,000

As could be seen, all the great classifications of the Cus
tom Nomenclature of Brussels experienced a considerable
increase in the commercial interchange between the United
States and Bolivia during the war. The shipment of food
stuffs was less for the reason mentioned, but in raw ma
terial and manufactured articles the statistics show an in
crease of 710% on the first one and 330% on the second.
Once that we have examined the commercial relations
between Bolivia and the United States up to the end of the
war, we will be able to establish the proportion of this
commerce with the general commerce of Bolivia with the
other countries.

18

During the years since 1913 the Bolivian commerce has
been as follows :
Years. Exportations. Importations. Totals.
1914  Bs. 65,801,146 Bs. 39,761,222 Bs. 105,562,368
1915  " 95,210,350 " 22,574,566 " 117,784,916
i916  " 101,484,800 " 31,098,215 " 132,583,015
1917  " 157,748,054 44 33,480,831 " 191,228,885
1918  '• 182,612,850 " 34,999,886 " 217,612,736

The foregoing figures show that the commerce of Bolivia
'during the year 1913-1918 has increased in the proportion
of 206%.
In the year 1913 Bolivian exports were distributed
as follows:
Great Britain  Bs. 75,764,326

Germany France 
Belgium 
Argentina 
ChiU 
United States .
Uruguay 
Peru 
Other countries

7,973,739
4,571,838 3,172,236 913,846 590,517559,475 98,136 32,621
44,775

Bs. 93,721,513

The countries that exported their products to Bolivia
in 1913 ranked as follows:
Germany  Bs. 20,091,363
Great Britain  " 11,101,268
ChiU  *•  " 5,559,472
United States  " 4,044,103
peru  " 3,025,757
France '  " 2,058,112
Italy  " 1,303,199
Brazil  " 994,883
Other countries  " 6,571,849
Total  Bs. 54,750,006
19

As can be seen, the place occupied then by the United
States was far from being one of the principal ones in the
importations to Bolivia. As exporter to Bolivia she had
the fourth place, and as importer the seventh.
The year 1918, due to the influence of the factors before
mentioned, which changed the Bolivian commercial situ
ation, the relative positions of the countries which were
buyers of Bolivian products were as follows:
Great Britain  Bs. 91,027,797

United States
Chile 
France 
Argentina 
Uruguay 
Peru 
Brazil 
Other countries

75,991,792 9,574,347
2,764,934 2,225,014 514,454290,386170,214 53,908

During the war Great Britain maintained her superior
ity, which she had so long held, for Bolivian products,
while the United States reached the second place of im
portance. During the same period the total Bolivian ex
ports increased 206%, but the exports of Bolivia to the
United States increased in far greater proportion — one
hundred and thirty-six times greater, or 136 to 1. Great
Britain in 1913 received about 56% of the total exports,
and in 1918 it diminished 6% or to 50% of the total,
whereas the United States took in that year 136 times
more than in 1913.
It is, therefore, undeniable, according to the figures of
this study, that there has been a remarkable development
of, and increase in, the commerce of Bolivia with the
United States during the last few years.
20

In regard to the position of the countries which are pro
viders of merchandise to Bolivia, the following changes
occurred :

Country. 1913. Bs.
United States . . 4,044,103
Chili  5,559,472
Great Britain . . . 11,101,268
Peru  3,025,757
Brazil  994,883
France  2,058,112
Italy  1,303,199
Germany .... 20,091,363
Other countries. . 6,571,849

Proportion. 1918. Proportion.

%

Bs.

%

7.38

1^,311,209

32.31

10.15

8,089,67»

23.11

20.27

4,144,971

11.85

5.53

.4,368,511

12.48

1.82

1,029,222

2.94

3.76

676,406

1.93

2.37

355,956

1.01

36.50

53,109

0.02

12.22

4,970,823

14.35

In this section of our commerce, due, doubtless, to the
special condition of the American industries on account
of the war, the United States reached the first place among
the countries which supplied Bolivia with manufactured
articles.

21

FUTURE OF BOLIVIAN TIN IN THE UNITED
STATES
The producers and merchants of both countries, for their
mutual interest, ought to bear in mind the fine results grow
ing out of the war and try to give them permanency and
stability, now that the war is over and the world is turning
to its ordinary industrial and commercial activities.
Of the products which Bolivia can offer to the world
tin occupies the first place. At the same time that mineral
is classified as one of the principal articles that the United
States has to buy in foreign markets, as she has not in
her territory this metal and which has no substitute. It
is certain, therefore, that the production of tin in Bolivia
and its consumption in the United States will become a
powerful binding factor for the betterment of our com
mercial relations and will result in creating between both
countries bonds of closer friendship and mutual interests.
For many years tin has occupied the first place amongst
the Bolivian articles of exportation, as will be seen by
the following figures corresponding to the year 1918 :
Tin  Bs. 129,611,139 *
11,038,042
19,591,429 7,746,343
7,491,4224,435,1794,155,322 1,803,040
1,679,591 771,564
510,864
2,778,919

Rubber
Tungsten 
Copper 
Silver 
Bismuth 
AntimonyLead 
Wools 
Coca 
Hides 
Other articles

Total  Bs. 182,612,850
These figures show that tin represents 71% of the total
Bolivian exportation.
22

Regarding the position of Bolivia as one of the tin pro
ducers of the world, it will be seen in the following sta
tistical table taken from a publication of Mr. Adolfo Knopf
("Tin in 1919" — Washington Government Printing
Office) :

Country

1913.

1914.

1915.

1916.

1917.

1918.

