INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENTdocuments.worldbank.org/curated/en/... · international bank for reconstruction and development the external debt of cuba ...

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This report is ~not to be published nor tnay it be quoted as representing the Bank's views.

No. E 164

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

THE EXTERNAL DEBT OF CUBA

Economic Department Prepared by: James J. Lynch Reviewed by: Carel de Beaufort

June 15, 1951

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Table of Cont~nts

Page I. Current External Debt

a) Dollar Debt Outstanding b) Debt Service Payments

II. History of EOrrO\'ling

a) Publicly-Issued Dollar Jonda b) Public Works Loans c) SUgar Stabili~ation Loan

III. The Default on the P~blic Debt

IV. Settlement of the External Debt

Table A-I! External Debt of Cuba A-2:

A-3: A-4:

Estimated Interest and Amortization Payments on the External Debt of Cuba

Cuba - External Debt Cuban Exterl"'..al 4is of 1937-1977

1

1 1

1

2 2 3

3

4

THE EXTF::llr).L DEBT OF CUBA

I. Current External Debt

a) Dollar Debt Outstanding The estimated outstanding dollar debt of Cuba amou"'1ted to $72.5 million

at the end of 1950. This consisted of t\1TO dollar bond issues, (1) the 4~s of 1941-1955 amounting to $5 million. and (2) the 4ts of 1937-1977 amounting to ~67.5 million. Nost of the dollar debts are held internally. The latest available in­formation (September 30, 1950) from Cuba on this ownership is sho\-In be10\,1.

O\\Illed by;; Foreign institutions and individuals Cuban: Commercial banks

Retirement funds Postal Savings System Insurance Companies Genera,l Public

b) Debt Service Parments

Total Dollar Debt

Amount (in millions of $)

8 15

3 3

13 1Q.

72

The total service payments on the dollar debt will rise from a level of $6.1 million in 1951 to a peak of $6.6 million in 1955. In that year the last block of the 4-?3s of 1941-1955. estimated at $1.4 million, "Till be paid. off, leaving the Cuban 4~s of 1937-1977 as the only remaining dollar debt of Cuba. Total service payments decline to $5 million in 1956 and then gradually move dO'dm-ard to an estimated $3 million by 1975. For further details on the interest and amortization payments see Table A-2.

II. History: of BorroHing

Cubals funded public debt issued between 1903 and 1937. in the following categories, amounted to approximately $257 million:

a) External dollar bonds, amounting to a total of $120.5 million, issued in the brew York bond market betvTeen 1904 and 1927.

b) The Public ;vorks bonded debt of $100 million contracted in 1927 and thereafter, but never publicly issued.

c) The Sugar stabilization bonds of ;j37 million issued mainly to Cuban sugar producers in 1930 in connection "lith the Sugar stabilization Plun •

. ,. ./ ...

- 2 -

A description of these three categories follows.

a) PuR1ic1y-Issued Dollar Bonds

ReJ2ublic of Cuba CouJ2on Date c+'· Issuing Principal Amou..."!t J. •

Issue Haturity Price ori~ine,ll;v issued 1) 5% 1904 1944 97 r~ 35,000,000 2) %% Sept. 1909 1949 96 5.500,000

Feb. 1910 98 5,500,000 Feb. 1911 98-3/4 5,500,000

3) ,1- 1914 1949 98-1/2 10,000,000 IV

4) 5.1.4. 1923 1953 99-1/4 50,000,000 2/';)

5) S~% 1927 1937(Serial) 5.2S% for all 9.000,000 maturities. -TOTAL ..•• $120,SOO,000

The above loans ""ere issued for the follotting purposes:

1) To meet obligations of the Army arising from the War of Liberation. 2) To retire the Republic of Cuba 6% internal bonds and to defer the

cost of sewering and paving the city of Havana. etc. 3) To serve the general purpose of the Government. 4) To liquidate the 610 internal loan due in 1923 ($5 million); to pay

for salaries, 'tvages, etc. due before July 1. 1922 ($7 million); to pay for maturities of Departm~mt of Public ivorks for past due indebtedness, etc. ($12 million).

5) To fund internal floating debt.

