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  3. Foreign Relations of the United States, 1955–1957, American Republics: Central and South America, Volume VII
  4. Document 261

261. Memorandum by the Assistant Secretary of State for Inter-American Affairs (Holland)1

Washington , December 12, 1955 .

SUBJECT

  • Notes on Problems in Countries Visited

Bolivia

1.

Arica Pipeline

The project to which the Government attaches highest priority at this time is the proposed pipeline to carry petroleum for export to Arica. We agreed that the Embassy would participate in a study covering the cost estimates of the line, the economics of its operation and such alternative methods of financing as are under consideration. We pointed out clearly to the Bolivians that they could not expect Export-Import financing, for that would violate the established policy of the United States Government.

2.

Possible Export-Import Financing—The Government is interested in financing of power plants. It is also intensely interested in the [Page 532] construction of two highways establishing connection between the Beni agricultural and ranching area in the northern part of the country and the Altiplano.

There are two private financing applications pending. One is for a Grace2 Cement Mill and the other is for the lead operation identified as Metabol.

3.
Mining Mission—Representatives of United States engineering firm3 which is to review the mining industry in Bolivia should be arriving there about this time.
4.
Financial Mission—We agreed with the Bolivians that Karasz of the United Nations would have the role of adviser to the Stabilization Council. This seemed to eliminate the dispute as to the role of the United Nations. It is very important that we find a capable man to head up the United States advisers to the Council.
5.
Brazilian Oil Concessions—The President of Bolivia earnestly asked our help in persuading the Brazilians to terminate the agreement under which they have the right to participate in the development for petroleum production of a large area in eastern Bolivia. He argued that the Brazilians are unable to develop their own territories and clearly are unable to engage in activities abroad.
6.
ICA Mission Chief—Mr. Powell will be leaving Bolivia in the Spring. This is the largest ICA program in Latin America, and it is imperative that a capable man be found as a replacement.
7.
Presidential Succession—The President outlined his views regarding the forthcoming elections. They are reported in a separate memorandum.
8.
Termination of Tin Purchases—We told the Bolivians that they must prepare for the termination by the United States of operations of the Texas City Tin Smelter. They seemed to take the news philosophically. We must give thought to preparation of public opinion there for the disclosure of this decision, if that proves to be the course that the United States follows.
  1. Source: Department of State, Central Files, 110.15–HO/12–1255. Confidential.↩
  2. W.R. Grace and Company.↩
  3. Ford, Bacon and Davis, Inc.↩