In the settlement of the question of the northeastern boundary little progress has been made. Great Britain has declined acceding to the proposition of the United States, presented in accordance with the resolution of the Senate, unless certain preliminary conditions were admitted, which I deemed incompatible with a satisfactory and rightful adjustment of the controversy. Waiting for some distinct proposal from the Government of Great Britain, which has been invited, I can only repeat the expression of my confidence that, with the strong mutual disposition which I believe exists to make a just arrangement, this perplexing question can be settled with a due regard to the well-founded pretensions and pacific policy of all the parties to it. Events are frequently occurring on the northeastern frontier of a character to impress upon all the necessity of a speedy and definitive termination of the dispute. This consideration, added to the desire common to both to relieve the liberal and friendly relations so happily existing between the two countries from all embarrassment, will no doubt have its just influence upon both.

Our diplomatic intercourse with Portugal has been renewed, and it is expected that the claims of our citizens, partially paid, will be fully satisfied as soon as the condition of the Queen's Government will permit the proper attention to the subject of them. That Government has, I am happy to inform you, manifested a determination to act upon the liberal principles which have marked our commercial policy. The happiest effects upon the future trade between the United States and Portugal are anticipated from it, and the time is not thought to be remote when a system of perfect reciprocity will be established.

The installments due under the convention with the King of the Two Sicilies have been paid with that scrupulous fidelity by which his whole conduct has been characterized, and the hope is indulged that the adjustment of the vexed question of our claims will be followed by a more extended and mutually beneficial intercourse between the two countries.

The internal contest still continues in Spain. Distinguished as this struggle has unhappily been by incidents of the most sanguinary character, the obligations of the late treaty of indemnification with us have been, nevertheless, faithfully executed by the Spanish Government.

No provision having been made at the last session of Congress for the ascertainment of the claims to be paid and the apportionment of the funds under the convention made with Spain, I invite your early attention to the subject. The public evidences of the debt have, according to the terms of the convention and in the forms prescribed by it, been placed in the possession of the United States, and the interest as it fell due has been regularly paid upon them. Our commercial intercourse with Cuba stands as regulated by the act of Congress. No recent information has been received as to the disposition of the Government of Madrid on this subject, and the lamented death of our recently appointed minister on his way to Spain, with the pressure of their affairs at home, renders it scarcely probable that any change is to be looked for during the coming year. Further portions of the Florida archives have been sent to the United States, although the death of one of the commissioners at a critical moment embarrassed the progress of the delivery of them. The higher officers of the local government have recently shewn an anxious desire, in compliance with the orders from the parent Government, to facilitate the selection and delivery of all we have a right to claim.

Negotiations have been opened at Madrid for the establishment of a lasting peace between Spain and such of the Spanish American Governments of this hemisphere as have availed themselves of the intimation given to all of them of the disposition of Spain to treat upon the basis of their entire independence. It is to be regretted that simultaneous appointments by all of ministers to negotiate with Spain had not been made. The negotiation itself would have been simplified, and this long-standing dispute, spreading over a large portion of the world, would have been brought to a more speedy conclusion.

Our political and commercial relations with Austria, Prussia, Sweden, and Denmark stand on the usual favorable bases. One of the articles of our treaty with Russia in relation to the trade on the northwest coast of America having expired, instructions have been given to our minister at St. Petersburg to negotiate a renewal of it. The long and unbroken amity between the two Governments gives every reason for supposing the article will be renewed, if stronger motives do not exist to prevent it than with our view of the subject can be anticipated here.

I ask your attention to the message of my predecessor at the opening of the second session of the Nineteenth Congress, relative to our commercial intercourse with Holland, and to the documents connected with that subject, communicated to the House of Representatives on the 10th of January, 1825, and 18th of January, 1827. Coinciding in the opinion of my predecessor that Holland is not, under the regulations of her present system, entitled to have her vessels and their cargoes received into the United States on the footing of American vessels and cargoes as regards duties of tonnage and impost, a respect for his reference of it to the Legislature has alone prevented me from acting on the subject. I should still have waited without comment for the action of Congress, but recently a claim has been made by Belgian subjects to admission into our ports for their ships and cargoes on the same footing as American, with the allegation we could not dispute that our vessels received in their ports the identical treatment shewn to them in the ports of Holland, upon whose vessels no discrimination is made in the ports of the United States. Giving the same privileges the Belgians expected the same benefits—-benefits that were, in fact, enjoyed when Belgium and Holland were united under one Government. Satisfied with the justice of their pretension to be placed on the same footing with Holland, I could not, nevertheless, without disregard to the principle of our laws, admit their claim to be treated as Americans, and at the same time a respect for Congress, to whom the subject had long since been referred, has prevented me from producing a just equality by taking from the vessels of Holland privileges conditionally granted by acts of Congress, although the condition upon which the grant was made has, in my judgment, failed since 1822. I recommend, therefore, a review of the act of 1824, and such a modification of it as will produce an equality on such terms as Congress shall think best comports with our settled policy and the obligations of justice to two friendly powers.

With the Sublime Porte and all the Governments on the coast of Barbary our relations continue to be friendly. The proper steps have been taken to renew our treaty with Morocco.

The Argentine Republic has again promised to send within the current year a minister to the United States.