For additional details see Appendix III.

b) Public i1ork§ LOftns The second group, the Public :torks loans, was issued in accordance

\.[i th the Public i'lorks La1:1 of July 15, 1925, "Thich provided for an extensive pro­gram of internal improvements, including the Central HigbJay traversin;3 the island anc\ connecting the various Provinces with Havana. also included -,rere \'later l'rorks, bridges, sen'rer and drainage systems, public schools and. public buildings. Listed belo\-r are the Public "iV-orks loans issued to carry out this program.

Republic of Cuba - Public ;-lorks Date of: ISSUing Principal

Issue ~Jja turi t;y Price .'"I.mount 1) 5~ Serial Certificates 1928 1931-32 99 .... ')/4 0 10,000,000 2) S~ " 11 1929 1933 100 10,000,000 3) ~ Treasury Notes 1928-31 1935-40 100 20,000,000 4) S~~ Bonds 1930 1945 98 40,000,000 5) 51~ Deferred Payment \jork

Certificates 1931 1933-37 100 20,000,000

TOTAL ... $100,000,000

Most of these loans t'lere issued privately under a revolving credit arrangement wi th the Chase Hational Bank of l!e\<T York and to contractors. For additio:nal details see Appendix III.

. ... / ...

- 3 -

c) §ugar Stabilization Loan . . The third category, the Sugar Stabilization Loan, was author1zed 1n

the amount of $42 million in 1930 in connection "li th the Chadbourne Sugar Stabilization Plan, the object of 1I'1hich 1I'1aS to make possible the disi;osal of ,.., large stocks of sugar and to stabilize prices at a remunerative level. Only 'll)7 million of the loan 1I'1aS actually issued. The bonds, payable in U.S. dol;'ars, Here not offered "publicly but Vlere issued only to sugar producers in Cuba in ex­change for about i.5 million tons of raw sugar of the 1929-30 or 1930-31 crop. Under the terms of the Sugar Stabilization Loan the sugar so acquired '-.ras pledged as seeuri ty for the loan and VIas to be sold in equal annual amounts during the period from 1931-35. Proceeds from the sale of the sugar up to $4.07 pel.' bag of. 325 pounds t'lere to be used to purchase bonds at par; the excess over C4.07 was to be used first to pay expenses of the fiscal agent and trustees, and the balance, if any, vias to be u.sed to redeem the bonds, The loan 1tlas also secured (to the extent needed to cover interest) by a preferential lien on the proceeds of a special tax of ll¢ per 325-pound bag of raw sugar produced from 1931 to 1935, inclusive, and 50¢ per bag from 1936 to 1940. inclusive.

:Because proceeds from the sale of the pledged sugar 1tlere applied to the redemption of bonds and the price of sugar fluctuated predictably. it became impossible to determine beforehand the amount of bonds to be redeemed at any period. By December 31. 1933 about $7.9 million of the bonds had been redeemed and by February 28, 1938 the total amount outstanding had been reduced to $3.5 million. The balance vIas paid when it 'became due in 1940.

III. The DefauJt on the Public Debt

Eet'-lean 1934 and 1938 certain difftcu1 ties arose regarding service payments on the debts other than the Sugar Stabili2ation Loan.

a) On the publicly-issued dollar bonds, interest .... ,as paid regularly from the time of issue to maturity but under a La\'l of April 10, 1934 sinking fund pay­ments on these issues vlere suspended until the national revenue, including PubJ.ic -'{orl-:s Funds receipts, should reach an annual goal of :p60 million. Sinking fund remi t tan.ce s 1I'/ere, h01tleV er, re surned in the fi scal year 1935-36. Because of purchases of these securities for their respective sinking funds at less than par, the retirement of these dollar issues, excelJt the Seri8.1 .5j-» of 1927-19),7, ,..,as maintained at the originally required sin.1ting fund rate. In the case of the Serial 5';Is, the July 1, 1934, 1935 and 1936 Serial payments of $900.000 i'rere made one year late. Interest on the matured series. in default on principal, was continued and the final series due on July 1, 1937. vras paid on July 1. 1938,

b) Because of the unfavorable market for foreign bonds in the capital market in 1930 and thereafter. the banks and contractors holding the Public iiorks debt ,,,ere unable to reimburse themselves 'by selling long-term Cu.ban government bonds. After the fall of the Nachado Government in August 193'3. the legality of these Public Ivorks obligations vms attacked by the neH governiIlent and, pending final adjudication of the question, interest payments and. certain sinking fund paYrJents, "tlhich \-Tere to hEl.ve begun on December 31, 1935, lolere suspended. Final settleI'lent was met by the issuing of the present bonds no1l'! outstanding and described belov!.

