United States. Dept. of Commerce and Labor United States. Bureau of Foreign Commerce.

Consular reports, Issues 224-227 online

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difficulty would be experienced in bringing them under cultivation.

* The value of the Mexican dollar was estimated by the United Sutes Director of the Mint,
April 1, 1899, as 47.3 cents.

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The climate is salubrious, the soil fertile, and everything seems to
indicate that by the introduction of practical systems of irrigation
works and the intelligent application of labor, the most sanguine
expectations of the investor could be realized.

P. Merrill Griffith,
Matamoros, May 12, iSpp, Consul.


The Department has received from Mr. McCreery, secretary of
the embassy in Mexico, under date of May 2, 1899, printed copy and
translation of a circular issued to Mexican consuls by the Treasury
Department, in regard to the undue charges made by certain steam-
ship lines. The circular reads:

The President of the Republic has been pleased to order that you endeavor by
all means in your power to bring to the knowledge of shippers of merchandise to
our country the fact that the Government has learned that som6 navigation com-
panies commit the abuse of charging for lighterage or moorage, dues for loading
and unloading, as well as other charges, expenses, and fiscal dues, which are either
not collected (but are invented by the navigation companies to the detriment of
shippers or receivers) or, even when they are collected, are much less than the
amounts charged by the companies.

In consequence, the President has decided that by means of bills to be circulated
by the consulate of which you are in charge, to be conspicuously posted in the
consular offices, for the benefit of shippers and of companies that are not guilty of
the abuse referred to, you give publicity to these facts, so that navigation com-
panies may be required at least to prove the authenticity of the charges they make
on account of port dues.

The bills in question should state that the only fiscal port due payable by mer-
chandise upon its importation and which, according to law, the custom-houses should
collect from importers and not from the ships, is the due for loading and unloading,
which is applicable for the present only in the port of Veracruz, at the rate of $1
(silver) per ton of 1,000 kilograms of gross weight of merchandise, with the exception
of the goods specified in circulars 83 and 85, of July 28 and September 30, 1898,
and which only pay 50 cents per ton of their weight.

Those cargoes which are liable to the due mentioned and which are unloaded
wholly by means of lighters, or which are transferred from one ship to another,
when both vessels are anchored in the port of Veracruz and the transshipped car-
goes are destined for other ports, are only subject to one-half of the amounts above

All other port dues upon the traffic of the high seas are chargeable on the ships;
not upon their cargoes.

It is also to be observed that, according to the laws of the country, no fiscal due
is payable in gold, but in silver; and that those charges are also payable in silver
which some companies are empowered by the Government to collect in the ports —
as, for example, the so-called bar due, collected by the Tampico Harbor Improve-
ment Company, the charges for unloading merchandise on private wharves, such

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as those at Progreso, Frontera, and Laguna (Isla del Carmen), as also the expenses
of lighterage, carriage, and others, which some companies are in the habit of
charging shippers, in addition to the ordinary freight rate.

Finally, with respect to those vessels which carry merchandise, with lighterage
paid, to ports, such as Veracruz, where dues for loading and unloading are charged,
attention should be drawn to the fact that if the vessel moors alongside a wharf or
sea wall, there is nothing to be paid for lighterage and the dues for loading and
unloading are collected in their entirety, whereas, if the cargo has to be lightered,
the rates are reduced to one-half, as has before been said; but in either case, the
due for loading and unloading is a charge on importers, and not on the vessels.


I recently had the following intei^iew relative to railroad construc-
tion in northern Mexico with Mr. John P. Ramsey, general manager
of the Rio Grande, Sierra Madre, and Pacific Railroad, which runs
southwest from Ciudad Juarez for a distance of 150 miles. The ques-
tions and answers are given in the order in which they occurred :

What are the first steps necessary to be taken in railway construction in the Re-
public of Mexico?

To secure a concession (charter).