Federated Malaya

State ....
50,930
49,820
47,520
44,570
40,470
37,970
British Protected
Malaya State
1,800 •
2,700
4,170
4,450
4,500
4,500
Bolivia
26,760
22,360
21,900
21,330
28,320
28,000
Banca ....
15,940
14,630
13,660
14,460
13,540
11,000
Billington and
Singkep . . .
5,300
6,090
6,760
6,760
7,300
9,200
China ....
8,390
7,120
8,000
7,630
11,800'
12,000
Siam ....
6,660
6,740
8,520
8,960
8,600
8,600
Nigeria .
2,950
4,590
4,630
5,150
7,070
7,000
Australia . . .
8,160
5,520
5,680
5,550
4,970
4,900
Cornwall . . .
5,370
5,140
5,060
4,770
4,000
4,000
Union of South
Africa .
2,050
2,000
2,050
1,900
1,540
1,500
Other countries
1,400
1,500
1,500
1,700
1,800
2,000
Total tons . .135,710 128,210 129,450 127,250 133,910 130,670
According to these figures the exportations of tin from
Bolivia represent approximately 30% of the total output
of the world.
In reference to the consumption of this metal the United
States required for her needs, as stated in the publication
above mentioned, in 1918, 82,854 tons or 64% of the gross
production of the world. No other investment could be
more remunerative and safe for the industrials of the
United States and serve them better than in encouraging
and developing the production of tin in Bolivia, whose
wealth in that line is almost a monopoly, and only a small
fraction of the regions or area containing tin has as yet
been developed and exploited. Every day there are new
and rich deposits discovered in sections never prospected
or worked before. Electric smelters for this metal would
be of the greatest help to our tin mining industry, as
smelting at or near the mines would avoid, or at least
23
reduce, the heavy expenses of concentration that requires
suitablebuildings and expensive machinery, which the
mines of small productive capacity cannot afford.
There is no doubt that Bolivia will soon become the
largest producer of tin in the world, and it will not be
long before her industry, duly encouraged by capital and
aided by the American way of work, will be able to supply
the full requirements of the United States.
During the last few years the price of tin has been
steadily going up, and it is quite certain that the price will
remain high, as new uses of tin in the industries are being
found daily, and its production, while it is rapidly increas
ing in Bolivia, in other countries it, is diminishing.

24

THE AMERICAN STATISTICS AND THE
BOLIVIAN COMMERCE
The main object in writing the foregoing chapters was
to show the business men of the United States the true
standing occupied by Bolivia as, a country and as a pro
ducer of valuable raw material in the three kingdoms of
nature. It is true that the figures given are small com
pared with those of other countries that are more devel
oped, but that do not look so very insignificant when it is
considered the many hindrances nature put in her way,
that she has no outlet to the sea and how far and high she
is from the coast. Nevertheless, bearing in mind the fig
ures of the last few years, which show a steady increase
of her wealth, and investigating her wonderful sources of
richness, we come to the conclusion that Bolivia is already
in a position to overcome the obstructions which may ap
pear in her future development, having an easy and per
manent outlet through the ports owned by her neighbors
on the Pacific Coast, until the justice of her case and the
righteousness and fairness of her claim may so impress
the world that she will be granted one or more ports of
her own.
The future industrial development of Bolivia depends
mainly on the investment of capital for the betterment of
her means of interior communications and the develop
ment of her industries. To accomplish this the North
Americans have the necessary elements, besides their re
markable spirit of enterprise in foreign fields and markets.
The statistics of the United States bearing its official
seal are accepted as facts in the business centers and
greatly influence business men. In the case of Bolivia they
place an additional obstruction to her development. The
25

Bolivian people, much to their regret, have to call attention
to the circumstance that the American statistics, as well as
the Europeans, place the commerce of Bolivia in a light
that is not in acordance with her economical capacity, her
commercial importance and industrial progress.
An analysis of the official publication entitled "Trade of
the United States with the World, 1917-1918," will prove
this situation to us. Page 71 thereof, in treating of the
articles imported by the United States from other coun
tries, lists the total commerce between the two countries
— Bolivia and the United States — -during the year indi
cated in the following thirteen lines:

BOLIVIA. 1918.
Articles grown, produced and manufactured in the United
States, returned  
Cocoa, or cacao, crude 
Copper, unrefined black  $ 37,050
Furs, manufactures- of  140
India rubber, etc. : Unmanufactured —
Balata 
India rubber 
Paper, manufactures of: Books, etc., and other printed mat
ter 
Sugar : cane 
Tungsten-bearing ore  82,542
All other articles  3,185
Total  .$122,917
It is natural to suppose that any business man whose at
tention may be drawn to some enterprise in Bolivia, whose
name perhaps he never heard of, will at once look at the
statistics of the United States to get some information
about the commercial importance and resources of the
country. His impression, of course, will be unfavorable
when he learns that the economical efforts of a country
which occupies an enormous area of the continent resulted
in 1918 to the ridiculous amount of $122,917
26

A detailed examination of the data referred to is still
more discouraging. Bolivia is proud of occupying the
second place in the world as a producer of tin.
When the American markets were opened for her min
erals Bolivia felt a real satisfaction and began to ship
her products to this country in considerable and ever-in
creasing quantities, as is shown by her statistics, based
on documents presented by the exporters to the Custom
House. It will be useless to look in the American statistics
for the value of tin shipped from Bolivia to this country.
In the figures named above Bolivia is not at all mentioned,
the American market appearing as getting its supply from
other South American countries.
The result wilL be the same if we try to find out the
commercial movement of other articles. It can be proved
that in the said statistics the greatest part of our products,
such as rubber, copper and tungsten, which compose our
commerce with the United States to such a high point, are
not even mentioned.
Let us make a comparison between the principal lines of
botn statistics : American Bolivian
Statistics. Statistics
Tin $  Bs. 46,381,587
Tungsten '. '.  82,542 ;4 7,983,355
Antimony  " 382,459
Copper  37,050 " 7,274,405
Rubber  " »-*?12.1^
Other articles  3,185 " 4,657,845
The real situation of Bolivian commerce has been, and
is, consequently, misrepresented in the official statistics of
¦ the United States.
The same objection can be made to the statistical sec
tion corresponding to the amount of merchandise sent by
the United States to Bolivia, found on pages 195 to 199
27