- 4-

IV. Settlement of the Zxternal Debt

After lengthy negotiations by the Cuban Government "r! th the Foreign Bond­holders' Protective Council, various banking interests, contractors and a com­mittee of bondholders of Cuba, an agreement for settlement of the Public \vorks Debt, (excepting Treasury notes held by contractors and interest thereon), ':THS

signed on December 22, 1937, and ratified by the Cuban Coneress on February 14, 1038. The pro'Posed 'Program covered the follo\·ril"'.g issues, all of l:Thich "Jere eX'"

.- - - lr-f ( changed for ne1" bonds bearing ~/j interest and maturing in 1977. See Appendix III - Page 3 and Appendix IV for additional details).

.51% Public '\vorks Serial Certificates Interest arrears

.5!~ Public Works Gold Bonds Interest arrears

.5~J% Deferred Payment 11orl-:

Debt Plan of 1938

Date of~ IssuEi Haturit;y

1929 June 30, 1933

1930 194.5

Certificates 1931 Mar.4,. 1933-37 Interest arrears

Due to rail ,vays Total • . . . , To be reserved

Total .. .. ., • .. .. .. • .. .. .. • .. .. ...... *... • • • .. If' .,. #I • .. • .. " .. "". .. .... \0- .. .. •

Outstanding Amount in

1918

867.000 190,740

40,000,000 8,800,000

20,000,000 .5.700,000

10,163.220 8.5.720,960

$8.5,720,960

To be exchc,;nged for 4--1% bonds

amounting to

867.000 86,700

40.000,000 4,000,000

20,000,000 Cancelled

10,162,800 75,116,.500 .. 2.8811500

~;85, 000,000

Liquidation of the sa-called contractors' debt, (Treasury Notes), for whiCk: no prOVision 1I'1a8 made in the Public 'I'lorks Debt Settlement of 1938, "las aut!1.orized by law on September 16, 1940. The settlement provided for the creation of $8,664,400 principal amount of new 4t% bonds, due 195.5. The proceeds of this issue together with :p9,889,300 principal amount of Public \'lorks 4:~s, 1937-1977. held in the Cuban Treasury" lIere utilized to pay the contractors. The debt to the contractors aggregated $32,180,741 and consisted nrimarily of $20,000,000 of .5~; Treasury gold notes and accumulated interest thereon, held mostly by con­tractors vlho had constructed the central hight-lay. $2,398,77.5 vias al so o"\'red to the American firm 1tIhich built the national Cal)itol. At a debt settlement convention in iIovember 1938, a Government COlmnission 1I'1SS appointed to study this debt. The various creditors agreed to settle their claims at 58~ of the orisinal amount. The funding program described above ,-Jas ad,opted quite readily by the bondholders and other creditors and has been continuously carried out to date. In addition. small amounts of other Cuban external debts 1vere paid off so the.t by the end of 1950 only t\-lO dollar bond isslles remained outstanding, the Republic of Cuba 4~s of 1937-1977 (outstanding in the amount of $67 • .5 million) and the l}~s of 1941-19.5.5 (outstandir~ in the amount of $.5 million).

- 5 -

In addi tion to the debt described in the lJrevious -pages, there \.'ere loans authorized by the 3rport-Import Bank amounting~to $90.4- million. Prior to May 1, 1941, $65.4 million "Forth of loans ,-ras authorized, of .. J111ch $26.9 million was cancelled or eXi')ired leaving a net borrovling by Cuba of $38.5 millio::l. On Nay 1, 19Lt·l, an addi tional authorization of $25 million .. Tas made, of w11ich ;:>7.3 million "ras later cancelled or expired. leaving a net borrm"ing of $17.7 Dillion, making a total net borro\·!ing fOr all times from the Export-Import !:le.n!:: of ,,:;56.2 million .

