Foreign Relations of the United States 1977–1980; Volume XV; Central America, 1977–1980

330. Memorandum of Conversation¹

Washington, September 9, 1977, 3:45 p.m.

SUBJECT

• President Carter/President Oduber, Costa Rica, Bilateral

PARTICIPANTS

• COSTA RICA

  • President Daniel Oduber
  • Foreign Minister Gonzalo Facio
  • Ambassador Rodolfo Silva

• US

  • President Carter
  • Secretary Vance
  • Assistant Secretary Todman
  • Ambassador Weissman
  • Mr. Pastor, NSC Staff

President Carter thanked President Oduber, “a leader of a strong democracy,” for coming to Washington at some personal inconvenience. He said that he believed we would have a difficult time securing ratification of the Panama Canal Treaty, making this week’s contact with U.S. senators most beneficial.

The President indicated to President Oduber that in addition to progress on the Treaty, this week had seen a major step forward in resolution of the conflict between Honduras and El Salvador with the ratification of the mediation agreement by the latter country on September 8. He pointed out also that meetings here had given Bolivia the opportunity to deal directly with the leaders of Peru and Chile on its aspirations for an outlet to the sea. He mentioned the opportunity the week’s program had given him to talk to leaders in the hemisphere generally of the sense of common purpose expressed at Tlatelolco.²

President Carter expressed his special thanks to President Oduber for having been so hospitable to Mrs. Carter during her recent visit, as well as to Ambassador Young, who had made his trip to Central America and the Caribbean thanks to the suggestion made to Mrs. Carter by President Oduber.³ President Carter referred to Ambassador Young as a “symbolic and sensitive leader” who understands the people whom he visits. He noted that Ambassador Young has just returned from South Africa with “some progress,” thanks to his persuasiveness.

The President recognized that he was a “latecomer” among leaders on human rights, since Costa Rica had endeavored for many years to heighten interest on this question. He stated that he was particularly pleased to associate himself with Costa Rica’s early initiative to improve the UN structure in this regard. He informed President Oduber that President Pinochet had indicated that he would be amenable to a small delegation of responsible people visiting Chile to examine human rights performance, if they did so without fanfare and would report first to him, President Pinochet, so that he could have an opportunity to comment on any allegations. President Carter also mentioned that President Videla of Argentina was concerned about his country’s loss of its fine past reputation because of human rights charges. While he did not deny that problems exist, President Videla believed that the matter could be resolved. President Carter concluded his discussion of human rights by noting that some other nations were not quite so forthcoming in his talks this week, but that progress exists and is certainly attributable in part to Costa Rica’s efforts.

The President then turned the discussion to the question of sugar, noting that this represented an area in which, perhaps, the two countries were not in complete agreement. The President mentioned the necessity for a multilateral approach, pointing out that if an international sugar agreement is not forthcoming, U.S. legislation will require the setting of a support price at about the 13½¢ per pound level.

President Oduber responded that there had to be international agreements between producing and consuming countries not only on sugar, but coffee and cacao as well, extending later, perhaps, to cotton. He added that he believes both floor and ceiling prices must be established in such agreements to avoid huge profits falling to certain interests, at the expense of both producers and consumers. In this regard, he mentioned the recent efforts of the Latin American countries in Mexico to join together on coffee, preliminary to talks with the Africans. He pointed out that ex-President Figueres had floated the idea of stockpiles as early as 1950 in a meeting in New Delhi. He referred to the saying in Spanish that “perfection is the enemy of the good,” noting that every time an agreement appeared to be prospering, somebody found it not to be perfect enough. President Oduber also raised the question of duties on sugar, noting his happiness that Costa Rica had been favored with GSP treatment benefitting her exports by 1.875¢ per pound, but that now he was worried by the additional 4¢ per pound, from which Costa Rica, he hoped, would be exempt.

President Oduber then turned to the more general problem which Costa Rica has as a result of the Lome convention⁴ which is discriminatory since its agriculture is mostly tropical and competes mainly with those countries most favored by that agreement. He also mentioned the subsidy to Cuba represented by the Soviet Union’s purchase of sugar at high prices and the sale of petroleum at low ones, in addition to direct financial help, concluding that COMECON countries and the ex-colonies both get special treatment on trade, but that Latin America is the only “unprotected” area in the third world.