of the second part of the same publication, where the total
amount of the importations to Bolivia from the United
States reached in 1918 to only $3,516,054.
These figures are also lower than those appearing in the
Bolivian statistics, but they are nearer to them than those
related to the value and quality of the Bolivian products
exported to the United States.
A more careful examination of the statistics in question
leads us to the conclusion that the misrepresentation of
figures is the principal cause for the results, less favorable
-than was expected for the encouragement of the commer
cial relations between the United States and Bolivia, plac
ing her before -the eyes of the American people as a human
•group without trade and without any standing in the com
mercial interchange of the world.
The reason for such misrepresentation in the statistics
¦cannot be other than that the production of each article
listed is not. credited to the country of origin, but to that
¦country through whose port the shipment has been made.
It is well known that the United States is a great con-
-sumer of tin. It is also a universal fact that in the world
outside of Bolivia there are very few countries that are
producers of tin, and none in America. The figures
proving this assertion have already been given.
Bolivia, not being mentioned in American statistics as
a producer of tin and as supplying the United States, it
will be of interest to inquire from which countries she
obtains her supply.
Reading at pages 74 and 75 of the official pamphlet,
"Trade of the United States with the World, 1917-1918,"
-our inquiry is satisfied only in part. The United States ap
pears as crediting to the Republic of Chile the export of tin
to the amount of $9,356,284. 28

On the importations from Peru (page 80) appears in the
same year $771,657 as the value of the tin sent from that
country. Thus in the official statistics of the United States-
and published by the Government the tin of Bolivia shipped
to the United States is credited to two neighboring coun
tries that do not produce or have in their territory a pound
of that mineral.
The necessity of giving more accuracy to this kind of
data is becoming daily more urgent, so that it may become
and be depended on as a source of reliable information by
the American business people who are eager to know the
true wealth and importance of a country, its resources and
its share in the general trade and welfare of the world.
The future commercial relations between Bolivia and the
United States may depend to a large extent on the ac
curacy of such information.
Bolivia desires and needs to have all her riches and
resources thoroughly known. She does not fear the mod
esty of her present statistical figures compared with those
of other countries, because they are at least a proof of her
endeavor and perseverance to overcome the hindrances
and handicaps which nature has placed in her way. Up
until now she has been proud of and encouraged by her ac
complishments and the fruits of her efforts, small as they
may appear to Americans. She is confident that
her development on a larger scale will not be delayed if
she is able to interest and get the help to a certain extent
of the economical energies and financial powers of this.
great country.
In view of the insignificant position given to the indus
tries and commerce of Bolivia it can be seen very clearly
that to give her a port of her own on the Pacific Coast
by which she would assume her international personality
and be placed before the other countries of the world ii*
29

the rank and place to which she is entitled, would be only
and purely an act of justice, and the claim of such a port by
Bolivia is not a political fantasy or the expression of an
idea of territorial restoration based on patriotic feelings,
but represents a true economical necessity. This necessity
not being arranged by friendly and justified means, sooner
¦or later will produce a very strong pressure of interests,
powerful enough to be able of themselves to open for
her an outlet to the sea as an essential condition of guaran
tee and independence.
A hindrance to the rapid development of these commer
cial relations which are so necessary at the present moment
for the increase of Bolivia's production, is, without doubt,
the pernicious influence which the official statistics of the
United States have had on the business men, which statis
tics, bearing official seals, are doubtless accepted in busi
ness centers as correct results and consequently officially
verified facts.
Then, it is alas, regrettable that the Bolivian people must
call attention to the fact that North American statistics, as
-well as all European statistics in general, represent Bolivian
commerce by figures that absolutely do not correspond to its
actual economical capacity, nor to the reality of its
commerce. The following diagram has been made from the Official
Statistics of "Bolivia relating to and in order to show the
commercial development of the United States and Bolivia
during the years 1910-1918:

30

Chart Showing Trade Between the United States and Bolivia, 1910 to 1918

OO

OBSTRUCTING CAUSES TO A LARGER DEVELOP
MENT OF COMMERCE BETWEEN THE
UNITED STATES AND BOLIVIA
During the war the commerce of Bolivia and the United
States could have been much larger than the preceding
figures show were it not for the interference of some cir
cumstances which it will be worth while to state. Now
that the world has regained its normal condition, there is
no doubt that these hindering circumstances will disappear.
The United States prohibited the importation of cop
per ore and concentrates having a metallic content less
than 50%, and that order was followed by another that
restricted the importation of Bolivian tin ore and con
centrates. American business men know, without doubt, the harm
ful effects of such restrictions to commercial relations be
tween countries. They were issued doubtless because of
the war, but the effect of the restrictions might again be
caused for our tin, perhaps not by official order, but be
cause of the insufficient capacity of your smelting and re
fining plants.
Nothing is more disappointing and discouraging to a
miner working under such unfavorable conditions and in a
far-away country, like Bolivia, to be compelled to cut down
his production because of outside restrictions and the lack
of facilities to market his product.
For the successful exploitation and operation of a mine
it is necessary to have a live working equipment and .a
complete organization which turn easily into a chain of
losses if for any cause they have to stop or reduce their
normal course of work.
A somewhat similar, but perhaps more detrimental, effect
often results from the manner in which financial assistance
32

is given. The ideal of every business man, without doubt,
is to find good financial and commercial connections
whereby to develop a mutually profitable business, and that
desire becomes a need of small enterprises whose principal
basis of operation depends on the commercial morality of
the connection and client; faith and confidence in their
manner of working, resources and possibilities. Connec
tions of this kind, then, cannot and must not be subject
to alternation between action and inaction, compliance and
hesitation, promises kept and broken, for when they are,
whatever the cause might be, they result not only in the
disorder of small organizations and reduced production,
but also in distrust, discouragement, uncertainty and losses,
which in turn impedes development and sometimes results in
ruination to the enterprise.

