Venezuela
370. Ambassador’s Overview, Country Analysis and Strategy Paper
Summary: The Ambassador’s overview of U.S. interests in Venezuela focused on trade, in particular petroleum. In addition, the Ambassador noted that Venezuela’s foreign policy would become more oriented towards Latin America and Europe, and less towards the United States.
Source: National Archives, RG 59, Central Files, 1970–1973, POL 1 VEN–US. Secret. Drafted by Cox on March 14; cleared by Luers, McClintock, and the CT; approved by Devine. Sent as an enclosure to Airgram A–143 from Caracas, March 18, 1973.
371. Telegram 58100 From the Department of State to the Embassy in Venezuela
Summary: Crimmins and Aguilar discussed anti-Americanism in Venezuela and United States-Venezuelan relations.
Source: National Archives, RG 59, Central Foreign Policy File, [no film number]. Confidential; Limdis. Drafted by Forrester; cleared by Edward Little and Stockman; approved by Crimmins. According to a memorandum of an April 5 conversation between Calvani and Rogers in Washington, the Venezuelan Foreign Minister expressed surprise at U.S. inquiries about changes in Venezuelan policy towards the United States, as reflected in some of Caldera’s speeches. Rogers replied that the U.S. Government had simply asked for a clarification of Venezuelan policy, just as it was frequently asked for clarifications of its own policy. (Ibid., Central Files, 1970–1973, POL VEN–US)
372. Telegram 4042 From the Embassy in Colombia to the Department of State
Summary: Secretary Rogers and Venezuelan officials discussed economic issues in United States-Venezuelan relations.
Source: National Archives, RG 59, Central Files, 1970–1973, ORG 7 S. Confidential; Immediate. Repeated to Caracas. The Secretary’s May 14 statement upon arrival in Caracas is in the Department of State Bulletin, June 25, 1973, p. 906. Rogers was in Bogotá during a May 12–28 tour of Latin America that took him to Mexico, Nicaragua, Venezuela, Peru, Colombia, Brazil, Argentina, the Netherlands Antilles, and Jamaica.
373. Telegram 106610 From the Department of State to the Embassy in Venezuela
Summary: Caldera and Rogers discussed anti-Americanism, economic relations, an energy agreement, the OASGA, and Cuba.
Source: National Archives, RG 59, Central Files, 1970–1973, ORG 7 S. Secret; Priority. Drafted by McClintock on May 27; cleared by Pedersen and Kubisch. Rogers’s May 15 luncheon speech in Caracas is published in the Department of State Bulletin, June 25, 1973, pp. 907–910.
374. Memorandum From the Assistant Secretary of State for Inter-American Affairs (Kubisch) to Acting Secretary of State Rush
Summary: Kubisch informed Rush that on December 12, COPEI candidate Fernandez conceded defeat to AD candidate Andrés Pérez in the Venezuelan presidential election. Kubsich discussed the significance of Pérez’s electoral victory for United States-Venezuelan relations.
Source: National Archives, RG 59, Bureau of Inter-American Affairs, Office of North Coast Affairs, Records Relating to Venezuela, Lot 73D423, 1973 Presidential Elections, Political 14, Venezuela, 1973. Confidential. Drafted by Forrester. Tabs A and B were not attached. In telegram 8948 from Caracas, October 18, McClintock reported that the election would be close and that the United States could live with either the AD or the COPEI candidate. (Ibid., Central Foreign Policy File, [no film number]) In telegram 222224 to Caracas, November 10, the Department observed that it was in the U.S. interest “for December 9 to witness free, orderly, honest exercise in representative democracy followed by peaceful and constitutional turnover of power to whatever leaders people of Venezuela may freely elect to govern them during coming five years.” (Ibid.)
375. Telegram 11017 From the Embassy in Venezuela to the Department of State
Summary: Ambassador McClintock and President-elect Pérez discussed trade matters, in particular petroleum.
Source: National Archives, RG 59, Central Foreign Policy File, [no film number]. Confidential. In telegram 246933 to Caracas, December 19, the Department transmitted a congratulatory message from Nixon to Pérez. (Ibid.)
376. Telegram 252354 From the Department of State to the Embassy in Venezuela
Summary: Kissinger instructed the Ambassador to express the U.S. Government’s deep concern about the steep increase in the price of petroleum.
