328. Telegram 691 From the Embassy in Guatemala to the Department of State1 2
Subject:
- Prognosis of What to Expect From Arana: Implications for U.S. Policy
Ref:
- Wiggins/Krebs Telcon
1. Although firmly planted on right, Arana gave indications during campaign that he is a moderate and was disturbed by some of extremist elements with his political coalition. He also must realize Guatemala City elected leftist mayor and “parties of left” won 57 percent of votes nationwide. He has spoken of forming government of national union and of appointing qualified apolitical people to his cabinet.
2. In internal affairs, Arana will probably emphasize:
(A) Aggressive anti-crime and anti-terrorism campaign which will involve some reorganization of police and possible additional equipment purchases for armed forces. (It will also produce sharp reaction from FAR and PGT/FAR when their men are taken.)
(B) In rural areas, (1) aid to small and medium farmers in form of technical assistance and less restrictive bank credit; (2) encouragement to artisans; [Page 2] (3) infrastructure, especially road building;
(C) In financial area, monetary stability, reform of banking system, reduction of export taxes (probably including coffee), elimination of exchange controls. He has also pledged no new or increased taxes—although he has not yet confronted realities of government. What he has said to me is that he can greatly increase revenues through government courageous enough to enforce taxes presently on books. Arana’s platform makes public pledge to improve tax collection.
(D) Foreign private investment probably will be moderately encouraged in those areas which do not compete with, or are not considered threat to, Guatemalan business community;
(E) Intensive attention to interests of private business sector, involving laissez-faire and “hands off business”;
(F) For masses, greater job opportunities, better education and public health;
(G) Cooler relationship with main sectors of organized labor that demonstrated by current administration;
(H) Administrative reform and improvement civil service.
3. On international policy, Arana has announced his support of CACM and continued Guatemalan participation in other hemispheric and world organizations. Belize may be real problem. Arana in all public statements has taken hard line that Belize part of Guatemala as stated in constitution. He has even talked publicly of need for military solution. Arana’s attitude on Belize bodes ill for current tripartite talks. On positive side, Roberto Herrera—Arana’s pricipal foreign policy adviser, who we understand was offered post of Foreign Minster last night—is qualified expert on Belize and sophisticated student of Belizean problem. Arana himself almost totally [Page 3] ignorant of problem and did not make it important issue in campaign.
4. Regarding implications for U.S., we stated our belief in FY 1971 CASP that Arana victory would be fully compatible with U.S. security requirements. As constitutionally elected president, Arana in excellent position continue evolution of viable political system which first CASP objective. Embassy inclined believe Arana government will not adopt extreme rightist posture. Arana made no mention of population control during campaign but we doubt that he would support as strongly as does this government current AID supported population programs.
5. Current aid programs will have to be thoroughly reviewed with Arana and members of administration. Education loan appears to be in line with aid to education proposed by Arana group, and Vice President elect Eduardo Caceres Lenhoff advocates assistance to rural sector. Arana government would probably ask us to increase assistance to police.
6. U.S. rural sector loan appears to jibe with Caceres thinking, and those in Arana camp interested in rural area. (This will be subject separate message.)
7. As military man who has had number years contact with U.S. advisers and military people both here and in Washington, Arana can be expected to continue traditional ties between armed forces of our two countries. However, as noted above, he might be inclined to purchase new equipment for armed forces, especially new jets for air force. If U.S. were not in position to provide such aircraft, Arana might seek them elsewhere.
8. In one of his first statements after election, Arana said he would be President of all Guatemalans and not represent solely those parties and groups which supported his candidacy. During campaign he [Page 4] also has demonstrated sensitivity to opposition charges that he “assassin of Zacapa”. Arana probably will tend to be more moderate and centrist than majority of people expect. U.S. interest would best be served by having Arana succeed in developing broad base of support for his programs, thus continuing progress President Mendez Montenegro has made in developing constitutional democratic institutions.
- Source: National Archives, RG 59, Central Files 1970–73, POL 14 GUAT. Secret; Immediate. In a March 3 Intelligence Brief, INRB–45, INR concluded: “While Arana faces many problems and pitfalls, he can provide Guatemala with a constructive administration and the U.S. probably will be able to work with him.” (Ibid.)↩
- The Embassy offered its prognosis of what to expect from President-elect Arana and the implications for U.S. policy. The Embassy suggested he would probably be more moderate and centrist than most expected.↩