Observing that Costa Rica, in spite of this, has managed to show that social justice can be achieved with respect for human rights, so meeting the Cuban challenge, President Oduber stated his hope that the U.S. Executive Branch would maintain an ability to favor countries that are behaving well on human rights and provide special treatment or incentives. He emphasized that he was referring to simple, subtle discrimination in their favor. He illustrated the problem by referring to the fact that Costa Rica’s exports of meat represented a very miniscule part of total U.S. consumption, and that an additional 10 million pounds a year in its voluntary restraint level would mean more progress for Costa Rica and more stability. Costa Rica has attempted to expand its markets in the Caribbean but has been met with “back door” maneuvers by the Australians to lower prices, taking advantage of Commonwealth arrangements. President Oduber concluded by noting that Costa Rica has entered U.S. markets slowly, with minimal effects on U.S. industry and U.S. labor.

Returning to the human rights relationship, President Oduber commented that the “winds have changed 180 degrees in Latin America in recent months, thanks to President Carter’s efforts on human rights,” and that further progress might well come from selecting one or two countries with exemplary records to favor them with simple, subtle, special treatment on trade matters. President Oduber indicated that he believes that the rest of the countries would understand this quickly and make the task much easier for him in persuading other Central American countries to improve their records.

President Oduber summed up the trade discussion by stating that Costa Rica is all for international agreements on commodities and understands the desirability of global arrangements. However, until 160 nations could be convinced of the need for this, he hoped that Costa Rica could be helped directly. He stated that respect for the accomplishments of U.S. agriculture had convinced Costa Rica to copy U.S. agriculture, but tropical agriculture is more difficult. President Carter replied that when he had visited “Don Pepe’s” ranch on his visit to Costa Rica, he had enjoyed the ex-president’s explanation of Costa Rican agriculture. President Oduber replied that Figueres was well informed on this subject.

President Carter concluded this segment of the meeting indicating that there was great inflexibility in U.S. legislation and that ours were the best politically-organized farmers in the world, working very hard to preserve their rights. As for sugar, he noted that we are both large producers and large consumers and that fluctations in prices have been “devastating.”

President Carter then turned the discussion to a subject he introduced as “a somewhat sensitive problem for us”, that of Mr. Robert Vesco, “a fugitive from U.S. justice who had defrauded many people.”⁵ President Carter solicited President Oduber’s frank view as to what could be done to bring him back to the U.S. so that he could be tried, recognizing that Costa Rica has legislation which affects this possibility.

President Oduber stated that he and his cabinet had resolved two months ago to ask Mr. Vesco to leave the country, but that he has been “indicted” by two tribunals in Costa Rica, so preventing his departure. The Costa Rican President noted that his government was applying “careful pressure” to push for an early resolution of the outstanding cases. He stated that Mr. Vesco “should not be in Costa Rica when national elections take place on February 5, 1978, and hoped that he would not be.”

President Oduber then reviewed the history of Mr. Vesco’s investments in ex-President Figueres’ firms. He added his view that the U.S. extradition effort in 1973 was badly prepared and that he had commented publicly that it appeared to have been done in such a way “as to not get Mr. Vesco out of Costa Rica.” He noted that the problem was a difficult one for him as ex-President Figueres was “our political father at the beginning of this administration.” Nevertheless, he indicated his administration had worked slowly to make extradition easier, and this legislation has existed since last October. Foreign Minister Facio commented that extradition would depend on the Costa Rican courts in light of the current domestic cases. He also expressed his agreement with President Oduber that the previous petition for extradition “on the face of it could not prosper.”

President Oduber added that Mr. Vesco was “not nice natured,” but that he was now subject increasingly to “government orders, advice, and regulation” and that he is getting out of investments in real estate and government bonds, and otherwise generally has gotten his money out of Costa Rica, with the exception of $5 million tied up in Figueres’ interests and one newspaper, from which President Oduber hopes he will soon be eliminated.

President Carter then turned to Secretary Vance to ask the status of the prospective performance by the Costa Rican youth symphony at the White House. At the Secretary’s request, Mr. Pastor replied, stated that the October date appeared to be a difficult one for reasons having to do with obtaining financing. He said that, an April, 1978 performance would be more suitable, and asked whether that result would be agreeable with President Oduber. Minister Facio and President Oduber quickly agreed that a postponement would be most helpful. President Oduber promised to talk personally with several corporations to help arrange financing necessary to bring them to the U.S. next spring. President Carter thanked President Oduber for freeing him of a matter of “considerable conversation with my wife.”