Source: National Archives, Nixon Presidential Materials, NSC Files, Country Files, Box 797, Latin America, Venezuela, Vol. 2, 1972–. Secret; Immediate; Nodis. Drafted by Forrester on December 29; cleared by Kubisch; approved by Kissinger. In telegram 252282 to Tehran, Jidda, and Kuwait, December 29, the Department instructed posts to express concern over the destabilizing impact of price increases and to promote greater consultation and mutual understanding between oil producers and consumers. (Ibid., RG 59, Central Foreign Policy File, P810097–2368) In telegram 11015 from Caracas, December 28, the Embassy reported that Venezuela had increased its oil prices by 82 percent. (Telegram 11015 from Caracas, December 28; ibid., [no film number])
377. Telegram 2699 From the Embassy in Venezuela to the Department of State
Summary: Shultz and Pérez discussed oil prices. Pérez emphasized that he thought the poorer nations of the world needed to organize to achieve higher prices for essential commodities.
Source: National Archives, RG 59, Central Foreign Policy File, D740069–0387 Secret; Immediate; Limdis. Repeated to Brasília and Rio de Janeiro. In telegram 3759 from Caracas, April 29, McClintock reported that Schacht informed him through an intermediary that Shultz’s visit “had caused a most negative effect not only with President Andrés Pérez but, perhaps more importantly, with those elements of the Venezuelan Cabinet who wished to assume a nationalistic and anti-American stance at this particular time.” However, Schacht wanted “to be a good friend of the United States and is seeking means to back up his arguments to President Andrés Pérez that Venezuela’s best policy is in fact to be a good friend.” (Ibid., P850083–1945)
378. Memorandum From the President’s Deputy Assistant for National Security Affairs (Scowcroft) to the President’s Assistant for International Economic Affairs (Flanigan)
Summary: After Pérez announced a broad policy to nationalize foreign investment, Scowcroft informed Flanigan that the Department of State would tell the Venezuelan Ambassador that while the U.S. Government recognized the sovereign right of expropriation, it expected prompt, adequate, and effective compensation to be paid.
Source: National Archives, Nixon Presidential Materials, NSC Files, Country Files, Box 797, Latin America, Venezuela, Vol. 2, 1972–. Confidential. Scowcroft wrote on the memorandum: “Peter—as we discussed this morning, I think this is getting straightened out. B[rent].” In telegram 90161 to Caracas, May 2, the Department instructed the Embassy to refrain from comment on Pérez’s April 29 statement on nationalization and noted that it intended to discuss the matter with a Venezuelan Embassy representative. (Ibid., RG 59, Central Foreign Policy File, D740105–0537) In a May 3 memorandum, Flanigan informed Scowcroft that the Department’s response was “extraordinarily inadequate.” (Ibid., Nixon Presidential Materials, NSC Files, Country Files, Box 797, Latin America, Venezuela, Vol. 2, 1972–) In a May 3 memorandum to Scowcroft, Low agreed that “State’s reaction to the Venezuelan statement was slow and their outgoing instruction was indeed weak,” and he transmitted a draft reply to Flanigan. (Ibid.)
379. Telegram 93175 From the Department of State to the Embassy in Venezuela
Summary: Shlaudeman informed Aguilar that the U.S. Government expected prompt, adequate, and effective compensation for the expropriation of U.S. assets in Venezuela. Aguilar assured Shlaudeman that Venezuela would implement any nationalization in accordance with its constitution.
Source: National Archives, RG 59, Central Foreign Policy File, [no film number]. Confidential; Immediate. Drafted by Devine; cleared by Forester, Brookins, and Ganz; approved by Shlaudeman. Telegram 90161 is discussed in the source note to Document 378. Telegram 3961 from the Embassy in Venezuela, May 6, reported on Venezuela’s new economic nationalism measures. (National Archives, RG 59, Central Foreign Policy FIle, D740108–1006)
380. National Security Study Memorandum 203/Council on International Economic Policy Study Memorandum 35
Summary: The President directed a review of U.S. Government policy options towards Venezuela.