.dS of June 30, 1950, $10.2 million still remained outstanding on \1hich the interest rate \'ras 4;10 1;1i th sia1dng funds exte:1ding over a l~ year period from AUgust 1, 1950. In the latter part of iiUgust 1950, an internal loan of $45 million uas arranged through Cuban baal{:s. Funds from thi s internal lo£"n '.:Tere used to payoff the remaining $10.2 million Export-Import Bank loan.

Information is not readily available on the use made of the funds 1)rior to the $25 million loan authorized in 1941. In general, it is kno'.m that th~ 19/-1-1 funds ,"lere used for assisting in the reconstruction of the central high~·!8.y and tri butary roads, sani tat ion and wa ter,,,orks at Sa.llt iago de Cuba and Gu.:'l.lltanamo. farm machiner~r, refrigerator \'rarehouses and irrigation.

Table A-l: EXTERNAL DEBT OF CUBA.

(In thousands)

DOLLAR BONDS

4 1/2~, 1937 - 6/30/77 4 1/2%, 1941 - 12/31/55

Total dollar bonds

Date

8/1/50 8/1/50

Amount outstanding

$ 67,469 5,019

$72,4£8

Table A-2-~ ESTIIvrA.TED UITEREST.AHD A!viORTIZATIOn PAYMENTS ON THE EXTF..RliIAL DE13T OF CUBA --- ........ (:::::xpressed in thousands of U.S. dollars)

Dollar bonds Total debt u---4 fl2;b~ 1937-1977 4 1125k.19Ll-i=19.55~ Year Am01l.."'1t r£l.Yments Amount Payments Amount ,Pa.yments

out- Amort i- In- T tal out- Junorti- In- T tal out- .l\.ulOrti- In- T t 1 stnl1Q.ing zation __ terest °s~arrdinEL __ z~tion ter.esj; 0 standj..ng zD.tion terest 0 a

1951 67,469 2,000 3,014 5,014 5,019 875 216 1,091 72,488 2,875 3,230 6,105 1952 65,469 2,000 2,924 4,924 4,144 900 176 1,076 69,613 2,900 3,100 6 .. 000 1953 63,469 2,000 2,834 4,834 3,244 900 136 1,036 66,713 2,900 2,970 5-,870 1954 61,469 2,000 2,744 4,71# 2,344 92.5 9.5 1,020 63,813 2,925 2.839 5,764 19.55 59,469 2 .. 500 2,648 5,148 1,4-19 1,419 64 1,483 60,888 3,919 2,712 6,631 1956 56,969 2,500 2,535 5,035 56,969 2,500 2,535 5.035 19.57 54,469 2,500 2,423 4,923 54,469 2,500 2,423 4,923 1958 51,969 2,500 2,310 4,810 51,969 2,500 2,310 4,810 1959 49,469 2,500 2,198 4,698 1.}9,469 2 .. 500 2,198 4,698 1960 46,969 2,750 2,083 4,833 46,969 2.750 2.083 4,833 1961 44,219 2,750 1,959 4,709 44,219 2,750 1,950 4,709 1962 41,469 2,750 1,835 4,585 41,469 2,750 1,835 4,585 ;1.963 38,719 2,750 1,711 4,461 38,719 2,750 1.711 4,461 1964 35,969 2,750 1,588 4,338 35,969 2,750 1.588 4,3)8 1965 33,,219 2,750 1,464 4,214 33,219 2.750 1.464 4,214 1966 30,469 2,750 1,340 4,090 30,469 2,750 1,340 4,090 1967 27,719 2,750 1,.216 3,966 27,719 2,750 1,216 3,966 1968 24,969 2,750 1,093 3,843 24,969 2,750 1,093 ),843 1969 22,219 2,750 969 3,719 22,219 2,750 969 3,719 1970 19,469 2,750 845 3,595 19,469 2,750 81-1-5 3 .. 595 1971 16,719 2,750 721 3,471 16,719 2,750 721 3.471 1972 13,969 2,750 598 3.)48 1),969 2,750 598 3,348 1973 11,219 2,750 474 ),224 11,219 2,750 474- 3,224-1974 8,469 2,750 350 3,100 8,469 2,750 350 3,100 1975 5,719 2,750 226 2.976 5,719 2,750 226 2,976

iote: There are also $90,000 Cuba 5 1/2a, 1945 which have not been exchanged to new bonds. The right of ex-change has expired.