President Oduber noted that Costa Rica had arranged for a $1 million loan for musical instruments for its youth, “a better investment than rifles.” President Carter took the opportunity to compliment President Oduber on having worked so hard to achieve a better life for his people.

President Carter then mentioned his awareness of Costa Rican interest in securing patrol boats from the U.S. President Oduber stated that having no army, Costa Rica may not appear to be eligible for help, but that he believed a credit for this purpose was justified to deal with problems of smuggling, both of drugs and weapons. He explained to President Carter that Costa Rica “is a country of exiles” some of whom wish to invade their former countries, and so they seek illegal weapons. Additionally, he noted that Costa Rica lacked a current capability to conduct search and rescue operations.

Secretary Vance indicated that he believed the U.S. government could work out an FMS credit for this purpose, and that the State Department has been checking out this matter. Ambassador Silva said that he hoped that Costa Rica “would not be penalized for not having an army,” and Secretary Vance repeated that he thought FMS credits could be obtained.

President Carter again thanked President Oduber for his presence in Washington. The latter replied that he had talked with Senator Case the previous day and had pointed out that “fresh winds of freedom” are again being felt of a kind that have not been present since the Kennedy struggle against dictators. Today’s autocratic regimes are more sophisticated and harder than then, he observed, using Castro as an excuse though he didn’t represent a true threat. Rather, President Oduber pointed out, no military government is either efficient or could control Castro. Costa Rica, on the other hand, has met the Castro threat by freedom and sees today no more Communist strength in its votes than the party had 40 years ago. President Oduber mentioned that he has been eager to help on the problems not only of Panama, but also of Haiti and the entire Caribbean, and that Costa Rica’s response to the threat of Castro is to demonstrate to Costa Rican youth what can be achieved by democracy.

President Carter asked what President Oduber thought would be the reaction to our normalizing relationships with Cuba over a three to four year period. He replied that Costa Rica would be happy to see this occur, since it would dispose of the myth now entertained by students and remove the pretext for supporting Castro, since a normal state of relations would leave Castro as “just another dictator.” President Carter inquired whether Costa Rica maintained an office in Havana, to which President Oduber replied only a Consulate General. He has been thinking of establishing full relationships, but said he would wait for the outcome of the Presidential elections in February, 1978, before doing anything about it.

1. Source: Carter Library, National Security Affairs, Staff Material, North/South, Pastor Files, Country Files, Box 33, Costa Rica: 2–12/77. Confidential. The meeting took place at the White House. Drafted by Weissman. Oduber was in Washington for the ceremonial signing of the Panama Canal Treaties by Carter and Torrijos on September 7. The Treaties guaranteed that Panama would assume control over the Canal by the end of 1999.
2. Reference is to the Treaty of Tlatelolco, signed in Mexico City in 1967, which sought to make Latin America a nuclear free zone. See Foreign Relations, 1964–1968, vol. XI, Arms Control and Disarmament, Document 226.
3. Rosalynn Carter met with Oduber in San José on May 31 and discussed a range of issues including human rights, trade policy, and political refugees in Costa Rica. During the meeting, Oduber suggested that Young be sent to visit Caribbean countries. (Telegram 3606 from Quito, June 2; Carter Library, National Security Affairs, Brzezinski Material, Brzezinski Office File, Country Chron File, Box 7, Costa Rica, 1977)
4. First signed in February 1975 in Lomé, Togo, the Lomé Convention was a trade agreement between the European Economic Community and African, Caribbean, and Pacific countries.
5. Vesco, a financier, fled the United States for Costa Rica in 1973 in order to avoid criminal prosecution; see Document 109 in Foreign Relations, vol. E–11, Part I, Documents on Mexico; Central America; and the Caribbean, 1973–1976. Vesco faced five indictments brought between 1972 and 1976 in the U.S. District Court for the South District of New York. His presence in Costa Rica and his alleged ties to Oduber became a major issue in the Costa Rican Presidential elections of February 1978, won by Carazo. Vesco departed Costa Rica for the Bahamas in May 1978.