Source: National Archives, Nixon Presidential Materials, NSC Files, Box 365, Subject Files, National Security Study Memoranda, NSSMs. Confidential. In telegram 4420 from Caracas, May 16, the Embassy reported that Pérez announced the nationalization of foreign oil companies’ concessions and assets at no more than net book value. (Ibid., RG 59, Central Foreign Policy File, D740121–0763)
381. Telegram 126784 From the Department of State to the Embassy in Venezuela
Summary: The Department authorized the Ambassador to discuss with Pérez Venezuela’s expropriation of U.S. holdings and compensation for the expropriation.
Source: National Archives, RG 59, Central Foreign Policy File, D740154–0075. Confidential; Immediate; Limdis. Drafted by Ellis and Low; cleared by Ganz, Bond, Forrester, Membership of Expropriation Group, Kubisch, and Enders; approved by Sisco. In telegram 6500 from Caracas, July 13, McClintock reported on a discussion with Pérez regarding expropriation and the future of the oil industry. (Ibid., D740188–0412) Telegram 106608 to Caracas, May 21, instructed the Embassy to have an “early session” with President Perez. (Ibid., D740126–0867) In telegram 100872 to Caracas, May 15, the Department expressed concern regarding economic consequences of Perez’s policies. (Ibid., D740120–0956)
382. Telegram 145991 From the Department of State to the Embassy in Venezuela
Summary: Asserting that Venezuela’s recent oil price increase was unwarranted, the Department instructed the Ambassador to encourage the Venezuelans to lower oil prices so as to create conditions for continued economic growth in the international economy.
Source: National Archives, RG 59, Central Foreign Policy File, D740179–0492 Confidential; Immediate. Drafted by Creekmore; cleared by Katz, Bosworth, Shlaudeman, Devine, and McCullough; approved by Katz. On July 8, Shlaudeman and other Department officers, in a meeting with Rossi, emphasized U.S. Government concern over the higher price of oil and its negative impact on the U.S. public. (Telegram 148195 to Caracas, July 10; ibid., D740183–0429) On July 9, the Ambassador delivered his démarche to Schacht and informed the Department that the Foreign Minister would take the matter up with the President. (Telegram 6263 from Caracas, July 9; ibid., D740183–0003) Oil prices were among the subjects discussed when McClintock met with Pérez on July 13; Pérez expressed “satisfaction that after many, many years Venezuela was at last receiving a good price for its oil.” (Telegram 6500 from Caracas, July 13; ibid., D740188–0412) Telegram 5954 from the Embassy in Venezuela, July 1, reported the Venezuelan Government’s announcement that tax reference values will increase by 35 cents per barrel. (Ibid., D740174–0288)
383. Transcript of Secretary of State Kissinger’s Staff Meeting
Summary: Kubisch briefed Kissinger on economic nationalism in Venezuela.
Source: National Archives, RG 59, Transcripts of Kissinger Staff Meetings, Lot 78D443, Box 2. Secret; Nodis. Kissinger chaired the meeting, which was attended by all of the principal officers of the Department or their designated alternates.
384. Memorandum From the Chairman of the Interdepartmental Group for Inter-American Affairs (Kubisch) to the President’s Assistant for National Security Affairs (Kissinger) and the President’s Assistant for International Economic Affairs (Eberle)
Summary: Kubisch transmitted an NSC interdepartmental group’s review of U.S. policy towards Venezuela. The study focused on potential responses to Venezuelan economic nationalism.
Source: National Archives, Nixon Presidential Materials, NSC Institutional Files (H-Files), Box H–205, NSSM Files, NSSM 203. Confidential. The review was prepared as a response to NSSM 203/CIEPSM 35, June 10, published as Document 380. The annexes are attached but not printed.
385. Telegram 11246 From the Embassy in Venezuela to the Department of State
Summary: The Embassy recommended a frank but low-key dialogue with Venezuela, possibly combined with a high-level visit, to resolve investment disputes and to avoid the development of an adversarial relationship.
