gration of its subjects to the United States with
a dispassionate fairness and to cooperate in such measures as may
tend to prevent injurious consequences to the United States. The
negotiations are still proceeding, and will be pressed with diligence.

A question having arisen between China and Japan about the Lew Chew
Islands, the United States Government has taken measures to inform
those powers of its readiness to extend its good offices for the
maintenance of peace if they shall mutually deem it desirable and find
it practicable to avail themselves of the proffer.

It is a gratification to be able to announce that, through the
judicious and energetic action of the military commanders of the two
nations on each side of the Rio Grande, under the instructions of
their respective Governments, raids and depredations have greatly
decreased, and in the localities where formerly most destructive
have now almost wholly ceased. In view of this result, I entertain a
confident expectation that the prevalence of quiet on the border will
soon become so assured as to justify a modification of the present
orders to our military commanders as to crossing the border, without
encouraging such disturbances as would endanger the peace of the two
countries.

The third installment of the award against Mexico under the claims
commission of July 4, 1868, was duly paid, and has been put in course
of distribution in pursuance of the act of Congress providing for the
same. This satisfactory situation between the two countries leads me
to anticipate an expansion of our trade with Mexico and an increased
contribution of capital and industry by our people to the development
of the great resources of that country. I earnestly commend to the
wisdom of Congress the provision of suitable legislation looking to
this result.

Diplomatic intercourse with Colombia is again fully restored by the
arrival of a minister from that country to the United States. This
is especially fortunate in view of the fact that the question of an
interoceanic canal has recently assumed a new and important aspect and
is now under discussion with the Central American countries through
whose territory the canal, by the Nicaragua route, would have to pass.
It is trusted that enlightened statesmanship on their part will see
that the early prosecution of such a work will largely inure to
the benefit, not only of their own citizens and those of the United
States, but of the c