Year of

issue

1904

1905

1909) 1910) 1911)

1914

Table A-:3: CUEA - EXT~:RNAL DEBT

~

Amount Hama Coupon At issue price

Pe:rcent ($) Amotmt Pur:nose_~n.~l)mme~t.s_~ _

Cuban Government 5% Gvld Bonds 5% 35,000,000 97% 33,950.000 Issued partly to meet obligations to the Army, arising from the ivar of Liberation. Due March 1944. Drawings commencing 1911. Secured by pledge of various excise taJ:es and by pledge of 15% of oustoma receipts of Republic of Cuba. Principal and interest free of all present and future Cuban taxes,

Cuban Government 5% Internal Gold Bonds 5~ 7,964,200 7.964,200 To finance payment of revolutionary bonds of 1895 and 1897. Principal and interest payable in U,S, gold coin. Uo fixed date of maturity. Redeemable at option of Republic of Cuba at par and accrued interest by annual drawings,

Cuban Government 4 1/2% Gold Bonds 4 1/2% (5,500,000 96~ 5,280.000 (5,500,000 98;:' 5,390,000 (5,500.000 98 3/4% 5,431.250

Proceeds devoted to retiring 6% bonds far $2,196.585 and defraying cost of sewering and pnving city of Havana, etc. Due August 1949. Direct obligation of the Government. Pledges and appropriates so much of its customs receipts and other revenues as shall be necessary, ranking in priority to any charge or lien which may be thereafter created on its customs receipts or other revenues. Free of all present .and future Cuban taxes. Redeemable at oEtion of Government on first day of aN month, at lOS and accrued interest, upon not less than )0 days' notice. Drawings beginning 1919 ..

Cuban Government 5% EJ'cternal Gold Loan Stfo: , 10.000,000 98 1/2% 9,850,000

General purposes of the Government. Due February 1949. Direct obligations of Government. 'Secured by pledge of customs receints and 'other revenues sufficient to insure service on loan, subject to the two prior loans of 1904 and 1909. but with priority over subsequent loans. Free of all Cuban taxes. Drawings beginning 1921. Redeemable on thirty daysl notice,

1917 Cuban Government 5% Treasury Bonds 5% 7,000,000 - 7,000,000 Authorized by Cuban Government for issuance in exchange for ~ similar amount of Cuban Ports Co. 5% First l40rtgage 25-yr. Gold Bonds. Redeemable in 14 years by annual drat'lings at par. First re­payment in November 1918. Authorized by Cuban Government. Secured on 50~ of Harbor Improvement dues.

Year of

issue

1919

1922

1923

1927

1928) 1929)

Table A-3: CUJJA - :::;XT~:R}JAL DIIBT - Continued

Eal!:e 2 Amount

Harne Coupon Par At issue price $ Percent ($) Amount

Purpose 8.nd comments

Cuban Government 6% Gold Notes 6~ 20,000,000 20,900,000 $15,000.000 is held by U.S. Government to secure advances made to Cuban Government. Repayable 1929.

Cuba 6%. Due 1929

6cZ 1'0 10,000,000 88.35% 8,835,000

Cuban Government E::ternal 30 year 5 1/2~ 5 1/2% 50,000,000 99 1/4% 49.625,000 Used by Government: Fund of Special accounts; liquidation of 6% loan due 1923; salaries, \-rages etc.~ pensions due before July 1, 1922, De}?t. of Public 1'lorlcs, other depts't eJ:penses of auditing & tax collecting and interest and siliking fund on internal loans due prior to July 1, 1922. Direct obli­gations of the Re)ub1ic additionally secDxed by a charge on certain revenues of the Re~ublic, in­cluding the customs revenues, subject to existing charges, but prior to any future charges. Due January 1953. Callable January 1943 as a vlhole at 100 on 30 days t notice. Exempt from all Cuban taxes, present and future.

Cuban Government Serial 5 1/2% Gold Bonds 5 1/25& 9,000,000 102~ 9.180,000 To fund internal floating debt outste~ding in form of certificates and indebtedness. Due 1937. Not callable-. Free from Cuban taxes, present & futUre. Direct obligation of the Re:)Ub1ic of Cuba but not specifically secured.