Source: National Archives, RG 59, Central Foreign Policy File, D740327–0708. Secret; Priority; Limdis. A summary of Pérez’s public letter to Ford is in telegram 9337 from Caracas, September 20. (Ibid., D740265–0417) The substance of the July 9 aide-mémoire that was said to have incensed President Pérez was laid out in Document 382. NSDM 257 is published in Foreign Relations, 1969–1976, vol. E–11, Part 1, Documents on Mexico, Cuba, and the Caribbean, Document 16. Portions of the July 26 study memorandum on U.S.–Venezuelan relations are published as Document 384. Telegram 10979 from Caracas, November 6, presented Embassy views regarding a proposed chief of mission conference in Washington, December 2–6. (Ibid., D740319–0637) Telegram 8738 from Caracas, September 5, presented the Embassy’s initial views regarding consultation among policy planning staffs in Venezuela. (Ibid., D740246–0604) In telegram 7221 from Quito, November 13, Ingersoll reported on Schacht’s suggestion that a special envoy be designated to study bilateral problems and prepare an agenda for discussions between the two countries. (Ibid., P850146–0852)
386. Telegram 11890 From the Embassy in Venezuela to the Department of State
Summary: McClintock assured Pérez that the U.S. Government did not have a “hard line” policy towards Venezuela.
Source: National Archives, RG 59, Central Foreign Policy File, D740349–0499. Secret; Limdis. In telegram 11830 from Caracas, November 29, the Embassy informed the Department that U.S. mining companies and the Venezuelan Government were near a settlement of a dispute over expropriated U.S. holdings. (Ibid., D740347–0799)
387. Telegram 13700 From the Department of State to the Embassy in Venezuela
Summary: Kissinger and Pérez Guerrero discussed the Trade Reform Act, producer-consumer communication on commodities, and U.S.-Venezuelan relations.
Source: National Archives, RG 59, Central Foreign Policy File, [no film number]. Confidential; Priority; Exdis. Drafted by Johnson; cleared by Divine and Rogers; approved by Ealum. A memorandum of conversation of the meeting is ibid., S/S–I Files, Lot 77D149, Principal Memoranda.
388. Telegram 23909 From the Department of State to the Embassy in Venezuela
Summary: Kissinger and Escovar discussed the Trade Bill, postponement of the Buenos Aires MFM, and the April OAS General Assembly.
Source: National Archives, RG 59, Central Foreign Policy File, [no film number]. Confidential; Priority; Exdis. The Senate Finance Committee’s mark-up of the Trade Reform Act included a provision for exclusion of OPEC members from the Generalized System of Preferences. (Telegram 10952 from Caracas, November 5, 1974; ibid.)
389. Telegram 2668 From the Embassy in Venezuela to the Department of State
Summary: McClintock recommended that the United States intensify bilateral dialogue with the Venezuelan Government in response to its campaign for regional leadership and a new economic order.
Source: National Archives, RG 59, Central Foreign Policy File, D750084–0084. Confidential. Repeated Priority to Buenos Aires.
390. Memorandum of Conversation
Summary: Kissinger and Escovar discussed the trade bill, Panama, the Paris producers-consumers conference, Cuba, and the OAS.
Source: National Archives, RG 59, Central Foreign Policy File, P820125–0215. Confidential; Nodis. Drafted by Sonandres. The conversation took place in the James Madison Room at the Department of State. On April 23, President Ford informed Pérez that Kissinger was cancelling a planned trip to Latin America because of the “tragic events in Indochina,” adding that he had asked Kissinger to give high priority to rescheduling the trip. (Telegram 93044 to Caracas; ibid., Central Foreign Policy File, [no film number]) Kissinger’s March 1 Houston speech is published in the Department of State Bulletin, March 24, 1975, pp. 361–368.
391. Telegram 118884 From the Department of State to the Embassy in Venezuela
Summary: The Department informed Shlaudeman of specific ways the U.S. Government intended to improve its relations with Venezuela.
Source: National Archives, RG 59, Central Foreign Policy File, D750178–0941. Confidential; Priority; Exdis. Drafted by Sonandres, Luers, and Devine; cleared by Einaui, Low, Hitchcock, Nieburg, Katz, Wood, and Einhorn; approved by Duemling. The April 4 memorandum of conversation between Luers, Einaudi, and Pérez in Caracas is ibid., P830117–1845. On April 21, Kissinger sent a letter to Escovar proposing the establishment of a mechanism for strengthening bilateral ties. (Telegram 91364 to Caracas; ibid., P850056–1619) On May 20, Escovar informed Shlaudeman that he thought agricultural development, nutrition, and fertilizer development were some of the areas the mechanism could address. (Telegram 5334 from Caracas, May 22; ibid., D750181–0133)
392. Telegram 6441 From the Embassy in Venezuela to the Department of State
Summary: President Pérez and Ambassador Shlaudeman discussed the impending nationalization of the private-sector petroleum companies operating in Venezuela.
