81:
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world would have been able to build a syndicate to lend to Mexico without having a selection of ICBM members. The ICBM agreement stated that
Mexican debt bondholders would agree to adhere to the ICBM agreements with the Mexican government. At its peak in 1925, the ICBM represented 97% of Mexico’s debt holders.
418:. Mexico paid about $ 15 million in 1922 for the first annual deposit of the debt agreement. The ICBM lent $ 350,000, which Mexico lacked to complete the first payment and paid back a year later. Mexico also sent the ICBM $ 700,000 at the beginning of 1923, as part of the second payment, due in 1924.
372:
The preamble of the treaty stated that the ICBM recognized the "difficulties with which Mexico has had to contend and the limitations upon her capacity for the immediate payment." The country desired to co-operate "with the
Mexican government in the solution of its problems and in the upbuilding of
255:
The United States had initiated a ban on loans to Mexico in 1921 and had put the repudiation of
Article 27 as its condition for lifting the ban. At the time, the United States had a virtual monopoly on potential lending capital. Lamont and the ICBM were only marginally concerned with Article 27 and
225:
On
February 23, 1919, bankers and representatives of foreign bondholders created the ICBM. The ICBM included the most prominent and influential commercial and investment banks of the time. It was designed to be a powerful mediator between bondholders and the Mexican government. No major bank in the
337:
Lamont reminded de la Huerta that no loan was possible until the United States recognized the Obregón government. Realizing that recognition from the United States would not be forthcoming without a debt agreement, Obregón reluctantly signed the treaty on August 7, 1922. It was a surprise that he
380:
The money was to come from 10% of the gross revenue of
Mexican railroads and an oil export tax. If that was too little, the difference was to be made up of bonds, which would not bear interest until 1928 and then would bear 3% after 1928, with a maturity date of 1943. Mexico agreed to make forty
429:
That was done in the Pani-Lamont
Amendment to the De la Huerta–Lamont Treaty, which reduced Mexico’s debt while the country kept its credit status. Mexico again defaulted on the agreement soon after the amendment was signed. Mexico made small payments on its debt from 1923 to 1927. Efforts to
425:
in 1923. The cost of putting down the rebellion, as well as the inability of Mexico to secure new loans, caused Mexico to go into default again. On June 30, 1924, Obregón ordered the suspension of further payment, which made it necessary for another adjustment of the foreign
Mexican debt.
303:
Negotiations resumed in
January 1922 in New York City with Eduardo Iturbide, managing director of the Bank of Commerce and Industry of Mexico City, representing de la Huerta and the Mexican government. They failed to come to an agreement, and Iturbide was recalled on January 18, 1922.
205:
banks, which were concerned with investments in Mexico on the condition that control of the committee's policy remain in
American hands. Initially, 50% of the seats on the committee were for American banks, with 25% each for English and French banks. Banking interests from
403:
The treaty had mixed effects. It was considered a brilliant success by some. The treaty represented a short term solution to others because of the heavy burden it imposed on government finances. De la Huerta's supporters tried to claim the treaty was a victory for Mexico.
333:
The tentative accord awaited ratification from Obregón. Initially, Obregón refused to ratify the agreement and stated that he was skeptical of the "good faith and sincerity" of the committee. Instead, he told de la Huerta to immediately open negotiations for a new loan.
805:
376:
Mexico agreed to set aside funds that would allow it to begin making full payments on its bonds in 1928. Mexico said it would commit $ 15 million to the fund in 1923 and to increase the amount that it was putting in the fund by $ 2.5 million each year.
296:
There were a number of issues in the negotiations. The
Mexican government insisted for any debt settlement to include a new loan, and Obregón argued that without new funds, Mexico would probably be unable to live up to any agreement.
368:
The treaty dealt with all the external Mexican government debts, direct or guaranteed, the railroad debt, and some internal government debts largely held outside Mexico. The treaty consolidated Mexico's debts.
391:
The amount of direct debt held was 22.9% United States, 19.6% United Kingdom, and 32.4% France. The railroad debt was also mostly in foreign hands: 12.5% United States, 35.9% United Kingdom, and 36.4% France.
326:
A new round of talks began on June 2, and de la Huerta and Lamont signed the self-titled De la Huerta–Lamont Treaty at 6pm on June 16 at the offices of the Mexican Finance Commission at 120 Broadway,
259:
The United States wanted all American claims against Mexico to be settled simultaneously. The ICBM, on the other hand, was willing to negotiate a separate settlement of Mexico's foreign debt.