How are concessions obtained, and from what department of the Mexican

Ordinarily, they are obtained by individuals, with the right reserved to transfer
them to such a company or companies as may afterwards be organized. They are
secured through the Department of Public Works and Communications (Commu-
nicationes y Obras Publicos).

How is a company organized to build a railroad in Mexico?

The Federal Government of Mexico maintains a monopoly upon all telegraph,
railroad, and postal lines operated within the Republic. The right, however, to
operate for a specified time either one or all of these enterprises may be, and often
is, conferred upon corporations and individuals. To facilitate the operations and
to protect the rights of both the operator and the Government, contracts are entered
upon, in the form of a concession, which may or may not provide for governmental
assistance in the construction work. Individuals may operate in their own names.
Corporations organized in the usual manner under the laws of any country or state
may operate; but after organization and incorporation in the original country or
state, properly authorized officers must present to the Secretary of Communications
and Public Works copies of the organization papers, the articles of incorporation,
properly translated and authenticated by the authorities in the place where organiza-
tion occurred and by the nearest Mexican consul. After the papers have been pre-
sented, approved, and filed, the corporation is in a position to proceed with the
construction and operation. Where governmental assistance is given in the way of
subsidies, the concession is usually granted for a term of ninety-nine years, at the ex-
piration of which time the property reverts to the Government. The Government, in
this case, assumes certain obligations set forth in the concession. The Government
also maintains representation on the board of directors, and an inspector at all
times on the work^ not only during construction, but after operations have com-
menced. The Government may permit a corporation to maintain general offices at

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any convenient point; but if the location of those offices is at some place other than
the City of Mexico, the corporation is under the necessity of maintaining a represent-
ative in that city.

What conditions govern when subsidies are granted?

All plans must be made according to regulations is^ed by the Department of
Communications and Public Works and under the supervision of the Government
inspector, who approves and forwards the plans to the department. The plans
must be made in triplicate. After approval, one copy is placed on file in the de-
partment, one is sent to the inspector, and one is returned to the company, with
the authority to proceed with the work. Subsidies vary according to the character
of the country through which the proposed line is to be built, and for other reasons.
Subsidies range from j7,ooo to f 25,000 (Mexican currency) per kilometer (0.621376
mile), or even higher. The difficulties to be encountered in construction have a great
deal to do with the amount of subsidy. Subsidies may be paid in Government
bonds, in lands, or in both land and bonds.

What is the cost of construction per mile in open countries and in mountains?

The cost of construction of a standard-gauge road will vary from f 10,000 in
gold per mile where the work is light and few difficulties are to be encountered to
j5o,ooo in gold per mile, or even more, in the mountain districts.

What system is followed in building across a barren, desert land (first 50 miles
of your road, for instance)?

The work is performed most economically with teams and scrapers. The men
live in camps conveniently located. Food and water are hauled in wagons from
the nearest source of supply. Where sand is encountered, the transportation of
supplies becomes a most serious item of expense. To illustrate: During the con-
struction of the Rio Grande, Sierra Madre, and Pacific road, one contractor used
50 per cent of his teams to haul supplies. Water costs 50 cents in gold per barrel
in camp. After the track was laid, trains were immediately put to work covering
the sand with clay and with a heavy material in the form of disintegrated lime,
called '*calichi," which is to be found in large quantities along the line of road.

What kind of labor is employed in construction? What wages are paid? Is
work done by contract, at so much per mile for grading, etc. ?

The work of construction is almost invariably done by contract. The contractor
is paid on the basis of the cubic meter (35.316 cubic feet). The labor employed is
largely of the native, so-called '* peon," class, although there is always to be found a
large number of white and black Americans along the line of a new road. The lowest
price paid for labor is $1 per day, Mexican money, in the State of Chihuahua.

What duties are paid on material for construction, and where is it procured?

There are no duties on rails, ties, fastening, bridge timbers, etc. The rails and
fastening for our road were furnished from Pittsburg, and the ties and timbers came
from eastern Texas.