Source: National Archives, RG 59, Central Foreign Policy File, D750218–0547. Confidential; Priority; Exdis. Article 5 of the prospective law to nationalize the petroleum industry in Venezuela would allow for mixed government-private enterprises (which could include foreign-based companies) after the nationalization had taken place. (Telegram 6030 from Caracas, June 11; ibid., D750204–0334) On August 29, 1975, Pérez signed a law nationalizing the assets of private-sector oil companies operating in Venezuela, and the next day he signed a law establishing a state-run company that would take full responsibility for the nation’s oil industry on January 1, 1976. (Telegram 9282 from Caracas, September 5, 1975; ibid., D750308–0367)
393. Telegram 214126 From the Department of State to the Embassy in Venezuela
Summary: Ford informed Pérez that he thought an OPEC oil price increase could damage the world economy, and he urged the Venezuelan President to attempt to convince the OPEC nations not to increase oil prices.
Source: National Archives, RG 59, Central Foreign Policy File, D750312–0063. Confidential; Immediate; Exdis. Drafted by Creekmore; cleared by Enders, Luers, and Sorenson; approved by Kissinger. Kissinger’s May 1 Kansas City speech is in the Department of State Bulletin, June 2, 1975, pp. 713–719. Kissinger’s May 26–28 speeches in Paris are in the Department of State Bulletin, June 23, 1975, pp. 837–844 and 849–855. On September 26, Springsteen, in a memorandum to Scowcroft, summarized Pérez’s September 23 response to Ford, in which he stated an increase in oil prices would not have a significant effect on the world economy. (Ford Library, National Security Adviser, Presidential Correspondence with Foreign Leaders, 1974–1977, Box 5, Venezuela, President Carlos Andrés Pérez)
394. Telegram 241105 From the Department of State to the Embassy in Venezuela
Summary: The Department instructed the Embassy to present the U.S. position on compensation for the expropriated assets of private oil producers.
Source: National Archives, RG 59, Central Foreign Policy File, D750351–0761. Secret; Immediate; Exdis. Drafted by Schwebel, Fishlow, Farer, and Hart; cleared by Ingersoll, Rogers, Enders, and Leigh; approved by Kissinger. Repeated to Jidda, Kuwait, and London. Ingersoll and Shlaudeman met on October 6; no record of the meeting has been found. (Memorandum from Rogers to Ingersoll, undated; ibid., ARA/NC Records, Lot 76D465, Petroleum Nationalization, Venezuela, 1975) In telegram 9518 from Caracas, September 11, the Embassy reported that in calculating the compensation due to expropriated oil companies the Venezuelan Government intended to deduct depreciation and amortization, workers’ benefits, debts to the Venezuelan Government, the value of oil extracted beyond each company’s assigned reservoirs, and the value of properties which the Ministry of Mines determined were subject to the 1971 Reversion Law. (Ibid., Central Foreign Policy File, D750315–0613) In telegram 10672 from Caracas, October 13, the Embassy reported that the Venezuelan Government made a formal offer of compensation. If the companies did not accept within 15 days, the Venezuelan Government would ask the Supreme Court to determine the amount of indemnification. (Ibid., D750355–0389)
395. Telegram 248521/Tosec 160064 From the Department of State to Secretary of State Kissinger
Summary: Shlaudeman informed the Department that he had delivered a démarche to Pérez on compensation for expropriated U.S. oil companies.
Source: National Archives, RG 59, Central Foreign Policy File, D750363–0152. Confidential; Priority; Exdis. Drafted and approved by Matteson. Kissinger was in China from October 19 to October 23. On October 28, all but two of the U.S. petroleum companies subject to the oil nationalization law accepted the Venezuelan Government’s compensation offer. (Telegram 11240 from Caracas, October 29; ibid., D750375–0513) The Venezuelan Government indemnified the expropriated companies approximately $1.03 billion. (Telegram 11992 from Caracas, November 19; ibid., D750403–0398) The Venezuelan Congress gave final approval to the compensation agreement on December 16. (Telegram 13199 from Caracas, December 18; ibid., D750441–1151) Telegram 241105 is published as Document 394.
