293. Paper Prepared in the Department of State1

LATIN AMERICA

Cuba Policy

BACKGROUND

Since 1961 United States policy has sought to isolate Castro’s Cuba within the hemisphere and to deny it economic support from the West generally. That policy is now no more than marginally effective at best.

—Argentina, Mexico, Venezuela, Peru, Panama and the English-speaking Caribbean countries now have full diplomatic and trade relations with Cuba.

—The Federal Republic of Germany had decided to resume full relations; Spain, France and Argentina have among them recently extended Cuba about $2.5 billion in commercial credits over the next few years; Canada and the UK are pushing trade with Cuba hard. Japan is also very interested.

—At the Quito meeting in November a majority of the OAS countries voted in favor of lifting the OAS sanctions on Cuba. Although the proponents of change fell short of the two-thirds required by the Rio Treaty, the OAS sanctions are clearly no longer enforceable as binding obligations on member states.

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Our own bilateral sanctions are under heavy pressure, particularly the travel ban and the restrictions on exports to Cuba by foreign subsidiaries of American corporations. Senator Sparkman has called for a new Cuba policy and support for the old has weakened markedly in the Congress and among the American public.

These developments reflect a widespread perception that Castroism is no longer an external threat and that the policy of isolation cannot be sustained in a world of détente. Normalization of relations with Cuba is also attractive to a number of governments in the hemisphere, both as a low-cost means of placating disaffected elements in their own societies, and as an opportunity to bring some measure of influence to bear on the future evolution of Castro’s regime.

For his part, Castro has begun to probe for an opening to negotiations with the United States. He has let it be known through intelligence sources and public statements that he may be ready to compromise on two key issues: (1) his longstanding precondition that the U.S. “blockade” must be dropped unilaterally before talks could be held with us; and (2) his previously declared refusal to consider compensation for properties expropriated from U.S. owners. The Cuban regime now suggests that lifting the “blockade” could be approached in “phases,” and that compensation might be subject to bargaining if an appropriate payment formula were devised.

Castro’s mutually reinforcing objectives are:

—to end Cuba’s isolation and obtain access to U.S. goods and technology;

—to seal the legitimacy of his regime with U.S. recognition; and

—to lessen his dependency on the Soviet Union.

Although Castro still seeks to discredit the OAS and the historic leadership role of the U.S. in the hemisphere, he has gradually abandoned the export of revolution to Latin America. Cuba now maintains or seeks state-to-state relations throughout the hemisphere except with those governments that directly oppose normalization of relations (Brazil, Chile, Uruguay and Paraguay). By establishing normal relations with other Latin American governments, Castro maneuvers them into conflict with U.S. policy and undermines the purportedly mandatory OAS sanctions. While signalling an interest in dialogue, he is probably prepared to go slow with us, calculating that the trends are all moving in his direction.

Although a few Latin American governments continue to fear Cuban intervention, even those most antagonistic to Castro now seem resigned to a more normal role for Cuba in inter-American affairs. (Cuba was recently readmitted to full membership in the Latin American Caucus at the UN). These governments do continue to attach importance to our firm commitment to foreswear unilateral moves or “surprises” on [Page 788] the Cuba question and to decide on how to deal with the Cubans in concert with the other members of the OAS.

The Soviet Union now appears confident of the stability of the Castro regime and of the ties between Cuba and the USSR. Moscow presumably hopes that the normalization of Cuba’s relations in the hemisphere will help legitimize the Soviet role there and perhaps relieve it of some of the economic burden it carries.

U.S. STRATEGY

The U.S. has two basic interests: to remove the disruptive Cuba issue from the inter-America agenda and to confine Castro’s capacity and inclination for mischief and disruption in the hemisphere. Both require that we exert a measure of control over the evolution of the Cuba issue. Our strategy at this point is to shape a consensus within the OAS that will permit us to eliminate the multilateral sanctions which so trouble our relations in the hemisphere without compromising our own position vis-à-vis Cuba. We seek a step-by-step approach that will preserve our own ultimate bargaining advantages, while leading Castro to make concessions along the way.

THE SITUATION NOW

The immediate problem is our restrictions on U.S. subsidiaries abroad. We have informed Canada and Mexico that these restrictions are under review. A license application by a U.S. subsidiary in Canada to ship office furniture to Cuba should be dealt with this week. We will have to inform the Mexicans shortly whether we are prepared to permit U.S. subsidiaries to participate in a Havana trade fair next month. In all, we are coming fairly rapidly to the point where a definition of policy on this particular issue will be required.

In the OAS, informal consultations have commenced on how the Cuba issue should be handled in the General Assembly next April. Further unilateral defections from the sanctions are unlikely in the interim, but Colombia, Ecuador, and Costa Rica at least will be pressing for collective action in April. They (and others) remain concerned that failure to lift the mandatory sanctions will further undermine the juridical integrity of the OAS and the Rio Treaty.

ISSUES AND CHOICES

With respect to the subsidiary ban, we can continue to consider licenses on a case-by-case basis, granting applications only when serious confrontations with friendly countries are impending. Or, we can decide now to grant licenses as a general rule when the subsidiary is located in a country whose policy favors trade with Cuba.

On the multilateral sanctions, we can continue low-key consultations with key OAS members looking toward the April General As[Page 789]sembly. On that occasion the Foreign Ministers could limit themselves to a formal endorsement of the proposal their OAS representatives have already embraced to amend the Rio Treaty by dropping the two-thirds requirement for lifting sanctions. The stage would then be set for elimination of the Cuba sanctions, once the long process of ratification by governments is completed. Or, we could indicate that we would support the Colombian formula, by which the Foreign Ministers would instruct the OAS Permanent Council specifically to dispose of the Cuba sanctions earlier, on the basis of a majority vote. This would produce definitive action before the summer.

On the bilateral front, we can await the evolution of the Cuba issue in the OAS before deciding what if any response to make to Castro’s apparent overtures. Or, we can begin to signal on our own through a step-by-step relaxation of the subsidiary restrictions, the travel ban and the other more minor U.S. sanctions. (How we play the first of these will be important. A statement that the USG will take into account third-country policies in deciding on licenses for subsidiary trade would probably be taken in Havana as a clear signal.)

NEXT STEPS

We should decide within the next two or three weeks how to move the OAS toward a consensus that will get the Cuba issue off the inter-American agenda. More intensive consultations with the other members will be required. An early policy decision on subsidiary trade is also indicated. By acting before individual exceptions thoroughly erode the current policy, we can attain maximum political impact and avoid further squabbles with third countries.

  1. Summary: This paper reviewed the state of U.S. policy towards Cuba and outlined the issues and choices confronting the United States.

    Source: Ford Library, National Security Adviser, Presidential Country Files on Latin America, 1974–1977, Country Files, Box 3, Cuba 1. Secret; Nodis. Drafted by Shlaudeman on February 7, cleared by Rogers and Gleysteen, and in draft by Bloomfield and Einaudi. Transmitted under a February 7 covering memorandum from Springsteen to Scowcroft indicating it was for use by Kissinger in briefing President Ford.