How many men are necessary to keep a track in good condition after the road
has commenced operations?

One man for every 2 miles will maintain the track in good condition for light
traffic and two trains per day.

How many miles of road can be constructed per month in northern Mexico?

The Rio Grande, Sierra Madre, and Pacific began grading August 15, 1896, and
156 miles of track were completed June 15, 1897, ten months later, making an aver-
age of 15.6 miles per month. On several occasions, 3^ miles of track were put
down in one day, the necessary material having been transported 100 miles from
the base of supplies to the front.

What kind of fuel is used to run the engines, where obtained, and at what cost?

Bituminous coal and cord wood. Coal costs from ^.25 to $6 per ton, and wood

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is as low as J2.75 per cord. Coal is shipped here from a distance of 500 or 1,000
miles, and wood is obtained in the vicinity of the line. The wood is principallj
"grease-wood'* roots, dug from the sand hills by the Mexicans and transported to
market on the backs of burros.

What amount of rolling stock is necessary to equip a new road in Mexico?

The equipment depends entirely upon the character and amount of business.
My road, running one passenger train each way per day, has a passenger equip-
ment of 8 cars, providing first, second, and third class coaches in accordance with
Government regulations; a freight equipment of 150 box cars, 50 coal and flat cars,
and 16 water, boarding, and miscellaneous cars, and a motive power of 6 locomo-

How are rights of way secured ?

By purchase, gift, and condemnation.

Are freight and passenger rates subject to Government control and jurisdiction?

Yes. No rates may be changed without authority and publication for fifteen
days if in the nature of a decrease and thirty days if in the nature of an increase.

How long does a concession last?

Concessions are for various periods, but when providing for Government assist-
ance in the way of subsidies, the term is ordinarily fixed at ninety-nine years. At
the expiration of that time the Government assumes control, the title to all the
property, with the exception of the rolling stock, passing into the hands of the Gov-

Charles W. Kindrick,
CiUDAD Juarez, May 77, i8gg. Consul.


Consul Plumacher transmits from Maracaibo, under date of April
29, 1899, translation of a recent concession for the construction of a
railroad between Puerto Cabello and Yaritagua, as follows :

The Minister of Public Works of the United States of Venezuela, authorized by
the President of the Republic as the party of the first part, and Luis Mufloz Febar,
civil engineer, with previous approval of the cabinet as the party of the second part,
have agreed upon the following contract:

Article i. The Government of Venezuela grants to Luis Mufioz Febar, his as-
sociates and successors, the right to construct a railroad from Puerto Cabello to
the city of Yaritagua, in the State of Lara, to be divided into two sections, the first
from Puerto Cabello to San Felipe and the second from San Felipe to Yaritagua.

Art. 2. The duration of this contract shall be ninety-nine years, counting from
the day that the work is concluded, and the Government of Venezuela binds itself
not to grant a similar contract to any other person or company within forty years
to build a railroad between the above-mentioned places. At the end of the ninety-
nine years, the railroad, with all its appurtenances, warehouses, stores, and ofilces.
shall be turned over to the National Government in good order and become na-
tional property.

Art. 3. Luis Mufloz Febar, his associates or successors, bind themselves to organ-
ize a limited joint-stock company for the construction of the railroad, and are hereby
authorized to transfer this contract, if convenient to their interest, subject to pre-
vious approval of the National Government.

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Art. 4. The term of ten months is fixed for the beginning of the work of con-
struction, counting from the date on. which Congress approves this contract, and
two years from date of commencement of works to conclude the first section from
Puerto Cabello to San Felipe and deliver same for public service. Two years are
also granted to complete the second section after the first one is finished.

Art. 5. In case of delay due to force majeure, an additional period equal to that
lost shall be granted.

Art. 6. The first section can be started from El Palito, by previous arrangement
with the company of the Puerto Cabello and Valencia Railroad for services between
El Palito and Puerto Cabello, until said road is constructed by the company as per
this contract.

