Foreign Relations of the United States, 1961–1963, Volume XII, American Republics

412. Memorandum of Conversation¹

Washington, April 4, 1961.

SUBJECT

• Cuban Situation; Atomic Irrigation Scheme; Economic Survey; Double Taxation

PARTICIPANTS

• The Secretary
• Pedro Beltran, Prime Minister and Minister of Finance of Peru
• Fernando Berckemeyer, Ambassador of Peru
• Theodore C. Achilles, Task Force on Latin America
• Wymberley DeR. Coerr, Deputy Assistant Secretary for Inter-American Affairs
• Richard A. Poole, Officer in Charge of Peruvian Affairs, WST

Cuba and Related Matters

The Secretary welcomed Prime Minister Beltran. He opened the conversation by discussing the grave situation in Laos and then turned to the Cuban problem, which he stated was, of course, a matter of great preoccupation to the United States Government.

Prime Minister Beltran agreed that the situation in Cuba and the ramifications of the Cuban problem throughout Latin America were indeed very serious. It was his feeling that there was no time to be lost, as Castro’s hold on Cuba was ever strengthening, with increasing arms from the Soviet bloc, and as Castroist activities throughout Latin America could have grave consequences for the Hemisphere. He felt that the United States would be losing precious time by attempting to get the support of additional Latin American countries for concerted action, as he saw little hope of those countries joining in. He was convinced that action should be taken by the U.S. as soon as possible and that this action should be quick and decisive. He realized that there would be considerable outcry in Latin America against U.S. intervention. However, many of the Latin America leaders who would cry out against us publicly would congratulate us privately. It is an unfortunate fact, he added, that these leaders are so afraid of Castroist, Communist leftist influence on their masses that they feel they have to take such an equivocal position. If our action were quick and decisive, Beltran continued, he felt sure the adverse reaction would not last and that the event would soon be forgotten as a live issue, as in the case of Guatemala and the assassination of Lumumba.²

When the Secretary referred to Peru’s break with Cuba³ and asked what Beltran felt the chances were of other Latin American countries taking similar action, Beltran said Peru had been very disappointed when, prior to the break, it had attempted unsuccessfully to persuade other countries such as Colombia and Argentina to do so concurrently. Here again was an indication of fear of local reactions.

The Secretary then asked what Beltran felt the reactions in Latin America would be if the OAS were to dissolve. Beltran felt that, despite Latin American reluctance to take concerted action, those countries would view with great concern any signs of dissolution of the OAS and would therefore make every effort to prevent this from happening.

Proposed Atomic Explosion to Divert River for Irrigation

Prime Minister Beltran then turned to a subject he had discussed briefly with the Secretary at the University of California in Berkeley.⁴ This concerned a scheme which had just been broached to him (Beltran) by Professor Teller to explore the possibility of diverting the waters of the Huancabamba River to flow westward in order to irrigate the barren Pacific coastal desert of northwestern Peru. In response to the Secretary’s questions, Beltran explained that the Huancabamba is a tributary of the Maranon, which in turn is one of the two principal tributaries forming the Amazon. Professor Teller’s scheme would involve an atomic explosion to blow off the top of the Andean ridge separating the upper reaches of the Huancabamba from the western watershed of the Andes. Professor Teller had guessed this would be about a thousand feet vertically to be removed, although Beltran guessed it would be more like 3,000 feet. Beltran thought that the width at the base of the portion to be removed would be about 3 miles, but he said this too was a pure guess. Professor Teller had told him that this sort of explosion could be precisely regulated not only in terms of the amount of earth and rock to be removed, but also in the direction in which this material could be blown, thus making it possible to deposit it in such a way as to dam the Huancabamba into a lake from which the waters would then drop westward to the Pacific. Beltran said Professor Teller had proposed that two nuclear technicians go to Peru to study the possibility of this project, but that they go under some other guise in order to preserve appropriate secrecy.

The Secretary said he would be glad to have his staff look into the matter.

Economic Survey of Southern Peru

Ambassador Berckemeyer took the occasion to express sincere appreciation for the very thorough economic study of southern Peru accomplished under the supervision of the ICA. (NB: The Ambassador was referring to the thirty-odd volume “Regional Plan for the Development of the South of Peru”, dated 1959 and published in 1960, prepared by the joint USOM-Peruvian Servicio Cooperativo Interamericano del Plan del Sur, SCIPA.)

Double Taxation Agreement

Ambassador Berckemeyer also took the opportunity to express his Government’s concern over the fact that the double taxation agreement negotiated between Peru and the United States was still in suspense in the Treasury Department.

In response to the Secretary’s question as to the status of the matter, Mr. Poole explained that an agreement had been negotiated and initialed in November 1960 in Lima by Peruvian and U.S. negotiating teams, for reference to their respective Governments for signature and ratification, and that, while the Peruvian Government was prepared to go ahead with completion of the agreement, further action on our part was in suspense in the Treasury Department pending a policy study of double taxation agreements in general.

1. Source: Department of State, Central Files, 737.00/4-461. Secret. Drafted by Poole and approved in S on May 25.
2. See Foreign Relations, 1961–1963, vol. XX, Document 6, for details on the death of Prime Minister Lumumba.
3. The Government of Peru severed diplomatic ties with Cuba on December 30, 1960.
4. Secretary Rusk and Prime Minister Beltran met on March 20. According to a March 21 memorandum made by the Secretary to the files, “Prime Minister Beltran and I met briefly at Berkeley at a reception where private conversation was difficult. He did say he had something ‘classified’ to discuss with me in Washington; this turned out to be a proposal on peaceful uses of atomic energy he had raised with Dr. [Edward] Teller.” (Department of State, Secretary’s Memoranda of Conversation: Lot 65 D 330)