Cuban Governttcnt 5 1/2~ Serial Certificates 5 1/2d (10,000,000 99 3/4% 9,975,000 of 1928 f' (10, 000,000 100% 10,000.000 Issued to refund indebtedness of the Government incurred for work completed and accepted in accordance \'1i th prOVisions of the Public 1"lork Law. Public \lorks Serial certifica.tes, 1st issue due Dec. 1931 & June 1932,· 2nd issue due June 1932, Dec. 1932, and June 1933-. No deductions for any Cuban taxes present or future. Not redeemable prior to their resllective maturities. Direct obligations of the Republic of Cuba, specifically secured by a first preferential l~en and charge to extent required for payment of prinCipal and interest in each fiscal year~ on 90% of the normal revenue collected from certain taxes as )rovided by the Cuban Public "Jorks Law.

Year of

issue

1930

1930

1937

Te.ble A-J: C1J'.a.A - :~XT::.FJ.U\L D:;Jl)T - Continued

____________ ~ ____________ ~_~~ 1

Amount name Coupon Pe.r __ &..l.ssue l?r:~!'!. __ _

3; p' 'A, A_ t

Pprpose and co~ents

public Harks 5 1/2% Sinking fund gold bonds

5 1/2% 40,000,000

erge!rt \ 'v i..-JillIW.!-

98% 39 i 200,OOO

Construction of Great Central Highw8¥ t construction of w['.terl'1orks ~ briclges: sowers t drainage systems, public schools ~ public builcl.ings. Due June 19450 Direct obligation the li.e:)ublic~ secureo. by a first preferential lien & cIk'U'ge to extent required foJ:' paym8nt of princil)al & interest on 90% of revenues collected from certain taxes specified in Cu.ban Public l;vorks La\'l Ju.ly 15, 1925. subject to outstanding public 1'forks 5 1/2% serial certificates of 1928.

External Sugar Stabilization Sicl~ing Fund Secured 5 1/2%

5 1/2% 42,000,000 42,000,000

Issued under authority of Sugar Stabiliz~tion Law of Nov. 15, 1930 under which the National Sugar E~porting Corporation was organized on Nov. 19. 1930, the Corporation being organized for the purpose of acquiring up to 1,500,000 tons of Cuban Centrifugal sugar from crops of 1929-1930 and/or 1930-1931, to sell said sugar for benefit of those interested therein in accordance with the Sugar Stabilization Law. Due Dec. 1940. Secured by a first preferential right and lien, to extent re­quired during 1931-19JS. incl. for payment of interest on bonds, u~on all revenues derived during said years from taxes specified in articles XI & XII of Sugar Stabilization Law. As security for payment tho corporation au-.rees to pledge with trustee all Cuban sugar acquired or to be acquired by corporation in exchange for the bonds or deposit receipts thereof,

4 1/2% Bonds of External Debt of Republic of Cuba

4 1/2% 85.000,000 - 85.000,000

lssued pursuant to the Constitution and laws of the Republic, ruld eSlJecially the 1m" of Feb. 14, 193.8, as amended. for the following: $953,700 to holders of $867,000 principal amount of Public ~'Torks .5 172% Serial Certificates due June 30 t 1933 with accrued interest from that date; $44,000,000 to holders of $l,O.OOO,OOO Public Horks 5 1/2% Gold Bonds due June 30, 1934 \i1th interest on and after June 30, 1933.' Q2Q,OOO,000 to holders of 020,000,000 .5 1/2% Deferred Payment 1'1ork Certificates; $10,162,800 to public "­service transportation and railroad companies; $9,883,500 for public works & social laws or for pur,poses of settlement with holders of other obligations of Republic of Cuba or other claimants. Due 1977. Contract obligution of the Republic of Cuba. Secured by pledge of its good faith & credit & the payment of principal w interest are secured by a first preferential lien upon 90% of revenUes ~~. collected in each fiscal year. If 90% of revenues collected from taxes & economic resources are in­sufficient the Rel)ublic undertakes to pay to & deposit \"ith a.gents, moneys from its other fiscal revenues sufficient to cover such deficit in full.