Art. 7. The railway shall be of one track with a width of 1.7 meters (3.51 feet)
between rails, and its declivity shall not exceed 2% per cent; the minimum radius
of its curves shall be 65 meters (213 feet), and the work shall be all done in accord-
ance with scientific principles, and only good materials shall be used.

Art. 8, The Government shall allow the introduction free of import duties of
all the materials, machinery, tools, and other articles described in the inclosed list,
necessary for the construction, preservation, and management of the railroad, all
subject to the laws and decrees issued by the Government, with the exception of
articles produced in the country. The enterprise shall not be subject to national
taxes during the period of this concession, excepting the stamp fee, and is free
from the public-register tax.

Art. 9. The company is authorized to open to public use parts of the road
completely constructed, and may charge a rate in proportion to the distance
traversed. As long as the National Government does not reduce the tariff as per
article 9 of the law of May 31, 1897, on construction of railroads, the company may
charge for freight and fares as follows:

For a first-class passage of one person with 25 kilograms (5s pounds) of baggage,
25 centimes of a bolivar (4.8 cents) per kilometer (0.62137 mile); for a second-class
passage of one person with 25 kilograms of baggage, 15 centimes of a bolivar (2.8
cents) per kilometer.

Freights, — For every 1,000 kilograms (2,204.6 pounds) of merchandise, effects, or
produce, 50 centimes of a bolivar (9.6 cents) per kilometer; less weight shall be taxed
in proportion, but small parcels not exceeding 20 kilograms (44 pounds) in weight
sent in charge of the company shall pay double freight.

The company shall have the right to charge for freight per weight or measure,
taking i cubic meter (35.316 cubic feet) as the equivalent of 1,000 kilograms. Sugar,
spirits, woods, bananas, empty bags, salt, cocoa, coals, vegetables, corn, starch,
cement, and onions shall pay one-half of the regular rate established. Bags and
rexurned boxes shall be carried gratis.

Art. 10. If the second section shall not be constructed in the stipulated time,
the grant to said section shall be annulled; but all other rights and privileges
granted to the first section, if this is well constructed, shall remain in force.

Art. II. The Government shall allow the contractor, his associates or suc-
cessors, to cut from the national forests the timbers necessary for the construction
and preservation of the road, without charge.

Art. 12. Private lands which may be necessary for the construction of ware-
houses and offices of the road from Puerto Cabello to Yaritagua shall be taken by
the Government for public use, in accordance with the law, and the contractors,
their associates or successors, shall pay their value.

Art. 13. The Government grants to the Puerto Cabello and Yaritagua Railroad
Company the right of property in the public lands required for the width of the line,
with a strip of land of 15 meters (49.21 feet) at each side of the road, and for

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its stations, offices, and stores. It further grants areas of 25 square kilometers
(9.65 square miles) in the public lands of thenlistricts through which the railroad
passes, request for the same to be made to the Department of Agriculture, In-
dustry, and Commerce, with a map of the land needed; but further areas shall not
be granted until it is proved that the first have been distributed among colonists
to be used for agricultural, breeding, or other industries, according to the law on
colonization, and with previous consent of the Government.

Art. 14. The contractor or the person representing him is bound to deposit at
the bank the sum of 50,000 bolivars ($9,650) in gold or its equivalent in public-debt
bonds of Venezuela within six months after the approval of this contract by the
National Congress and in conformity with article 6 of the law in force on railroad
construction, and shall also in due time deposit the amount to the credit of public
instruction, as prescribed in the above-mentioned article, as a guaranty that the
work of construction shall be performed.

Art. 15. The contractor, his associates or successors, bind themselves to convey
all mails sent from the national post-offices gratis; and troops, public employees
on commission, and mechanics of the Government for one-half the regular fare.

