292. Memorandum of a Conversation, Department of State, Washington, October 3, 19571
SUBJECT
- Difficulties Caused by Failure of Bolivian Government To Reach
- Settlement With Former Tin Mine Owners; Outlook for United States
- Economic Assistance to Bolivia in FY–1958
PARTICIPANTS
- Manuel Barrau, Foreign Minister of Bolivia
- Victor Andrade, Bolivian Ambassador
- ARA—Mr. Rubottom
- REA—Mr. Turkel
- OSA—Mr. Silberstein
After an exchange of greetings, Mr. Rubottom said he would like to return to the subject he had been discussing with the Foreign Minister at lunch. As he had indicated previously, it was extremely important for Bolivia to resolve the problem of the tin mines. Foreign Minister Barrau said the government realized this and was trying to attack the problem of surplus labor in the mines. He said Comibol was also seriously handicapped by a lack of capital. With the modest outlay of some $2 million, which, unfortunately, Comibol did not have, some quick returns could be achieved.
Mr. Rubottom said that as long as the problem of settlement with the former mine owners remained unrestored [unresolved], Comibol [Page 617] could not count on outside help. Moreover, the United States Government was restricted in its efforts to assist Bolivia because of this problem. Mr. Rubottom referred to the statement by Senator Green2 which has been published in the Congressional Record of September 19 which had some strong words in this regard and in which the Senator had indicated he planned to institute an investigation of our Bolivian program when the Congress returned.
Ambassador Andrade said he wished to point out that the Senator was mistaken in speaking of confiscation or seizure of the tin properties. He said Bolivia had begun making payments to the mine owners soon after the nationalization, and, therefore, it could not be correctly called confiscation. Foreign Minister Barrau said that in the case of Hochschild, the “retention” payments, because of the way in which they had been set up, now actually amounted to more than the value of the Hochschild properties which had been nationalized. Mr. Rubottom said he understood these retention payments totalled over $12 million. He said he felt the Bolivian Government might be able to do a better job in making this fact known, since up to now the United States public and Congress were getting largely the views of the other side. At the same time, he said, he could not overstate the importance of bringing about a settlement. He wondered whether the Bolivian Government might not wish to take the matter to arbitration under the auspices of some international agency, since the mine owners had indicated they were ready to do so.
Mr. Silberstein mentioned he had just heard that Senator McClellan, Chairman of the Permanent Investigation Committee of the Senate, had asked ICA for certain data in the Bolivian aid program, and presumably was planning some kind of investigation. Mr. Silberstein mentioned that he understood also that ICA was laying special emphasis, in its planning for the FY–1958 aid program, on working up projects to absorb or resettle surplus labor in connection with the Bolivian Government’s labor dismissal program.
Mr. Rubottom said that the Administration consideration of our FY–1958 aid program for Bolivia was nearing completion. He said that, despite the fact that the Congress had cut the overall aid funds this year, he was quite confident now we would be able to continue our aid to Bolivia at substantially the same levels we had been maintaining. Moreover, since it now appeared that Bolivia had little need for food from the United States, it would be possible to devote a great part of the program to economic development projects.
Source: Department of State, Rubottom Files: Lot 59 D 573, Bolivia. Confidential. Drafted by Silberstein.
This is the first part of a four-part memorandum. The other parts concerned travel of Bolivians to Soviet bloc countries, recent political developments in Bolivia, and Bolivian-Brazilian differences over petroleum. (Ibid.)
↩- Theodore F. Green (D.–R.I.), Chairman of the Senate Foreign Relations Committee.↩