396. Memorandum of Conversation
Summary: Kissinger and Pérez discussed regional issues, in particular Cuba and Panama.
Source: National Archives, RG 59, Central Foreign Policy File, P820117–0876. Confidential; Nodis. Drafted by Rogers; approved by Covey on March 8. The meeting took place at Pérez’s residence, La Casona. On February 16, Kissinger and Pérez discussed inter-American relations and Panama. (Ibid., P820117–0886) In a second February 17 conversation, they discussed oil, and Middle Eastern and Soviet politics. (Ibid., P820117–0990) Kissinger was in Caracas during a February 16–24 Latin American tour that included stops in Venezuela, Peru, Brazil, Colombia, Costa Rica, and Guatemala. Kissinger’s February 17 speech to the U.S.-Venezuelan Symposium II in Macuto, Venezuela, is printed in the Department of State Bulletin, March 15, 1976, pp. 313–321.
397. Telegram 2062 From the Embassy in Venezuela to Embassy in Brazil
Summary: Schlaudeman informed Kissinger that the United States and Venezuela had been unable to conclude a Foreign Military Sales agreement because of disagreement over a provision in the financing arrangements. The Ambassador added that Pérez wanted access to equipment in order to keep the officer corps content, and he suggested that a modest program of credits and training was in the national interest of the United States.
Source: National Archives, RG 59, Central Foreign Policy File, P840125–2528. Confidential; Immediate; Exdis. Repeated to Rio de Janeiro and the Department. Kissinger was in Brasilia on February 20 as part of his Latin American tour. On January 26, the Embassy informed the Department that if FMS to Venezuela were cut, the U.S. Government should reassure the Venezuelans that a lower level of military sales would not indicate declining interest in the maintenance of close relations with the Venezuelan armed forces. (Telegram 940 from Caracas, January 26; ibid., D760029–0849) No record of the reported February 17 Kissinger–Pérez discussion of the FMS issue has been found.
398. Memorandum of Conversation
Summary: Scowcroft, Low, Senator Robert Taft, and Edwin Dodd of Owens-Illinois, Inc., discussed the kidnapping an Owens-Illinois executive in Venezuela and the Venezuelan Government’s threat to expropriate the company’s holdings there after the company acceded to the kidnappers’ demands.
Source: Ford Library, National Security Adviser, Memoranda of Conversations, Box 19, April 8, 1976, Scowcroft, Senator Robert Taft, Edwin Dodd (Owens-Illinois). Confidential. The meeting took place in Scowcroft’s office. In telegram 2340 from Caracas, February 28, the Embassy reported on the February 27 kidnapping of Owens-Illinois managing directory William Niehous. (National Archives, RG 59, Central Foreign Policy File, D760075–0832) Niehous’s kidnappers demanded an increase in the wages of Owens-Illinois’ employees in Venezuela and the publication of their manifesto. (Telegram 3919 from Caracas, April 6; ibid., D760129–0599) On April 6, the Department informed the Embassy that Owens-Illinois complied with both demands, publishing the manifesto against the wishes of the Venezuelan Government. (Telegram 81910 to Caracas, April 6; ibid., [no film number]) In telegram 3976 from Caracas, April 7, the Embassy reported that Owens-Illinois representatives had been told by Venezuelan Government officials that the company’s assets would be nationalized. (Ibid., D760131–0469)
399. Action Memorandum From the Acting Assistant Secretary of State for Inter-American Affairs (Ryan) to Secretary of State Kissinger
Summary: Ryan laid out three options for Kissinger on providing direct FMS credits to Venezuela.
Source: National Archives, RG 59, Central Foreign Policy File, P840125–2520. Confidential. Sent through Maw. Drafted by Sonandres and Williams on June 3. Stern, Ganz, Lewis, Eisenhower, Crosswhite, and Lyle concurred. Kissinger approved Option 1. He wrote in the margin, “Send a letter to Pérez explaining decision.” Attached but not published are Tab 1, an undated suggested letter from Kissinger to the Foreign Minister; Tab 2, an undated suggested letter from Kissinger to Simon; and Tab 3, telegram 2062 from Caracas, February 20, published as Document 397. Kissinger’s letter to Pérez is in telegram 141194/Tosec 160171 from the Department to the Secretary’s Delegation in Mexico, June 10. (Ibid., D760222–0847)