220. Memorandum From the Administrator of the Agency for International Development (Hamilton) to President Kennedy1
SUBJECT
- Aid to Brazil
In response to your memorandum of February 52 about aid to Brazil before their elections next fall, I am happy to report that we are about to conclude agreements with Brazil calling for three important programs in the crucial northeast area: (a) a $33 million immediate impact loan-grant program; (b) a $62 million long-range development program; and (c) a very substantial program for emergency food, wheat, corn and dry milk. We also hope to initiate projects elsewhere in Brazil which will have impact before October.
The programs for northeast Brazil derive from the recommendations of the survey team3 which we sent to Brazil last October following up your talk with Dr. Celso Furtado on the Northeast Brazil Development Agency last summer.4 These programs are as follows:
- a.
- Immediate impact. This program is primarily social in purpose and directed to the centers of greatest discontent in the northeast. The main elements are: water supply—public fountains, wells and water systems in cities and towns; labor centers and community self-help development projects; rural electrification; literacy and simple industrial training for those just entering the labor force; and mobile health units. This multiple program will be financed by $15 million in dollar loans and grants plus about $18 million of U.S. local currency. The target is to have these items physically in place before the October elections, so far as possible, with “Alliance for Progress” markers.
- b.
- Long-range development. We plan to participate in a longer range program to attack some of the fundamental social economic problems of the northeast. The accent will be on irrigation, roads, power, primary education, community water supply and agriculture. We are thinking now of a two-year commitment of about $62 million of loans and grants, plus local currency aid with later participation depending on results. Final negotiations will take place within the next few days.
- c.
- Food programs. There are presently two substantial PL 480 food programs being carried on in northeast Brazil and two additional ones about to be initiated. Last December we agreed to supply 40,000 tons of dry milk on a grant basis over a two-year period to be consumed by almost 4 million people, the majority being school children. Shipments have started and the program will be in full operation in a few months. U.S. voluntary agencies are conducting a food distribution program on a grant basis which has already amounted to $6 million thus far in FY 1962.
We are now ready to move on an emergency food supply program consisting of about 25,000 tons of food on a grant basis to be used in kind as partial pay for work relief projects to help people suffering from this year’s unusually bad drought conditions. Brazil has not yet agreed to accept a standard agreement for this type of program. In addition, a sales agreement for 800,000 tons of wheat and some corn is now being negotiated.
Ted Moscoso and I would appreciate your comments about these proposed programs and any others which may seem appropriate to you; and we hope to have the opportunity to discuss them with you.
- Source: Department of State, Central Files, 811.0032/2-962. Official Use Only. A February 9 covering memorandum from Hamilton to Bundy indicates the memorandum is a response to a February 5, request from the President for information on U.S.-sponsored economic projects being implemented in Brazil prior to the October 1962 Congressional, state, and municipal elections there.↩
- Not found.↩
- The report of this survey team was not found.↩
- See Document 211.↩