Another important point for the maintenance and de
velopment of commercial relations between the United
States and the American countries is doubtless the adoption
of a resolution to the effect that all raw materials exported
to the United States by American countries will not be sub
jected to import duty. Only absolute equality and reci
procity in commerce between the United States and the
Latin nations of the South will bring about an appreciable
increase in trade. The bills introduced in the Congress of
the United States providing for a duty on raw materials of
South American production, to the end of excluding same
from the markets of this country, such as has been pro
posed with regard to tungsten or wolfram ore, marks a
tendency that can end only in bad results.
If the bill relating to tungsten was presented with the
idea that the tungsten (wolfram) supply for North Ameri
can industries may become exhausted in South America
and that it is advisable to stimulate the production of that
33

metal in this country, even by an increased cost to the con
sumers, thus impeding and handicapping South American
commerce, there is still time to point out that the origina
tors of such a bill do not fully understand the subject. The
tungsten deposits in Bolivia are so great, in fact they are
unlimited, both as to extension of the deposits and their
producing capacity, that the United States can always be
assured of an abundant supply for her industries, and with
out having recourse to a means that would initiate a series
of reciprocal exclusions and restrictions, which cannot be
tolerated if America really desires to use her capital, ener
gies and facilities to satisfy the needs of humanity, and at.
the same time encourage and develop her own industries.

During the period of the war it could be observed that
the commercial relations between the United States and
Bolivia were seriously interfered with.
It is undeniable that the severity of the restrictions
placed by the allied gbvernments on the enterprises and in
dustries owned, exploited or promoted by. subjects of the
enemy countries was a powerful factor in the economical
struggle which played such an important part in the war
and which certainly greatly hastened its end.
In remote countries like Bolivia the almost discretionary-
administration of these restrictive measures during the war
was practically exclusively in the hands of representatives-
of other nations allied with the United States, and they*
never lost sight of the interest of their countries. Many
neutral interests, friendly to the States, were hurt for the
sake of helping and favoring allied subjects.
In entering upon this new epoch of commercial relations
and industrial development it is necessary to bear in mind
these antecedents in order to show the necessity of reor
ganizing- the Diplomatic and Consular services of the
34

United States in the Latin American countries to the end?
that that important branch of the American Government
can be useful in developing rapidly and to the highest point
the diplomatic and commercial relations between these
countries and the United States.

Another fundamental cause impeding a further develop
ment of commerce between the United States and the coun
tries of the South, especially Bolivia, is a financial diffi
culty connected with the various banking operations that
must be effected between South American clients and their
correspondents in this country for the management of their
business and sale of their products.
European consignees habitually accorded their clients the
right of drawing on them, through 90-day sight drafts, for
75% or 80% of the value of their shipments. In this way,
and in most cases, the owner of the mine could at the time
of shipment reimburse himself the production and shipping
expenses, while the consignee would make no disbursement
until after he received the produce and had chance to sell it.
The situation brought about by the war no doubt tended
to restrict credit, but, aside from this perhaps inevitable
and unforeseen condition, American methods of cash and
sight-draft payments for products sold, are completely con
trary and hostile to the long-established system of the South-
American countries and to which they are so thoroughly
accustomed, and which system enables the producers in such
an easy and inexpensive way to finance themselves and
carry on their work. Deprived of such an excellent and
long-established system of financial assistance the majority
of the small and medium producers and merchants must
decide between limiting their production and trade or make
arrangements with intermediaries which is both expensive
and inconvenient, and consequently exceedingly detrimental
to a free development of the industry or business.
35

In citing the difficulties these nations encounter in their
¦commercial relations with the United States it is important
to call attention to the lack of uniformity in weights and
measures. If the decimal metric system, already accepted
by and in force in Europe, Asia, Africa and Australia, and
practically in every country in Central and South America,
cannot become the only system of weights and measures
cf all the Americas, it seems at least for the purpose of
helping trade and preparing the way for its adoption by
the United States, that an arrangement might be made
-whereby American prices and documents might for the
present and temporarily be drawn up both in the weights
and measures used by this country, and the equivalents
thereof in the decimal weights and measures. In this way
manufacturers, business men and agents which un
doubtedly immediately realize the advantage of the decimal
system and in a short time it would surely be permanently
adopted.

One of the worst enemies of American foreign trade
development is bad packing. It must be born in mind
that freight destined for the countries of the South is subject
to very rough handling and many transshipments and should
accordingly be especially and carefully packed. It is easy
to imagine the disappointment and discouragement, to say
nothing of the direct and indirect losses, to a miner who,
after having found or acquired a mine, spends many
months in preparing it, and has started taking . out ore,
¦orders the machinery he thinks best for his mine, pays the
full price in advance, and cherishing the hope that soon
after he receives the machinery he will be reimbursed all
the capital expended, and finally, after months of delay,
the shipment reaches him, and instead of receiving the
machines he ordered and fit for service, it arrives badly

36

broken and with many parts missing, all because of bad
and careless packing. Certain it is a man so badly treated,
his hopes crushed and perhaps ruined financially, will not
only never order another piece of machinery from the same
house or from the same country, but he will warn the pub
lic and his friends. This is not an exceptional case, but
one that only too frequently occurs.
American manufacturers and exporters must be more
careful in packing their merchandise, and if they will it will
surely redound to their credit and greatly increase their
trade. Undoubtedly one of the causes that contributed to
making the South American countries easily made and
valuable customers and business friends of Germany and
other European countries was the extreme care taken by
their exporters in the packing and shipment of merchandise.
Certain American agents in Bolivia once asserted that
bad packing resulted in an increase in business, because the
consignee was reimbursed for lost or damaged merchan
dise by the insurance companies, and consequently sent a
new order to the manufacturers, thus resulting for the
manufacturer and exporter two orders instead of one. If
rhis were the general way of thinking and practice followed
commercial disaster would result. The manufacturers and
merchants of remote countries do not order material for
the immoral purpose of getting excessive insurance, but
for the laudable purpose of making a fair profit by selling
the merchandise, or using the machinery, and so when
their hopes and plans are frustrated, they will ever after
ward steer clear of that market that treated them so dis
honestly and caused them troubles and losses.

