602. Telegram 3904 From the Embassy in Peru to the Department of State1 2

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  • Foreign Minister’s Concern Over Deterioration US-Peruvian Relations

1. During call on FonMin this morning on exodus of Military Missions (Lima’s 3876) Minister expressed his deep concern over present course of US-Peruvian relations. He said he did not see a turning point or the possibility of improvement in near future. I reiterated my previous pleas for Peru’s agreement to early date for fisheries conference. This I saw as best possibility of changing tide and improving atmosphere in Washington. I suggested that Peru encourage Chile and Ecuador to go to early conference with us to discuss problem in southern Pacific. Minister repeated that as long as sanctions existed Peru and Ecuador would find it impossible to participate in such conference. He suggested that if we should raise sanctions these two countries could then agree to meet with us.

2. Minister then turned to IPC problem which he said was still hanging over us and even more difficult. He said he had read in morning papers that AID Mission was being cut in half (AP dispatch May 26 from Washington). Furthermore it was generally believed that Hickenlooper Amendment already applied since no credits and no loans forthcoming from US.

3. I explained that we had been reducing personnel of our [Page 2] overall diplomatic mission since Jan 1, 1968 as result of our balance of payments problems. My whole Mission had been reduced by 24 percent but that AID and Military Missions had taken largest cuts.

4. On IPC negotiations I referred to specific formulas which US team had proposed on last day of meetings in Washington May 14. I said my govt was waiting for some response to these specific suggestions to determine whether it would be practical to send Amb Irwin back to Lima to continue conversations. Minister denied any knowledge of specific proposals made by US side and expressed surprise that Peruvian team had returned with any special formula for GOP consideration. I promised to return to Embassy and review my telegraphic reports on this last meeting but repeated my recollection of some specific proposals for GOP consideration and my belief that US Govt was awaiting some Peruvian reaction to them. Minister said he was awaiting return of Amb Letts who was an experienced diplomat to give him full report on Washington negotiations. He implied he had not gotten much substance from other three members who returned May 16.

Comment: On fisheries problem would it be possible for USG to provisionally lift foreign military sales ban for Ecuador and Peru if they would agree in return, to attend Quadripartite Fisheries Conference?

On IPC should this Embassy inform FonMin of formula contained para 12 State 77823 since it is obvious that our position and our suggestion on how to resolve compensation issue has not been communicated in any concrete manner to FonMin or very possibly to other members Peruvian Cabinet.

  1. Source: National Archives, RG 59, Central Files 1967–69, POL PERU–US. Confidential. In telegram 86660 to Lima, May 28, the Department directed Jones to investigate the Peruvian Government’s position further, specifically requesting he determine if the Foreign Minister’s suggestion regarding the raising of sanctions on Peru and Ecuador (mentioned in the first paragraph) had Velasco’s backing (Ibid.).
  2. Ambassador Jones recounted a phone call with the Peruvian Foreign Minister in which they discussed deteriorating U.S.-Peruvian relations, the IPC, and the fisheries problems.