245:, which could be used to pay down the debt. The State Department wanted the bankers to get their money and for assets not to be seized, but the bankers tried to keep the two issues separate.
354:
773:
307:
On March 3, 1922, the US State Department sent a message to the banking community, which effectively stopped any loans originating from the United States from non-members of the ICBM.
252:
ruled that Article 27 was not retroactive for oil reserves if "positive acts" had been undertaken to exploit them. Therefore, only untouched lands were covered under Article 27.
286:, stating that negotiations could not begin until Mexico had declared that Article 27 was not retroactive. The Mexican government ignored that but was not pressed by Lamont.
338:
signed the treaty before he went on vacation because he had said that he would study it while on vacation. De la Huerta convinced him to quickly sign the treaty.
466:
229:
There was a significant amount of pressure from both the United States and Europe for Mexico to repay its debts and to deal with issues around Article 27 of the
275:
The Mexican government initially invited Lamont to discuss its finances in 1921. Lamont obtained approval to begin negotiations with the administration of
289:
Lamont negotiated in Mexico from October 5 to October 21, 1921. The initial negotiations were unsuccessful. Lamont did not accept a plan that required a
230:
645:
248:
Article 27 of the Political Constitution of the United Mexican States implied that US citizens' oil holdings in Mexico could be seized. In 1921, the
748:
518:
780:
986:
1026:
1031:
1036:
411:
between Mexico and the United States in 1923, which led to recognition of Obregón's government by the United States in August 1923.
139:
922:
895:
868:
851:
711:
249:
193:
to organize an international committee of bankers. In February 1919, the State Department granted approval to bring together
256:
its effect on American oil companies. The primary concern of the bankers was to protect the holders of Mexican securities.
1021:
1001:
473:
300:
The ICBM said that no new loan would be granted without a debt agreement and official American recognition of Mexico.
932:
905:
878:
721:
774:"Independent Internationalism And Nationalistic Pragmatism: The United States and México Relations During the 1920s"
388:
The total debt covered by the agreement pre-interest was $ 507,457,000. The interest owed was around $ 280,000,000.
596:
Smith, Robert Freeman (1963). "The Formation and Development of the International Bankers Committee on Mexico".
241:
There was a tension between the repayment of debt and the Mexican government’s potential control over Mexican
652:
373:
its credit." In addition, the ICBM recommended “bondholders make substantial adjustments of their rights."
365:
on Mexican bonds was to start January 2, 1923, and back interest was going to be paid by January 1, 1928.
1041:
1016:
155:
824:
737:
1006:
511:
434:
553:
Kane, N. Stephen (1973). "Bankers and Diplomats: The Diplomacy of the Dollar in Mexico, 1921-1924".
438:
1011:
467:"El Convenio de la Huerta-Lamont de 1922: La Diplomacia Financiera Como Arma de la Revolucion"
381:
equal payments from 1928, which would pay off all the bonds by 1968. Also, Mexico agreed to
345:
ratified the treaty in September, and the agreement became effective on September 29, 1922.
8:
279:
276:
143:
68:
60:
512:"Exorcising Asian Debt: Lessons From Latin American Rollovers, Workouts, and Writedowns"
965:
681:
646:"Political Instability and Credible Commitments: The Case of Post-Revolutionary Mexico"
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613:
578:
570:
342:
132:
97:
928:
901:
874:
717:
625:
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The ICBM got nearly everything that it wanted in the treaty. Payments on the current
293:
of the debt. De la Huerta felt that Lamont's terms were too onerous and humiliating.
242:
171:
127:
and the International Committee of Bankers on Mexico (ICBM) on Mexico's substantial
957:
921:
Wilkie, James Wallace; Meyer, Michael C.; Edna Monzón de Wilkie (January 1, 1976).
605:
562:
385:
its railroads, but the government would still be in charge of the railroads' debt.
190:
151:
110:
64:
408:
924:
Contemporary Mexico: Papers of the IV International Congress of Mexican History
672:
Machado, Manuel A. (1972). "The United States and the de la Huerta Rebellion".
609:
995:
415:
327:
198:
194:
825:"Obregon Signs Mexican Debt Agreement Negotiated by Lamont and de la Huerta"
442:
330:. The signatures were attested by I. H. Pachin, the secretary of the ICBM.