tear of

issue

1933

1941

TB:ble A-3t ctJ.BA - DA"T::RN.A1 DLBT - Continued

fage 4 .timount

Name Coupon Par ___ At issue price _____ ~ Percenb (e) Amount

PrUpose ~d opmments

Treasury notes 5 1/2% 20,000,000 20»000,000 For public works, due June 30, 1935~ issued to se~eral contractors of Ouban Highways. In AUo~st 1933 these notes \-lere extended to 1950 U'ildel' an agl'eement \thereby interest \1aS to be paid to June 30, 1933 and additional security :1rovided.. Ne\"1 notes due 1950 were to be issued pa.1" for llar for no~es due 1935 and additional revenues for p~ment of principal or interest were to be mado available by pledge of l/Z cent per pound on all sugar consumed in Ouba up to $1,100,000 a year.

4 l/Z% Bonds of External debt of Cuba 4 1/2~ 8.664,400 8.6@?,400 Issued to 1"Tarren Bros. 00. in amount $4,379.600 and to Oia. Cubana de Controthtes in amount of $4.284,800 to settle in part the claims of these companies. Due 1955. Secured by a second lien on proceeds obtained from taxes and economic resources which are pledged to secure the external secured sinkin6 fund 4 1/2% of 1937 due 1977. Principal and interest p~able free from and without deduction for taxes and governmental charges now or hereafter established by the Re~?ubl1c of Ouba.

Sources: Foreign B~ndholders Protective Oouncil Inc •• Handbook of American Underwriting of Foreign Securities; Kimber's Record of Government Debts; IIIoody t s Governments and Municipals.

Table A-4

Cuban External 4-1[2's of 1211-1977

Amount Sinking Closing

Out (tandlng Fund Price $OOO's omitted) ~N.Y.S.H.) Yield Price Range .

High ~ 1937 11 79,224 0 60 7.76 - -1936 E. 80,000 500 59-3/4 7.83 62-5/8 52-3/4 1939 11 80,816 1,000 57 8.20 60 49-1/2 1940 69.738 1,000 53-1/2 8.77 62 51-5/S 1941 79,831 1,000 72-1/2 6.50 78 49-1/2 1942 77,831 1,000 73-3/4 6.40 83 68-1/2 194) 76.900 1,000 99-1/4 4.54 100-3/8 72-5/6 1944 76,218 1.500 106 minus g.l 108-1/8 100-3/4 1945 75,469 1.500 112-1/2 minus y 112-1/2 105-1/2 1946 73,969 1.500 112 minus '5:../ 115 110 1947 72,469 .1,500 116 minus ?:..I 116-1/Z 111-1/Z 1948 70,969 1,500 111-1/4 minus gj 118 107-1/8 1949 68.969 2,000 111-3/8 (minus by 113-7/8 104-1/8

(8-1/8 points W

1950 66.969 J.I Z,OOO 111-7/8 (minus by 11Z-1/4 111-1/4 (9-5/8 points C~./

1951 64,969 2,000 112-3/8 111-1/4 1952 62,969 2,000 1953 60,969 2,000 1954 58,469 2,500 1955 55,969 2,500 1956 53,469 2,500 1957 50,969 2,500 1958 48,469 2,500 1959 45,719 2,750 1960 42,969 2,750 1961 40,219 2,750 1962 37.469 2,7.50 1963 34,719 2,750 1964 31.969 2,750 1965 29,219 2,750 1966 26,469 2,750 1967 23,719 2,750 1968 20.969 2,7.50 1969 18,219 2.7.50 1970 15,469 2,750 1971 12,719 2,750 1972 9.969 2,750 1973 7,219 2,750 1974 4,469 2,750 197.5 1.719 2,750 1976 2,750 1977 2,750

NOTJil: Footnotes on next pag~.

. .. / ...

Table A-4 (cont'd) - Page 2.

11 Includes $8,883.500 in treasury but excludes $3,292,400 held for delivery in exchange for old obligations not surrendered.

E . Estimated

gJ Yield to next call date.

11 There is a slight difference behleen the scheduled amortization nnd the amounts sho\m as outstanding possibly due to the difference in dates in which the figures are shown.

Note: Amounts outstanding after 1948 represent estimates based on si~~~ing fund provisions.

Sources: Noody's Governments, Foreign Bondholders Protective Council, and Internation<"'l financial Statistics.