Foreign Relations of the United States, 1952–1954, The American Republics, Volume IV

732.5 MSP/7–1653: Telegram

The Chargé in Brazil (Walmsley) to the Department of State

confidential
priority

Rio de Janeiro, July 16, 1953—5 p.m.

57. For State and DMS. Reference Depcirtel 1237,¹ Embdes 1521, April 9² et ante. Military assistance agreement approved by Brazilian Congress in April marking long awaited step forward military phase MSP Brazil. Although Brazilian promulgation completed only mid June, US and Brazilian military groups had anticipated planning phases, designating Brazilian units for hemisphere defense, and making plans for their supply. Likewise, US delegation JBUSMC, anticipating establishment MAAG, took initiative activating program and arranging initial transfer grant-aid material, five B–17’s, June 18, four days after Brazilian promulgation agreement. Delivery these aircraft created favorable Brazilian impression. MAAG now established.

JBUSEDC in final stages work on forty priority projects in transportation, power, shipping, agriculture. These projects estimated require 13.2 billion cruzeiros internal financing and $381 million external, of which $135.4 million now obtained and $48.6 million in negotiation. Projects would provide essential additions to economic infrastructure and should result stimulus to private investment. US assistance indispensable in preparing above projects. Difficulties arose however, with regard termination Joint Commission. Unfavorable Brazilian reaction to US request attributable mainly to fact completion external financing does not coincide with prospect of Joint Commission termination and Brazilian press and congressional critics made it appear US giving new interpretation to alleged understanding re relationship cruzeiro and dollar financing. Although political controversy is continuing in Congress regarding 1951 Brazilian legislation to provide cruzeiro financing, I have reached agreement with new Foreign Minister³ and Finance Minister installed recent weeks to exchange notes July 20 to close Joint Commission when work finished but not later than September 30.⁴ With regard technical cooperation following critique designed assist your appraisal impact and provide new DTC guidance re local problems.

Scope of technical cooperation activities in Brazil increased with beginning full-scale operations under productivity program and new public administration projects. Industrial education program, previously impaired by inadequate cooperation by certain Brazilian officials, now in position resume. We have concluded new agreements with Foreign Office, Minister Education,⁵ Minister Labor,⁶ Minister Agriculture,⁷ which provide continuing bases for activity in these and related fields, namely, special services agreement,⁸ supplementary agreement on industrial productivity, extension of industrial education agreement,⁹ and agricultural and natural resources agreement.¹⁰

Conclusion of these agreements received favorable though modest publicity Brazil press and Brazilian attitude toward technical cooperation continues receptive. Brazilian Government can be expected to give support and contribute its share to agreed programs. Note, however, that at April session ECLA Rio,¹¹ at which economic development was major topic, US technical cooperation received only barest mention in contrast frequent mention and high praise UN technical cooperation activities, fact which suggests importance of watching Latin American attitude toward our technical cooperation programs in coming months.

One possible reason here is that our more recent projects in Brazil have tended become diversified with, resultant thin spread of resources this vast country. Certain projects in public administration and industrial productivity programs are pertinent illustrations.

Also emphasized in our previous telegrams (Embtel 1124, February 10¹² and 980, January 10¹³) programs of maximum effectiveness generally possible only when strongly desired and supported to our satisfaction by Brazilians. Promotion of projects by us unrewarding.

I am also concerned with apparent bureaucratization of technical cooperation in Brazil resulting from increased proportion professional civil servants assigned to projects rather than outstanding specialists who have demonstrated proficiency in private pursuits. There appears moreover, to be concentration personnel Rio of approximately 30 US officials, and only 23 elsewhere Brazil, and purposeful but wasteful build-up of technical cooperation administrative staff (30 people) owing differences in administrative procedures and accounting between TCA and Embassy which thus stopped from giving administrative support. UN agencies in Brazil also increasing personnel which now totals 61 active in matters relating to technical cooperation, mainly in Rio.

In summary, I continue feel and wish emphasize that technical cooperation for Brazil desirable and positive element in US–Brazil relations. Most programs, particularly those which predate technical cooperation legislation (agriculture, public health and minerals) are especially effective and well organized. I am not yet sure some of more recent projects which now take substantial portion of funds will prove equally effective in technical accomplishments or contribution to US objectives.

Walmsley

1. The Department’s circular telegram 1237, dated June 29, 1953, requested reports from the Embassies concerning progress being made toward achieving the objectives of the military security program (700.5 MSA/6–2953).
2. The referenced despatch, from Rio de Janeiro, dated Apr. 9, 1953, contained a summary report on the progress of the mutual security program in Brazil for the quarter ending Mar. 31, 1953 (732.5 MSP/4–953).
3. Vicente Ráo.

4. For text of the exchange of notes, signed at Rio de Janeiro, July 20, 1953, and entered into force on the same date, by which the United States and Brazil agreed to terminate the Joint Commission on Sept. 30, 1953, see 5 UST 112.

   By an exchange of notes, signed at Rio de Janeiro, Sept. 16 and 28, 1953, entered into force on the latter date, the United States and Brazil agreed to extend the life of the Joint Commission until Dec. 31, 1953, to allow the commission to complete the preparation of certain projects and the publication of its studies; for text of the notes, see 5 UST 115. The commission completed its work on Dec. 31, 1953, and was terminated as of that date.

5. Antonio Balbino.
6. João Belchior Marques Goulart.
7. João Cleofas de Oliveira.
8. For text of the special technical services agreement between the United States and Brazil, signed at Rio de Janeiro, May 30, 1953, entered into force provisionally on the same date, and definitively on Nov. 13, 1959, see TIAS No. 5049, or 13 UST 1061.
9. For text of the exchange of notes, signed at Rio de Janeiro, June 29, 1953, and entered into force on the same date, extending the agreement of June 30, 1952, providing for an industrial apprenticeship training program, see TIAS No. 2839, or 4 UST (pt. 2) 1713.
10. For text of the agreement providing for a cooperative program of agriculture and natural resources in Brazil, signed at Rio de Janeiro, June 26, 1953, entered into force provisionally on the same date, and definitively on May 29, 1956, see TIAS No. 4130, or 9 UST 1357.
11. Reference is to the Fifth Session of the UN Economic Commission for Latin America, held at Quitandinha, Brazil, Apr. 9–25, 1953; for information on the session, see Yearbook of the United Nations, 1953 (New York, 1954), pp. 377–382.
12. The referenced telegram concerns the effect on the mutual security program of Brazil’s delay in ratifying the military assistance agreement (732.5 MSP/2–1053).
13. Not printed.