Art. 16. The company shall have the right to construct branches at either sides
of the main line, for connecting other towns or places, if the branches are not longer
than 25 kilometers (15.55 miles), after notification to the Department of Public
Works and with the permission of the Government, subject to the approval of

Art. 17. The contractor, his associates or successors, renounce the subsidy per
kilometer by which the Government of the Republic may favor the construction of
railroads, in conformity with article 5 of the law; but it will have the benefit
of all the other privileges and rights granted by said law for the period of this

Art. 18. All doubts and controversies which may arise between the contracting
parties, their heirs or assignees, in the interpretation of this contract, shall be de-
cided by the courts of the Republic according to law, and in no case must they be
made a pretext for international claims.

Made two of one sole tenor and effect in Caracas on the 12th day of April, 1899.

A. Smith.
Luis MuRoz Febar.

list of articles admitted free of duty for the railroad from PUERTO

Portable gauges, trolley and hand cars, hatchets, knives, picks, crowbars, spades
and "chompas;" rails, with their corresponding bolts and plates; galvanized zinc
or grooved iron, bolts and nails; Portland cement, dynamite, powder, caps, bits
for boring, engineering instruments and articles for office and drawing purposes,
safes, tar and paints, ropes, iron and wooden pulleys, iron hammers, saws, pumps,
locomotives, cars and wagons, blacksmith tools, coals, and engine grease.

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The railway system of Uruguay is well planned for the service
of the State, and as the State has been and is yet the guarantor of
interest — at one time at the rate of 5 per cent, but now 3^ percent —
on a value of ;;^5,ooo (5)124,432) per kilometer (0.621376 mile) on the
bonds outstanding, there is no reason why the public convenience
should not be considered in every way.


Herewith is given an official statement as to the length of the
several lines and the amount of capital invested in securities issued :

Name of line.



Central Uruguay Railway Company, Limited..

Central Northern Extension

Central Northeastern Company

Central Eastern Extension

Great Eastern of Uruguay Company, Limited-
Midland of Uruguay Company, Limited

Northwestern of Uruguay Company, Limited..

Northern of Uruguay Company, Limited

Branch to San Eugenio

Western Railway Company

Northern Railway

Interior (not yet built)




























l«3, 760,421

93, 971, "79

The amount paid in 1897 by the Government of Uruguay, on its
guaranty of interest on bonds, was over $1,000,000 (Uruguay stand-
ard being J1.0352 United States) and a regular percentage of all
custom-house receipts is set aside for the fund thus used. The
official returns do not show that a single line has yet proven self-
supporting above the guaranty of interest by the Government, nor
is the outlook very promising.


All the fuel for the motive power is imported from Wales, and
the machinery of all kinds, rails, chairs, and general outfittings come
from England. A good percentage of capital will never go back to
England, for the simple reason that the earning capacity of most of the
lines can, under no present conceivable circumstances, be brought to
the point desirable for all such enterprises. The interior of the
country is largely devoted to cattle and sheep farming, and the season
for handling these is not continuous. The cultivation of grain, while

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it is showing a slow increase and has added a considerable item to
the receipts for freight, is not of such promise as to give the man-
agement much encouragement.


The construction of the lines can be classed from excellent to
first class, and the best of English methods — somewhat conserva-
tive, yet safe — have been employed. The bridges and culverts can
hardly be improved upon for lines with such traffic. The grades are
generally easy and, with but few exceptions, are kept to a legitimate
normal. The rolling stock is good, but it does not compare in any
way with the equipment on similar lines in the United States. On
none of the lines at present is a through passenger train operated ;
the trains are all mixed — that is to say, freight and passenger in the
same train — the old accommodation train of the Western roads.

The management is to be commended for the practical results
obtained. The rates maintained would be deemed very high in

Online LibraryUnited States. Dept. of Commerce and Labor United States. Bureau of Foreign CommerceConsular reports, Issues 224-227 → online text (page 84 of 92)