All these particularities in commerce, banking opera
tions and transportation must be better known and under
stood by American exporters and bankers who are not as
37

jet familiar with the exceptional conditions of the southern
..countries. It will also be necessary for us to become more
intimately acquainted with the manner in which the United
States does business, which is considerably different from
that which the European nations have taught our people
through the maintenance of strong and active commercial
relations for several centuries. Perhaps one of the best
ways of obtaining an immediate and certain result in this
.direction would be through an agreement between North
American bankers and exporters and South American mer
chants and bankers upon a periodic exchange of employees
of guaranteed integrity and absolute competence to work
for some months for firms within the countries. Surely by
ihis means our special conditions would soon become
known and we would all obtain greater benefits.
Everything tends to indicate that the Americas are
on the eve of undergoing a powerful industrial transfor
mation and that its enormous resources will some not far
.distant day be beneficial to all humanity. Even she does
not fully know her resources and potentiality. Now more
:so than at any other time there is greater interest in know
ing the resources and treasures each American country
possesses, and to study each one with the object of deter
mining just how the production of the most important
native exportable articles can be increased, and also to de
termine the countries having those natural resources most
abundant and most valuable in quality, needed in the
United * States, and which may be selected as sources of
supply. As reliable information is now being sought on every
hand there is, it seems, no more favorable time than the
present to initiate the opening of a great Exposition of
Pan-American products, which later would surely grow into
.a permanent museum and an office of Pan-American infor-
38

mation. Such an exposition would reveal the natural and
manufactured resources of the three Americas. Such an
institution would be very useful in reorganizing the indus
trial conditions of the world on more satisfactory and ad
vantageous basis and conditions than existed before the war.

Bolivia is a nation economically complete if its natural
resources are taken into consideration. No country on
earth, large or small, can show such a variety of mining,
agricultural, forest and cattle resources within the limits
of its own territory.
Industries will find there their requirements for intense
development, and man will not only be able to make use
of her products and resources, but in doing so he will be
able to choose the climate most suitable for his health an!
energies, as nature has crowned her gifts to this country
by placing her territory in the middle of a geographically
tropical zone with high mountains which lower the hot
climate of the tropics and going to higher altitudes the
climate gradually changes from temperate to arctic tem
peratures. During the past this great reservation of resources for
humanity, unjustly hidden and unexplored in the interior
of a continent, has been and is still being worked and' cul
tivated in a modest way it may be, but with faith in the
future and perseverance to prepare and lay the basis of a
great economic development.
The obstacles placed by nature in the way of communi
cation and transportation can only be overcome by means
of good modern roads, rail and auto, and notwithstanding
their cost, B olivia is determined to have them. She has
already constructed some, the trunk lines of a carefully and
well-planned national system, and firmly intends at what
ever cost or sacrifice to extend and complete them. Very
39

soon she will be able to invite five of her neighboring sis
ter republics to carry on a more active and profitable com
merce among each other by using her railroads, which will
soon be connected with the lines of Argentina, Uraguay,
Paraguay, Chile and Peru ; and when the extremities of
her proposed new lines running eastward are connected
with the Brazilian lines and reach the navigable banks of
the great tributaries of the Amazon, and the coast of the
Atlantic, all the southern part of South America will be
able to communicate from ocean to ocean, by traversing
Bolivian territory, and thanks to the vision of Bolivian
statesman and the material sacrifices so willingly made
by the Bolivian people.
Bolivia needs and desires to have the financial and in
dustrial co-operation of all men of enterprise and good
will, and particularly those of the United States. She
wants, to have associated with her in her national, eco
nomic and industrial growth and development those noble,
capable, creative men of North America, those master-
builders and captains of industry that fear no obstacles,
either of nature or man, when they set out either to build
or protect nations. For Bolivia to become one of the most
useful countries of South America to' the world and all
mankind she only needs the magic touch and whole-heart
ed assistance of such men with their brains and skill, their
commercial morals and indomitable will power, and the
capital and forces they so deservedly command. Bolivia's
greatest national joy will be when she hears that men of
that type, that created and built so well in their own coun
try, knocking at and sees them coming through the doors
of her shut-in and shoreless borders with the object of
aiding her in all her worthy aims and just claims; to show
her how and to aid her to develop her resources, and show
her how to attain her material and spiritual ideals; how
to add something to the corner stone of the new democra
cy; how to best serve her sister republics and mankind;
and lastly, how to follow in the footsteps of her big broth
er — the United States — in whom her faith and confidence,
like her admiration and esteem, are both as unbounded
as they are sincere.
Washington, January 19, 1920.
J. L. Tejada S.
40

