823.248/10–2349

Memorandum by the Chief of the Munitions Division ( Elliott ) to the Deputy Assistant Secretary of State for Inter-American Affairs ( Barber )

secret

The Munitions Division has received from the Lockheed Aircraft Corporation license applications for the export of four P–80 jet aircraft [Page 768] to the Government of Peru for the Peruvian Air Force. This proposed purchase is the subject of despatch no. 888 of October 23, 1949 from the Embassy at Lima.1

Despatch no. 888 reported that, despite the statements of Mr. Elmer Faucett, the Lockheed representative in Peru, that the Peruvian Government had insisted upon purchasing jet aircraft despite his recommendation to the contrary, the Chief of the U.S. Air Force Mission to Peru “is under the impression that this sale was consummated largely at the insistence of Mr. Faucett whose word and opinions carry great weight with the Peruvian Air Force officials.”

The negotiation of this sale to the Peruvian Government is merely the first successful result of a stepped-up sales promotion effort in Latin America by Lockheed …

. . . . . . .

It is difficult to conceive how in any realistic concept of hemisphere defense Peru would be called upon to operate or maintain aircraft of such an advanced type. The organization of American States envisages consultation with a view toward collective action in the peaceful settlement of disputes among member nations. To permit Peru, a small country with small armed forces and a minimum of modern equipment, to import jet planes from the United States does not appear to be compatible with these objectives.

I question the appropriateness of the expenditure by Peru, an economically backward nation, of large sums for military aircraft when that money could better be spent for productive economic and social purposes. In this connection, I understand that for the years 1946–1948 the Institute of Inter-American Affairs made outright grants to Peru (matched by local currency expenditures) totalling $1,306,000 and that the estimated amount of such grants to Peru for 1949 is $557,830. The dollars which the Peruvian Government contemplates spending for the four P–80’s alone amount to $745,000.

On the basis of the foregoing considerations, I propose to reject the application of the Lockheed Aircraft Corporation for export licenses for four P–80 aircraft for Peru. Your comments with respect to this matter will be appreciated.2

  1. Not printed.
  2. In a note to the Peruvian Ambassador, not printed, dated April 4, 1950, the Secretary of State indicated that the Department had informed the Lockheed Aircraft Corporation that after careful consideration it had been determined that the applications for the export of the aircraft in question could not be approved (923.537/4–450).