113. Memorandum From Richard B. Moon of the Office of Middle American Affairs to the Director of the Office (Wieland)1


  • Recent Arms Purchases By Nicaragua

Delivery has been made of the following military items purchased from Israel by Nicaragua.

68 “Staghound” armored cars. The “Staghound” is a four-wheeled armored vehicle mounting a 37-mm. cannon and 3 machine guns, carrying 5 men, capable of a speed of 60 mph and of going anywhere a jeep can go, and useful for police action and street fighting as well as field work. The vehicles were originally built in Detroit for the British.

20 radio-communications master station units, each with a great many associated field receiving and sending sets.

4 anti-aircraft cannon, probably Bofors models.

An unknown number of mortars, probably 120-mm.

A considerable supply of ammunition for all the foregoing weapons.

The value of the above purchase is estimated (by the New York Times, July 8, 1957) in the neighborhood of $700,000.

According to Irving Davidson, purchasing agent for the Nicaraguan Government, the Nicaraguans desire to maintain only about 25 of the armored vehicles. A certain number, according to Davidson, are to be cannibalized for parts and the remainder to be re-sold to other countries. It was thought earlier by the Nicaraguans that they would be able to sell 28 of the 68 “Staghounds” to Cuba, however, recent indications are that Cuba is not interested in buying at this time. Nor, to our knowledge, do the Nicaraguans have any other prospective “Staghound” buyers lined up. In the past, Nicaragua has helped to finance arms purchases by the same methods they apparently hoped to employ with the above mentioned “Staghounds”, that is, by buying fairly large quantities of equipment and then reselling a part of them to other Latin American countries. Acting thus, as the middleman, they have been able to make up much of the cost of those arms which they desired to keep.

The United States is the chief supplier of arms to Nicaragua. That country has consulted with us often concerning its requests for small arms and other equipment. Most of Nicaragua’s attempts to purchase arms from the United States have met with approval, [Page 236] however, upon occasion, we have attempted to discourage them. Last year, for example, the United States effectively discouraged a similar attempt by Nicaragua to buy surplus tanks and armored equipment in the U.S. and Canada. At that time the Nicaraguans were investigating the possibilities of buying fairly large quantities of such equipment with the hope of re-selling a portion of it in Latin America. We informed them informally, however, that the Department was opposed to this plan, and they dropped the project. Recently Nicaragua has been attempting to purchase some sort of naval coastal patrol vessels. They had in mind obtaining a pair of Corvettes from Israel, however, the United States, which felt this type of vessel was too large and too expensive for Nicaragua’s needs, dissuaded them from buying the Corvettes. Now Nicaragua is seeking a smaller type patrol boat. The present purchase of equipment from the Israeli Government, however, was made without prior consultation with the United States. Although we were aware that the Nicaraguans were “shopping” for arms in Israel and that they had expressed some interest in the “Staghound” type vehicle, we did not know that they contemplated buying in such large amounts, and we were not informed of the purchase until after it had been made.

There is no doubt that the quantity and type of equipment which Nicaragua has now acquired will create a great deal of apprehension among her Central American neighbors, particularly Honduras and Costa Rica. It is probable that attempts will be made by Nicaragua’s neighbors to restore the military balance as soon as possible. The purchase in question might also cause a deterioration in the currently improving relations between Nicaragua and her neighbors.

The United States Position:

On the purchase of the equipment. It must be made clear to the other Central American states that the United States was not associated in any way with this Nicaraguan action. We were not consulted concerning the purchase, nor was our approval sought. We should make it clear to the Nicaraguans that we consider the quantity of equipment acquired to be in excess of Nicaragua’s normal defense needs or her hemispheric defense commitments. Further, we should remind the Nicaraguans that the United States would greatly regret any deterioration of the relations between Nicaragua and her neighbors as a result of this arms purchase. In addition, we should call to the attention of Nicaragua the fact that equipment purchased from European sources often proves unsatisfactory in the long run because of the difficulties in maintaining them and obtaining spare parts.
On the possible re-sale of the equipment. We should remind the Nicaraguans that the Department views with disfavor any Nicaraguan [Page 237] effort to act as middleman in the selling of arms in Central America or any attempt to arm groups with hostile intentions.
On the possible attempt of other Central American states to restore the military balance by buying arms from the United States or from other sources. The United States would view with disfavor any attempt at an arms race in Central America. Although the United States has, in the past, assisted the countries of Central America to meet their economic and military needs, should these countries begin to expend their scarce wealth in a general arms build-up, it might become necessary for the United States to take a long and critical look at its economic and military policies toward Central America.2

  1. Source: Department of State, Central Files, 717.56/7–957. Confidential.
  2. In circular airgram 564 to Managua, July 18, the Department informed the Embassy of the delivery of military equipment to Nicaragua. The airgram reads in part: “Although the Department was generally aware that Nicaragua was shopping for military equipment in Israel, we were not consulted concerning the purchase in question, nor was our approval sought. The Department was surprised by the quantity of equipment purchased and feels that it is in excess of Nicaragua’s normal defense needs or its hemispheric defense commitments.” (Ibid., 717.56/7–1857)