360. Draft Country Analysis and Strategy Paper for Fiscal Year 1974–19751
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AMBASSADOR’S OVERVIEW
As in the past, U.S. interests in Guyana relate more to Guyana’s potential for trouble than to any intrinsic value the country may have for the U.S. Since achieving independence Guyana has lived under the threatening clouds of a renewal of internal racial violence, of clashes with its neighbors to the west and east, and of becoming a systematically hostile Soviet satellite should the pro-Communist, Marxist-Leninist Cheddi Jagan and his Moscow-oriented PPP return to power. Any of these eventualities would be of concern to the U.S.
Under an avowedly Socialist government, Guyana has embarked on a major effort at nation-building, seeking to develop Guyanese solutions to Guyanese problems, setting its own priorities and resisting efforts of outsiders to tell the Guyanese Government and people how to manage their own affairs. The U.S. thus has the problem of coping with Burnham’s own unique brand of “cooperative socialism,” designed to “feed, clothe and house ourselves by 1976,” which has antiforeign and anticapitalistic overtones and frequently may arrive at economically questionable solutions.
Over the past three years, Guyana has to some extent turned away from its former close association with and dependence on the U.S. and has engaged in a frenetic search for a place and recognition in the Non-Aligned Movement. Although there is clearly an ideological basis for this new affinity and Guyana’s exclusion from the OAS and the inter-American system in general has given it impetus, Burnham privately has explained it as an effort to assure widespread support in the UN against possible renewed Venezuelan aggression, having concluded at the time of the February 20, 1970 attack on Guyanese border [Page 932] forces that the U.S. would not risk its heavy investment in Venezuela by coming actively to Guyana’s assistance. Preoccupation with its credentials in the Third World has led the GOG on occasion to support postures highly critical of the U.S. It has established diplomatic and trade relations with the PRC, from whom it has accepted a substantial aid program, has recognized Castro’s Cuba and is developing trade with it, and most probably will shortly establish similar ties with East Germany.
A major potential problem and source of friction with the U.S. is the GOG’s professed policy, in keeping with its Socialist orientation, of owning and controlling the country’s natural resources, a policy echoed by an overwhelming majority of the non-aligned countries. In 1971 Guyana nationalized the largest and most important foreign-owned industrial establishment in the country, ALCAN’s bauxite-producing subsidiary, DEMBA, but only after reaching a consensual agreement on compensation. The one major U.S. investment in Guyana, Reynolds Guyana Mines, faces the same fate sooner or later. To date, Burnham has not been prepared to risk the consequences of the confrontation with the U.S. a move against Reynolds might bring on, but the threat remains. In these circumstances, private capital, domestic as well as foreign, shows little interest in Guyana, which in turn lends encouragement to the GOG’s ideological propensity to seek development through government entities, participation and control.
The U.S. has devoted substantial effort and treasure in the past to preventing Guyana from becoming a threat to the peace and tranquility of the hemisphere, and to U.S. security, as a South American base for Soviet and Cuban subversion and a haven for forces systematically hostile to the U.S. as it almost certainly would become were Cheddi Jagan to come to power. We have supported Burnham as the only viable alternative to Jagan, and the necessity to continue to do so has not diminished appreciably. There are no other alternatives in sight. Were Burnham to disappear from the scene, those in the PNC who might succeed him would be far more radical and hostile to U.S. interests. Notwithstanding his propensity to pursue economic and political policies not entirely to the liking of the U.S., Burnham is a Guyanese nationalist with whom we can work.
This situation presents the U.S. with a number of challenges and opportunities, all of them revolving around the posture it chooses to adopt in the years immediately ahead. We have shown patience and understanding of Burnham’s domestic and international situations thus far, even though our continued support may not have been matched of late by a notable degree of GOG cooperation. This clearly should continue to be our posture, as difficult as it may be on occasion. To overreact, or to give the impression that we are abandoning [Page 933] Burnham, would enhance Jagan’s opportunity to return to power or, more probably, accelerate the pace of Burnham’s swing to the Left and alienation from the U.S.
To a considerable degree, Burnham has been preempting Cheddi Jagan’s ground, with the major exception of the latter’s subservience to Moscow, for internal political reasons and to enhance his standing in the Third World. He knows that in the process he has irritated the U.S. Once this year’s elections are out of the way, there is a good chance that he may make some effort to mend his fences. We should not deny him the opportunity.