Address by Mr. J. L. TEJADA S., Delegate
of Bolivia to the 2d Pan-American
Financial Conference, January 23d, 1920
Mr. Chairman, Fellotu Delegates, Ladies and Gentlemen:
I am going to make use of the time so graciously granted
to me by the Chairman in these last hours of the Confer
ence, by presenting- to your attention and for your con
sideration a matter and suggestion that I believe to be
not only of general interest to all our Pan-American coun
tries, but will show the way to our big brother, pur host
on this occasion, how he can in a single action render finan
cial help to stricken Europe and at the same time be of in
calculable assistance to his sisters, the Latin-American Re
publics, whose interests and welfare it would seem he, the
United States, does not consider to be of inferior import
ance or concern to him, than those of the countries of
Europe. The matters concerning- and especialy interesting to the
country, one of whose representatives to this important
Conference I am proud to be, have been, with the aid
of the Bolivian Group Committee, sufficiently discussed
and satisfactorily arranged, and the general conditions of
my country, her resources, aims and possibilities, and, I
might say, her moral and material ambitions, are set forth
in detail in the reports of the Bolivian Delegation that we
now have ready to deliver to the Secretary of the Confer
ence in order that they may be included in the published
proceedings of this Conference.
Unfortunately the time, ten minutes, allowed by our
consent to the delegates occupying this tribune, is hardly
long enough to fully explain a matter of so much import
ance to us all, but do not fear, for I will confine myself
to the main point and be as brief as possible. There are,
41

however, some ideas and propositions that are self-evident
and do not require elaborate presentation. I desire here
to say that it is a great privilege to address an audience
that is familiar with all the details of economic and finan
cial problems and is able therefore to see the importance
and consequences of such a matter as I am about to propose.
In our second general session we had the privilege of
hearing and so much enjoyed the very able, interesting
and instructive address of the late Secretary of the Treas
ury, Hon. William G. McAdoo. We listened to him with
sincere feelings of appreciation, because his superior in
telligence and wonderful experience enables him to always
go directly to the very root of every problem, and also
because of what it is such a pleasure for me to say, we
know him as the founder and promoter of this phase of
practical Pan- Americanism, which has taken the shape of
these valuable conferences.
Mr. McAdoo pointed out and explained to us the real
situation of the world, and expressed it as his opinion that
America, I better say the Americas, must continue to help
Europe in order to aid in the reconstruction and reorganiza
tion of the reduced nations of the old world. He said
that our American countries must send to Europe the raw
materials now so vital over there, and also allow credit to
those countries in order to help them carry out their recon
struction and reorganization plans.
This is, I think, the greatest problem of today. All the
economic conditions of the world now grow out of the
necessities of European countries, and though the condi
tions in the United States and the republics of Latin- Amer
ica are different from the European, the one acts immedi
ately on the other.
We know that we must send not only raw materials, but
food and money, to Europe, and we want and intend to
42

do it, but the trouble of today is that all this interchange
of commodities and the financial operations necessary for
them is hampered by the upset conditions of exchange that
has so altered the parity of the money of the principal
nations of the world.
It cannot be said that the dollar has now the same
value than it had prior to the war. It may be that the in
creased cost of living has deprived your dollar of a large
part of its purchasing power as is undoubtedly felt by
you all, but it is a certain fact that all European money
has been greatly reduced in value when compared with the
dollar. Now, what is the economic effect of this fact? It is
that commerce with Europe has been nearly completely
interrupted because the money with which Europe pays
for the commodities she buys is of reduced value or pur
chasing power. On the contrary, the money of the United
States is now in every foreign country quoted higher than
at any time in your history, and that is why our commerce
with you is so much increased and will continue to in
crease. But commerce has two phases — first, the imports
to your country; second, the export of commodities. With
the actual situation of exchange, importation to the United
States is stimulated, but exportations are seriously handi
capped, not only by the increased cost of goods on account
of the high price of labor and materials, but also by the
actual value of your money.
Therefore, in order to readjust the economic relations
of the world and arrive somewhere near pre-war condi
tions, the problem to be solved is normalization of ex
change. That may come, and, indeed, it certainly will come, be
cause of two economic factors: first, by the natural devel
opment and increase of production and exportation whereby
43

the European industries will again be fitted for work, am!
then be able to provide the necessary articles to meet the re
quirements of their starving and unclothed populations ;
and, second, by credit. The first is a matter of time,
and the second a matter of finance. But, as capital granted
in the form of credit is, as you know, time loaned to the
debtor, that is to say, it represents the necessary time, tak
ing into consideration the resources of the borrower, to
produce the amount of capital loaned to him, we come to
the conclusion that the necessary time for reconstruction
and readjustment may be anticipated by credit.
Mr. McAdoo established quite clearly that America
must grant credit to Europe. We all agree with, him as to
that. Indeed, that is the only way to save her from com
plete disaster, and you will be forced to enlarge European
credit in order to avoid actual monetary and financial dis
turbances. Starting from this point of view, let us consider what
would be the best way to grant such credit to Europe.
Direct loans subscribed by American investors or by the
American Government do not seem to be very attractive
or now practical. Loans granted in that way during and
after the war amount to very high figures, and it seeni*-
that the borrowing nations are not able to even pa}- the in
terest on the existing loans.
Therefore, it is necessary to look for another way of
granting credit to Europe and helping her in her restora
tion and development without increasing thereby her debt
to the United States.
All Latin-American countries have been financed by
Europe during the last century. Nearly all our national
debts and the debts of our big financial and industrial or
ganizations are in hands of European investors. We are,
therefore, debtors to nations that have helped us in our
44

development, and morally obligated to return to them the
savings they loaned to us and thus fulfill their trust in our
economic solidarity. Now they are in need of the money
they loaned to us for their own use, and we are morally
bound to give assistance to them who have always been our
most sincere friends, and as a proof of appreciation and
gratitude for their previous and so opportune help. By
following the plan I propose we will be in a position to
discharge that duty without imposing any greater sacrifice
to any party in the operation, and at the same time secure
economic advantages for our countries.
I cannot say what is the total amount of the Latin-
American debts held in Europe, but I am sure that they
represent billions of dollars. For the sake of calculation
we will say that they amount only to one billion dollars.
Now the United States know quite well that she must ex
tend financial help to Europe and grant her credit. Let
us suppose that the credit that Europe requires amounts
to the same figure of one billion dollars. In that case I
think that there is a mutual interest for the United States
and for Latin-America that this credit should be granted
to Europe by the link of Latin-American nations.
Let me explain to you the idea. If the United States
decides to grant to Europe a credit of say one billion dol
lars, instead of sending that amount to Europe or credit
ing it here to the European nations, they will arrange with
the Latin-American countries to use that money by way
of paying some of their obligations to Europe.
In that way, you see emite well, the money that you, invest
will play a two-fold role. In the first place it goes to
Europe dollar for dollar the same as a direct loan, and helps
those nations. By the operation the Latin- American coun
tries will actually send the money to Europe by drawing
a°ainst you in favor of the European nationsthat are now
45

