In my last annual message I expressed the hope that the prevalence of quiet on the border between this country and Mexico would soon become so assured as to justify the modification of the orders then in force to our military commanders in regard to crossing the frontier, without encouraging such disturbances as would endanger the peace of the two countries.  Events moved in accordance with these expectations, and the orders were accordingly withdrawn, to the entire satisfaction of our own citizens and the Mexican Government.  Subsequently the peace of the border was again disturbed by a savage foray under the command of the Chief Victoria, but by the combined and harmonious action of the military forces of both countries his band has been broken up and substantially destroyed.

There is reason to believe that the obstacles which have so long prevented rapid and convenient communication between the United States and Mexico by railways are on the point of disappearing, and that several important enterprises of this character will soon be set on foot, which can not fail to contribute largely to the prosperity of both countries.

New envoys from Guatemala, Colombia, Bolivia, Venezuela, and Nicaragua have recently arrived at this capital, whose distinction and enlightenment afford the best guaranty of the continuance of friendly relations between ourselves and these sister Republics.

The relations between this Government and that of the United States of Colombia have engaged public attention during the past year, mainly by reason of the project of an interoceanic canal across the Isthmus of Panama, to be built by private capital under a concession from the Colombian Government for that purpose.  The treaty obligations subsisting between the United States and Colombia, by which we guarantee the neutrality of the transit and the sovereignty and property of Colombia in the Isthmus, make it necessary that the conditions under which so stupendous a change in the region embraced in this guaranty should be effected—­transforming, as it would, this Isthmus from a barrier between the Atlantic and Pacific oceans into a gateway and thoroughfare between them for the navies and the merchant ships of the world—­should receive the approval of this Government, as being compatible with the discharge of these obligations on our part and consistent with our interests as the principal commercial power of the Western Hemisphere.  The views which I expressed in a special message to Congress in March last in relation to this project I deem it my duty again to press upon your attention.  Subsequent consideration has but confirmed the opinion “that it is the right and duty of the United States to assert and maintain such supervision and authority over any interoceanic canal across the isthmus that connects North and South America as will protect our national interest.”

The war between the Republic of Chile on the one hand and the allied Republics of Peru and Bolivia on the other still continues.  This Government has not felt called upon to interfere in a contest that is within the belligerent rights of the parties as independent states.  We have, however, always held ourselves in readiness to aid in accommodating their difference, and have at different times reminded both belligerents of our willingness to render such service.