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  4. Document 228

228. Memorandum of conversation, February 20, between President Kennedy and President Bentancourt and other U.S. and Venezuelan officials1

February 20, 1963, 4 p.m.
[Facsimile Page 1]

SUBJECT

  • Second and Final Conversation between President Kennedy and President Betancourt of Venezuela—Flight of Capital from Venezuela (Part 6 of 6 Parts.)

PARTICIPANTS

  • For the United States:

    • President Kennedy
    • The Secretary of State
    • Edwin M. Martin, Assistant Secretary for Inter-American Affairs
    • Ambassador C.A. Stewart
    • A.B. Duke, Chief of Protocol
    • D.F. Margolies, Deputy Director, Office of East Coast Affairs (State)
    • Ralph A. Dungan (White House)

  • For Venezuela:

    • President Betancourt
    • Ambassador Tejera Paris
    • Falcon-Briceño, Foreign Minister
    • Gonzalez, Minister of Development (and representative of COPEI)

1. Restoration of Confidence in Venezuela

President Kennedy referred to the flight of capital from Latin America and asked how this affected Venezuela. President Betancourt said that there had been considerable flight of capital from Venezuela, mainly from two causes. First, some capital had been [Facsimile Page 2] attracted to Venezuela during the dictatorship which he characterized as piratical since it gained 20 to 40 percent interest. With the end of the dictatorship this capital had left Venezuela. Second, in the beginning years of his administration there had been uncertainty as to the political stability of his regime, and fear of military take-over. A spreading loss of confidence gave rise to a flight of capital of considerable proportions. He said that his government had since become more firmly established, as evidenced by the rapid suppression of the two military revolts, and confidence had been greatly restored.

His finance Minister told him that the flight of capital had come to an end by last year, and in fact there appeared to be some re-flux of capital into Venezuela. The improvement of reserves which reflected this situation was evidenced by the fact that recently GOV had paid off a commercial bank loan of $67 million in advance of the due date thereby saving $3 million interest.

2. Concluding remarks

President Kennedy expressed appreciation for the talk. President Betancourt said that he had hoped to have an opportunity of a sincere and frank exchange of views about hemisphere problems with the President and was deeply gratified by the way the meeting had worked out.

  1. Flight of capital from Venezuela. Confidential. 2 pp. Kennedy Library, National Security Files, Countries Series, Venezuela, March–May 1963.↩