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

HA–22. Memorandum from the Acting Director of the International Cooperation. Administration (Saccio) to the Under Secretary of State for Political Affairs (Merchant)¹

Washington, June 20, 1960

SUBJECT

• Budgetary Support for FY 1959–1960 to Haiti.

The Haitian request for budgetary support for the fiscal year ending September 30, 1960 was submitted by a committee representing the Government of Haiti on May 24, 1960. This request was for $5 million for the months of June, July, August and September, 1960. In view of the size of this request it is doubtful if the provision of $1 million will do much to satisfy the desires of the Duvalier Government.

The Haitian request for $5 million includes $2.4 million for an alleged shortfall of “fiscal” receipts, $1.3 million for unbudgeted annual payments on international debts and contributions, and $1.8 million for restoration of salary cuts and other desired expenditures. Both the Embassy and the USCM have recommended a negative response to this request and have reported that the Haitian presentation has not been justified, that there is no reason for expecting a shortfall in fiscal receipts and that the request fails to establish a real need for the aid.

If the $1 million is made available during the present Haitian current fiscal year, it will undoubtedly results in a demand for at least $7 million and possibly more for budgetary support for the coming fiscal year 1960–1961. In view of the prospective decline in receipts as the result of a short crop of coffee in FY 1960–1961, some budget support appears likely to be required—but the asking price will be much larger if we provide budgetary support this year when it is not needed.

It must be assumed that supplying $1 million for the remainder of this fiscal year will be interpreted by the Haitian Government as an indication that its refusal to carry on a constructive development program which the United States is financing is a sure way to secure budgetary support from the United States and will make any constructive program of economic development practically impossible. This is particularly true when it is taken into consideration that during the present fiscal year the Government of Haiti has followed the policy of not only refusing to help itself but of rejecting constructive help designed to bring economic development.

It is believed that if it is considered necessary for political reasons to make available $1 million for budgetary support during the next two months, then we should be prepared to support the Haitian budget to the extent of some $6 to $8 million during the coming Haitian fiscal year and be prepared for the possibility that in addition Haiti will demand a large amount of development funds “without strings”.

In its most recent communication the Embassy has advised:

“Accordingly consider most productive immediate action would be priority shipment to Haiti of weapons and equipment programmed for army’s mobile light infantry battalion, specifically including in initial increment, as means of dramatizing our support and tightening Merceron’s control over outlying units, at least one of helicopters for battalions helicopter platoon. While initial increment weapons and equipment should be sent with minimum delay, phasing in of subsequent shipments should be on call by and under positive control MAAG acting with Embassy concurrence, not only to avoid glutting but to assure maximum leverage all times. If this recommendation approved, MAAG will initiate immediate request for weapons, training, ammunition, and equipment to be included in initial increment.

“As related matter, of importance only secondary to support of army infantry battalion, consider that immediate grant to Haiti under MAP of C-47 aircraft for air corps, to be used for military airlift and by Cohata, would have important impact on army generally, on air corps specifically, and would be widely recognized as tangible evidence our support.”

We strongly recommend the Department accept views of officials on the ground, namely, that the United States (1) not provide any budget support for Haitian FY 1960–1961, and (2) provide military weapons and equipment and C–47’s mentioned above.²

L. J. Saccio

1. Source: Department of State, Central Files, 738.5-MSP/7–2060. Secret.
2. In a letter to Acting Director Saccio of July 22, Under Secretary Merchant acknowledged the unsatisfactory conditions that existed in Haiti but advised: “I remain of the opinion that on foreign policy grounds directly related to the Cuban situation we should make available to the Government of Haiti $1 million for budgetary support during the next two months. This should be done without any commitment whatsoever, in our own minds or implied, otherwise to continue budgetary support thereafter. I ask, therefore, that on this understanding ICA proceed to make the necessary arrangements in collaboration with Assistant Secretary Rubottom.” In regard to Saccio’s recommendation concerning military equipment, Merchant offered his support and stated that the Department of State was working closely and urgently on the matter with the Department of Defense. (738.5–MSP/7–2060)
   On July 29, the Embassy at Port-au-Prince was informed of the decision to make available $1,000,000 to the Haitian Government for budgetary support during the following two months in ICATO 34, and Department of State telegram 29, filed respectively under 838.10/7–760 and 738.5–MSP/7–2960.
   Ambassador Bonhomme during a meeting with Ambassador Turkel on August 12 to discuss the United States offer of budgetary assistance, stated that President Duvalier considered the sum of $1,000,000 to be inadequate and needed an additional $1,500,000 immediately. Turkel told Bonhomme that he saw no possibility of increasing the amount offered. (Telegram 47 to Port-au-Prince, August 12; 738.5–MSP/8–1260).