their creditors and to the amount of the obligations they
hold. In the second place it will allow Latin-American
countries to get rid of a large part of the burden caused
by her debts, by enabling them to have the economy ob
tained by the difference of exchange. Francs, for instance,
are quoted now in New York at no less than eleven, to the
dollar, the normal rate being 5.25 francs to the dollar.
Latin-American countries will use the same money
that you intend to send to Europe in buying the currency
of the European countries in order to pay their debts. In
that operation there will result a great economy for the
Latin-American countries without adding a cent of loss
or burden to those present European creditor nations. The
same calculations apply to the sterling- pound as well as to
any other European money, excepting Spanish currency.
Many objections may arise to this idea. Therefore, it
is necessary to say clearly that it does not involve any aim
to harm European interests. If Europe now requires money
it is in order to meet the enormous difference that the de
pression of her commerce and the expenses of the war
have caused her. This difference must be covered in any
case before the reorganization and reconstruction can begin.
Therefore, Europe may not increase in any way her wealth
by keeping Latin-American obligations. On the other hand
it is certain that if Europe requires money right now, she
must consent to receive it with its actual purchasing value
at the exchange when she gets the money. Thus
by selling Latin-American securities they will put them
selves in the real and exact position of the day and by
making a clearance of the financial situation of the world
debtor nations will occupy their real position as creditor
ones will have theirs. "V,
It is said that American markets may not support the
issue of Latin- American securities to a great extent. That
46

is certainly true, and will be made as an objection to
the idea I submit to you, but I call your attention to the
fact that if you are going to grant credit to Europe you
must in one way or the other create a market for European
securities and that is precisely which is what would have to
be done for those of South America.
Another objection is that Europeans do not want to sell
their Latin-American securities. That may be true, and
that prove that our securities are considered good and ap
preciated, but I must remind you that the debtor, generally
speaking, has the right to pay his debt before maturity, and
that privilege in most of the bonds or contracts is specific.
I believe, gentlemen, that this matter ought to be con
sidered with care by American bankers and financiers if it
happens, as I am afraid it will, that you will be compelled
very soon to grant new credit to Europe. When you de
cide to do it you will be in a position to help in a practical
way Latin-America, allowing those young nations to pay
at least a part of their debts to Europe and thus get the
benefit of the great economy by paying the debts now.
The economy or saving would be, you may be sure, invested
in new railway construction and other material improve
ments that will be beneficial to us all.
I therefore, Mr. Chairman, propose the following reso
lution :
That it be recommended to the banking interests of the
United States to study the possibility of giving financial
relief to Europe by repaying Latin- American obligations
held in Europe by means of new loans granted in the
United States to the respective Latin-American countries.

I would not like, Mr. Chairman, to finish this address
-without expressing here in public the appreciation and grati-

47

tude of the Bolivian Delegates to the American Group Com
mittee for the tireless and valuable way in which it has
worked with the Bolivian Delegation. All its members
showed a great and practical interest in my country and
adopted resolutions to help and support us in our moral
and economic desires and aims.

N0TE. — The above proposed resolution was approved
by the Committee on Resolutions and adopted by the
Conference.

48

Address by Mr. J. L. TEJADA S., Delegate of
Bolivia to the 2d Pan-American Financial
Conference, at Luncheon given by the
Federal Reserve Bank, New York
City, January 27th, 1920.
Mr. Chairman and Gentlemen:
In our intimate home-life down there in Latin-America,
whenever there is a gathering of the family and friends in
our homes, we have a custom of letting one of the children
speak, addressing to those assembled on such festive occasion
some words of welcome or felicitation. Now, we ar« here
in the United States having a most delightful reunion of the
great American family, and it seems that my distinguished
fellow delegates, following that charming custom, have se
lected me as the particular child to speak. The comparison,
seeing me so grown up and larger than the most of you, may
cause you to laugh ; but I am really the baby of this family,
because at this gathering of the family of nations I have the
honor of representing one of the smallest nations. Bolivia,
small in population and economic capacity but large in re
sources and great in possibilities.
The pleasant task assigned to me I will endeavor to dis
charge in my best way.
I am sure that all of you have followed with no little
interest the proceedings of the several sessions of the Financial
Conference just ended in Washington. I think it can truth
fully be said that this Second Conference has been the most
"important that has yet been held, hot only because human per-
49

fection asks always that new efforts shall be better directed
and give more practical results, but also after a long period of
preparation and .readiness we have reached the time when
unity of action and purpose are absolutely necessary in order
to make our plans and endeavors fruitful.
After the intense and unrestricted interchange of ideas
among the delegates and the very distinguished and able mem
bers of the American group assigned to each Delegation, to
which once more we desire to express our sincere thanks for
the hearty co-operation and intelligent and invaluable assist
ance rendered to their respective Delegations, the resolutions
of the Conference have summarized the common aspirations
of the Americas and the well thought-out plans of the differ
ent countries how to enable them to live in peace and harmony,
and to work in concord for their mutual benefit and their
general welfare. Now the labors of the Conference being
over, and the resulting resolutions adopted, we come to you,
bankers and financiers of the United States, to let you know
that the work of the Financial Conference will surely turn
to ashes in our hands unless you are ready and willing to do
your part by us. In any scheme or plan for the improvement
and development of our Latin-America countries you are abso
lutely necessary. We cannot advance in the way we should
and desire without your help. We have territory, an increas
ing population, all kinds of natural resources, and if you will
only coroperate with and aid us the production and general
result will amaze and enrich us both. Humanity and the
necessities of the world cannot cry to us for their require
ments without it being an appeal to you.
I may say that our mutual necessities and the plans in
our economic relations are as a converging glass for light.
It centers all the beams and intensifies the power of light and
50