290:
353:
282:
from the State Department in June 1921. Lamont sent a letter with a quasi-
211:
207:
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36:
Offices of the Mexican Finance Commission at 120 Broadway, New York, NY
318:
267:
961:
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382:
283:
219:
566:
362:
177:
147:
894:
Coerver, Don M.; Pasztor, Suzanne B.; Buffington, Robert (2004).
395:
There was no timeline set for privatizing the Mexican railroads.
215:
186:
159:
158:
and was the basis of the next several decades of Mexican foreign
154:. It was considered the initial step in the normalization of the
920:
202:
124:
120:
85:
80:
644:
Musacchio, Aldo; Gómez-Galvarriato, Aurora; Parral, Rodrigo.
128:
948:
Feis, Herbert (1929). "Financial Reconstruction in Mexico".
643:
897:
Mexico: An Encyclopedia of Contemporary Culture and History
310:
In late May, de la Huerta was sent to the United States.
893:
738:"Why Lamont Failed to Negotiate Debt With Dela Huerta"
713:
Triumphs and Tragedy: A History of the Mexican People
430:
resolve the default continued throughout the 1930s.
231:
Political Constitution of the United Mexican States
993:
189:, in 1918, Lamont solicited the approval of the
927:. University of California Press. p. 698.
414:The repayment of the debt took money away from
89:International Committee of Bankers on Mexico
639:
637:
635:
987:The de la Huerta-Lamont Treaty in Spanish
866:
772:Ríos, Rodolfo Villarreal (Autumn 2008).
767:
765:
763:
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509:
437:eventually occurred in 1938. All of the
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140:Secretariat of Finance and Public Credit
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16:1922 treaty between Mexico and the ICBM
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1027:Treaties entered into force in 1922
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856:. Brill Archive. pp. 120–122.
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322:Adolfo de la Huerta, July 18, 1922
14:
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870:The Mexican Revolution, 1910-1940
407:The treaty paved the way for the
138:The treaty was negotiated by the
754:from the original on 2022-07-06.
510:Aggarwal, Vinod K. (July 1998).
185:Claiming pressure from European
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804:. June 17, 1922. Archived from
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598:The Journal of Economic History
524:from the original on 2022-07-04
262:
1032:Mexico–United States relations
853:Oil and the Mexican Revolution
730:
174:on its bonds since late 1913.
1:
1037:Mexico–United States treaties
867:Gonzales, Michael J. (2002).
448:
165:
710:Ruiz, Ramón Eduardo (1992).
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116:Acuerdos De la Huerta-Lamont
7:
555:The Business History Review
156:foreign relations of Mexico
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1022:Treaties concluded in 1922
1002:Economic history of Mexico
107:De la Huerta–Lamont Treaty
20:De la Huerta-Lamont Treaty
900:. ABC-CLIO. p. 136.
610:10.1017/S0022050700109246
435:Mexican oil expropriation
181:Thomas W. Lamont ca. 1922
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74:
56:
48:
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218:were later added to the
850:Rippy, Merrill (1972).
445:between 1929 and 1937.
123:signed in 1922 between
465:Castro, Pedro (1997).
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798:"Agreement On Debts"
747:. October 25, 1921.
357:Mexican debt in 1922
237:Different priorities
439:Mexican rail system
170:Mexico had been in
144:Adolfo de la Huerta
61:Adolfo de la Huerta
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1042:Eponymous treaties
1017:Treaties of Mexico
832:The New York Times
745:The New York Times
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343:Congress of Mexico
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271:President Obregón.
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133:Mexican Revolution
98:Congress of Mexico
44:September 22, 1922
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834:. August 8, 1922.
802:Los Angeles Times
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243:natural resources
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449:References
166:Background
146:, and the
131:after the
49:Expiration
626:153570334
583:153730386
423:rebellion
399:Aftermath
383:privatize
284:ultimatum
277:President
220:committee
160:financing
94:Ratifiers
41:Effective
970:20028729
749:Archived
686:30238152
519:Archived
363:interest
195:American
148:chairman
119:) was a
33:Location
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216:Belgium
199:British
187:bankers
172:default
111:Spanish
75:Parties
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86:Mexico
25:Signed
966:JSTOR
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349:Terms
129:debts
929:ISBN
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441:was
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341:The
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