It must not be forgotten that Burnham and Jagan were once allies committed to common policies and philosophies. The split of the PNC away from the PPP was due primarily to conflicting personal ambitions rather than ideology, although racial divisions were politicized in the process and divergent attitudes towards Moscow were a factor. Given a period of relative stability under Burnham, and in view of Jagan’s diabetes and generally diminishing spark which are making the PPP a less cohesive force than in the past, it is not too farfetched to envision that over the next three to five years there could be a drawing together of the PNC and PPP, a degree of reconciliation between the country’s two major ethnic groups and, possibly, the emergence of a one-party state on the East African model in which East Indians would share a greater portion of the benefits of power than they can in present circumstances. There would be monumental problems with Burnham’s more militant African followers and with the Black Power opposition as well as in overcoming the deeply ingrained hostility of the East Indian community as a whole, of course. But the possibility is there.
More probable, at least in the short run, is a continuation of the uneasy truce which now exists among conflicting racial and political groups, with the possibility of occasional bursts of violence, especially in connection with the national elections which must be held by March 30, 1974 at the latest. Charges and countercharges of fraud and widespread irregularities can be expected, as can some erosion of civil liberties.
Over the longer period we can expect to see major efforts at development, particularly in cottage-type, labor intensive industries, in government-directed community self-help projects, in cooperatives, again directed by the government, and in infrastructure. While traditional donors such as Canada, the UK and hopefully the U.S. will continue to render assistance at past levels, an increasing proportion of total aid will come from the international lending agencies such as the World Bank and UNDP and from new friends such as the PRC and, possibly, East Germany. Almost certainly, achievements in the agricultural sector, which is being given top priority, will not measure up to [Page 934] the grandiose plans being laid to populate and develop the interior, especially the Essequibo. How viable the economy will prove to be is a real question, and whether the GOG will be able to maintain the fiscal responsibility it has shown thus far is doubtful.
The future will almost certainly see increasing efforts by the GOG to regiment the populace as it pushes its own concepts of development and nationalism under socialism. Individual liberties may well be eroded, and efforts will be made to influence if not control the judiciary and the media to ensure that they support “national goals.” Burnham may well achieve a two-thirds majority in Parliament through various contrivances so he can amend the Constitution. Nevertheless, we would expect a government under Burnham to retain the form if not the full spirit of a constitutional democracy based on the Westminster System.
In sum, the U.S. should be able to live with a leftist, highly nationalistic regime that is seeking to create a meaningful Guyanese entity. To the extent that Guyana becomes a model for other Caribbean states, as Burnham obviously hopes, the U.S. will have to accept and adjust to that degree of change. If we permit ourselves to be depicted as merely the defenders of the status quo, our influence could be so reduced as to become irrelevant. We should seek to moderate Burnham’s actions so that unacceptable consequences do not result as, for example, seeing to it that future attempts to seize control of foreign enterprises, such as the U.S.-owned Reynolds bauxite operation, involve, at best, some form of partnership and, as a minimum, adequate and prompt compensation, as in the case of the DEMBA takeover.
The U.S. assistance program has been proportionately large, basically for political reasons, and should still remain substantial for the same reasons. But there is in addition a fully justifiable development rationale which is consistent with our pledge to support economic and social progress in the hemisphere. We should, if necessary, be prepared to consider whatever special forms of assistance might serve to tip the balance in Burnham’s favor in the next election. While watching closely the efforts of the PRC and others, such as East Germany, we should not appear to be overly concerned or let ourselves be pushed into competing with them. This conclusion supports continuation of a relatively low profile in Guyana.
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Ambassador
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Summary: Ambassador King stated that while the economic nationalism and leftist orientation of the Guyanese Government might cause friction in bilateral relations, the United States could work with Prime Minister Burnham. King recommended that the U.S. assistance program should remain robust.
Source: National Archives, RG 59, Central Files, 1970–1973, POL 1 GUYANA—US. Secret. Sent as an enclosure to airgram A–6 from Georgetown, February 5, 1973. All brackets are in the original except those indicating text omitted by the editors.
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