the intensity of heat in one central point. The same way
our economic necessities must act upon your banking organi
zations. All our aims ; all our plans and programs of de
velopment, like powerful beams of confidence and trust
emerge from every part of our great continent, and through
Conferences and resolutions they focus on your banking in
stitutions with the object of inducing you to aid us financially,
industrially and commercially.
Latin-America has not come to this Conference with ex
travagant ideas and impractical propositions. I want to
emphasize the fact that there was one general point on which
we all agreed, and that was that we should and must have
better means of transportation, both on land and sea. AJI we
Latin-Americans know that cheap and rapid transportation
will have the same wonderful help in our development as it
had in yours. In all the countries to the south of yours are
already germinating and growing rapidly the seed of wealth.
All that is now needed of you is a few drops of water to
keep the tree growing until its roots reach deep enough to
maintain its vitality, and you may be sure that in a short
time the tree will be self-supporting. Then it will fructify
in a wonderful way and will pay handsomely for the care
given to its culture. Population and capital will surely fol
low, attracted by the great development and possibilities that
attend rapid and cheap transportation. Then the transforma
tion will be complete.
Previous to the war, when you were a borrowing nation,
we did not expect your financial colaboration to a great extent,
although we had always the most cheerful welcome for both
your enterprises and your men. We knew you were then en
gaged in the same task that now still confronts us, that of
¦developing your country. You were better prepared than we
.51

were when the calamity of war came and raged over the world.
The results of your combined capital, skill and organization
brought more changes and advancement to you in a few
months than you previously had in the whole history of your
national existence. You have had the chance of increasing
your wealth in such great proportions that you are now a
creditor instead of a debtor nation, and now that you are the
economic masters of the world, you should not forget the
younger brothers of the family that are still battling against
the obstacles that impede their development and progress.
We do not ask your help without showing you that we are
on a sound economic basis. During the war if we did not gain
sufficient economic power for our future necessities and de
velopment, you at least know that we have saved a considerable
amount of money, and that that has increased the gold reserves
in all the southern countries, thus making stronger their mone
tary situation and to some extent eliminating the troubles of
uncertain exchange. We are, I hope, approaching all over
America the day of money circulation on a gold basis, and
we firmly believe we have already made the foundation of
our economic future, and at the same time we have con
structed a strong bridge from the United States to our coun
tries in order that we may have your financial assistance and
the benefit of your personal efforts.
Through personal experience and repeated successes Eu
rope hfas learned before you that Latin- America is both a
.profitable and promising field. The war prevented European
countries from following their long established policy of in
vesting in and developing the southern countries, and as their
present position in the economic world will not permit them
very soon to start again putting their money in South Amer
ica, we must warn you against your timidity and indifference-
52

regarding our countries. The Europeans will soon see there
the very veins of their financial resurrection and restoration,
but as they are moneyless and powerless they will come to you
to get the money they will want to invest with us. This in
direct assistance works out, . as you may quite well under
stand, more costly and proves to be less successful ; and your
decision to make the operation by yourselves and directly
with us would surely result in increased power and a greater _
profit in your favor.
Banking transactions are in modern times the net into
which commercial prosperity is to be woven. Down there in
our countries we try to enlarge and strengthen our banking
organization in such a way as to keep it always ahead of our
development in order that our progress may not be hampered
or held back for lack of proper banking facilities.
The decision of American banks to open branches in Latin-
America has started a new era in our banking systems and in
banking operations, and the branches you have established
are proving to be powerful factors in promoting the exchange
of raw materials and manufactured goods between our coun
tries. We greeted and welcomed your branch banks when
they came to us, and the success they have attained is proof
that they are in a good field and among friends. But another
step must be taken by you. The laws that you have that
prohibit and prevent Latin-American banks from establish
ing branches here must be erased from your statute books, or
at least materially changed. In order to enable us to keep
in touch with your great markets and know and meet your
requirements, you must give us the same banking privileges
that we give you.
Your present banking system represents without doubt
the most wonderful achievement of your modern life. The
53

potential finalities to which your great nation has been destined
suggested to- your leading men to think out and to put in
operation your Federal Reserve Bank transformed later into
the Federal Reserve System, which is now at the head of your
entire banking organization or system, with its wonderful elas
ticity and sound security. Let us hope that the system that
enabled you to amaze the world, and indeed yourselves, by the
manner in which you financed the war, not only your own
country, but the allied nations as well, and with such prompt
ness, regularity and abundance, will work still better in this
happy time of peace, encouraging, stimulating and assisting
all those countries that believe that destiny has for them a
greater, grander place than they attained or occupied before
the war. It is also our wish that your banking system will
have every day a greater scope of action and a broader field of
usefulness. During the first quarter of the last century your great poli
ticians, men of trust in human destinies, joined in spirit with
us in order to guarantee political freedom to all the continent.
Times have changed since then, and politicians have been sub
stituted by bankers and financiers. Thus it is now your turn
to carry out the idea, making all the Americas economically
independent. Gentlemen. I believe I express the feelings of all the delega
tions when I say that Latin-America expects the North Amer
ican banking organization, having at its head the Bank of the
Federal Reserve, now that they have in their control practi
cally all the economic and financial power accumulated in the
world up to the present time, to show in a practical way an
interest in our countries.
On behalf of all the delegations and myself personally, I
desire to express our best wishes for your success and the con-
54

tinued prosperity of your country, and at the same time I
want to congratulate you on the grand part and service for
which destiny has selected and equipped you and your country
to render civilization and all mankind, a selection and desig
nated trust and responsibility never better placed since the
world began.

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