Foreign Relations of the United States, 1958–1960, Volume V, Microfiche Supplement, American Republics

GT–12. Memorandum from the Officer in Charge of Guatemalan Affairs (King) to the Assistant Secretary of State for Inter-American Affairs (Rubottom)¹

Washington, December 30, 1958

SUBJECT

• Call of the Guatemalan Ambassador, 4:30 p.m., December 30.²

Ambassador Antillón informed me yesterday that he is shortly going on a trip to Guatemala, and that he wished to have a talk with you before his departure. An appointment, subject to your approval, was arranged for this afternoon.

Although I pressed him for details of what he wished to discuss with you, Ambassador Antillón said that he had nothing special in mind and wished merely to exchange views with you on a variety of topics. I believe it likely that he may raise one or more of the following subjects:

1. Pending, DLF Loan Applications.

I have had a talk with Mr. William Ryan of the DLF, who recently returned from a study mission to Guatemala. Mr. Ryan informed me that Hart Perry, Deputy Managing Director for Loans of the DLF, had informed him that only $5 million dollars of presently appropriated funds could be spared for loans to Guatemala. Mr. Ryan said he was favorably impressed by the rubber loan application, and that he was prepared to recommend putting the $5 million into this. Naturally, Mr. Ryan’s recommendations would require approval by his superiors and the DLF Board. Mr. Ryan felt that possibly more could be loaned to Guatemala out of new appropriations for the DLF. If the Ambassador inquires regarding status of the loan applications, you might tell him what you told the Minister of Education on December 22³—that you were sure something would be forthcoming for Guatemala in the matter of DLF loans, but that it was as yet unfortunately impossible to say for what or how much.

2. Training Planes for the Guatemalan Air Force.

Sometime ago the GOG requested permission to purchase ten T-34 training planes for the Guatemalan Air Force.⁴ This request was approved by State and Defense, and the Guatemalans were informed that the price of each aircraft would be between $23 and $27 thousand dollars. The Ambassador has told me that these prices are far too high for Guatemala to pay and has presented a note formally asking for a reduction in the prices and special consideration for Guatemala in this purchase.⁵ In the note he alludes to the fact that we have a Mutual Defense Assistance Agreement with his country.⁶ He has told me that he cannot understand how we can charge such high prices for the trainers, when only a few months ago we sold Guatemala several F–51 fighters for $1,090 each. RPA advises that while the F–51’s were obsolete and surplus, and that token prices could be quoted for them, the T–34’s are currently used by our armed forces and those requested by Guatemala must be released from our active stocks. Should the Ambassador raise this matter, it is suggested that he be told that his note is now being translated and that the Department will be glad to study it to see what, if anything, can be to be helpful to the Guatemalans in this matter, although nothing can be promised as Defense apparently has little or no leeway in negotiating token prices for sales of T–34 aircraft at this time.

3. Coffee Prices.

A favorite theme of Ambassador Antillón is the economic and financial difficulties that Guatemala is experiencing because of the drop in coffee prices. He is well aware of what the United States is trying to do to be helpful in this situation, but tends to use the fall in coffee prices as a reason for requesting us to make all kinds of concessions to Guatemala.

4. U.S. Support for the Ydígoras Governments.

Ambassador Antillón may express to you his view that there is need for the United States to make promptly some tangible and public gesture of support for the Ydígoras administration, such as granting loans or reducing the prices on the trainer planes. He seems to think that we have deliberately withheld support from the GOG. You might, whether or not he raises this subject, make a statement to the effect that we are cooperating with and supporting the Ydígoras Government. You might cite the fact that earlier this year we waited until Ydígoras took office before releasing and programming the $10 million dollars in special assistance that Congress appropriated for Guatemala for FY 1958,⁷ and that the programming of these sums was done in close cooperation with the GOG. You might say also that we have, wherever possible in conformity with our own laws and regulations and our capabilities, tried to comply with requests of the Guatemalan Government. President Ydígoras himself has repeatedly expressed to our representatives gratitude for U.S. assistance.

5. Lead and Zinc Quotas.

The Ambassador may raise the question of Guatemala being assigned a specific quota for export of lead and zinc concentrates to the United States, instead of being included in the 10 per cent general quota for smaller producing countries. We understand that in January a review will be made of the first quarter operation of the quota system, and as the Guatemalan Director General of Mining was informed during his visit to Washington last month, consideration will be given at that time to Guatemala’s request for a specific lead and zinc quota. Guatemala is the largest of the producing countries included in the general quota. However, Guatemalan lead and zinc mining operations have been virtually closed down for several months, and it was the projected reopening of these mines that prompted a request for a specific quota.⁸

The Ambassador’s call might be a good opportunity to remind him of our disappointment over the Guatemalan position that the George B. Soto claim is a closed matter. You might say we are preparing a reply to the latest Guatemalan note on this subject. It is suggested that you ask the Ambassador to convey to his government, during his forthcoming trip, reiteration of our hope that the case may be reopened and a settlement negotiated between the GOG and Mr. Soto’s representatives.⁹

1. Source: Department of State, ARA/OAP Files, Lot 60 D 647, “Col. Carlos L. Antillón Hernandez: Guatemala, 1958.” Confidential.
2. According to the memorandum of their conversation of December 30, Assistant Secretary Rubottom told Ambassador Antillón that the Development Loan Fund would approve part of the $33.5 million in loans requested by Guatemala; “he authorized the Ambassador to tell President Ydígoras that the Department and the U.S. Government were supporting the GOG, were cooperating with it, and were trying to be helpful in every possible way.” (601.1411/12–3058)
3. No record of Assistant Secretary Rubottom’s conversation with the Guatemalan Minister of Public Education, Col. Marco Aurelio Merida Sáenz, on December 22, was found in Department of State files.
4. The request was made in a note from Antillón to Dulles, September 2, 1958. (714.5622/9–258)
5. Antillón’s note was not found in Department of State files.
6. For the text of the Agreement signed at Guatemala City, June 18, 1955, see United States Treaties and Other International Agreements (UST), vol. 6 (pt. 2), p. 2107.
7. Reference is to the Mutual Security Appropriation Act, 1958, approved September 3, 1957; for text, see 71 State 601.
8. Documentation on the question of quotas for Guatemalan exports of lead and zinc to the United States is in decimal file 411.146.
9. Documentation on the Soto claim is in decimal file 214.1151–[illegible in the original] Soto, George B.