353. Memorandum From the President’s Assistant for National Security Affairs (Brzezinski) to President Carter1

SUBJECT

  • Cooperation for Caribbean Development

In the light of Mrs. Carter’s trip to Jamaica, Andy Young’s mission to ten Caribbean basin countries, and a speech by Assistant Secretary of State Todman to the House International Relations Committee,2 there is a need, and there are expectations at home and abroad, for the U.S. to come forward with a general strategy for approaching the economic problems of the Caribbean. The bilaterals offer the opportunity to take this recognized need for an overall approach to the Caribbean another step toward a real program.

Broadly, there are two kinds of economic problems facing the countries of the Caribbean: short-term financial stabilization and long-term economic development. The countries with the most difficult short-term problems are Jamaica and Guyana, and the consensus is that these problems are most effectively addressed by the IMF . At times, we may want to consider supplementing IMF funds, as we, in effect, did in Jamaica, but these decisions need not be a part of the overall package.

The renewed interest in the Caribbean area has not eliminated the differences among the various countries as to how such cooperation should be organized, or and on what problems efforts should focus. In June, Perez told you that he thought the Caribbean Development Bank should be the principal mechanism for Caribbean development.3 More recently, he mentioned to Andy Young that he thought the Inter-American Development Bank (IDB) should assume a leadership role. Trinidad and Tobago fear that use of the IDB would tend to strengthen the role of the Spanish-speaking countries; they prefer instead IMF leadership, which would imply stricter conditions on lending and greater discipline by recipient countries such as Jamaica and Guyana.

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In preparation for bilateral consultations, we requested a decision memorandum from State providing options on the nature and the magnitude of the effort which the U.S. might consider in assisting in the Caribbean’s development. The result is attached at Tab A.4

NSC has discussed the paper with Treasury and OMB officials, and we conclude that the United States should not make specific commitments on increases in aid levels at this time. But we need your guidance on the ways that the United States, in coordination with other potential donors and in consultation with the Caribbean countries, should define and implement a strategy for Caribbean development. There are three issues which will arise in the bilaterals which need resolution:

1. To be most effective, it is understood that our effort should be part of a much more comprehensive approach, involving many other donor countries (possibly including U.S., Canada, Venezuela, Trinidad and Tobago, Costa Rica, Colombia, Mexico, England, France and Netherlands) and institutions, and directed at assisting all the island states of the Caribbean, plus Guyana, Surinam, and at some point, perhaps Belize. The US approach should encourage closer cooperation among donors, a better focus on key problems, and better use of funds by recipients. It should promote closer integration among the English-speaking countries, closer collaboration between them and such other countries as Haiti and the Dominican Republic, and closer cooperation between them and countries such as Venezuela, Costa Rica, Mexico, the U.S. and Canada.5

2. The size of the US development assistance effort

The United States should indicate its willingness to consider an increase in the amount of its assistance to the Caribbean within the context of a burden-sharing formula involving other donor countries. Specific amounts and the balance between bilateral and multilateral programs can be resolved after consultations among donors and recipients.6

3. Joint determination of development assistance programs

Andy Young’s trip led him to conclude that the first step in initiating a comprehensive approach would be to call an expert-level meeting to determine the economic problems on which cooperative efforts [Page 876] should focus and how donors and recipients could best cooperate to ensure a comprehensive assault on such problems.

To develop better understanding of the problems of the area and how we can best approach them collectively, the U.S. favors a meeting of governmental and non-governmental experts of representative countries of the area (to include perhaps Jamaica, Trinidad and Tobago, Venezuela, Costa Rica, the U.S. and Canada). The meeting could be held at the World Bank, and be co-sponsored by the Bank, the Inter-American Development Bank and the Caribbean Development Bank. The venue would not imply that the World Bank would lead a consortium which might emerge from this meeting. The meeting itself would determine how to proceed subsequently. There will be no prior commitment to any particular institutional arrangement. Such a meeting should take place before the end of this year.7

  1. Source: Carter Library, National Security Affairs, Staff Material, Office, Presidential Advisory File, Box 71, Folder: Latin America Box 1. Confidential. Sent for action. Although Brzezinski did not initial the memorandum, Carter did, indicating that he saw it.
  2. Regarding the First Lady’s trip to Jamaica, see Document 178. Young visited 10 Caribbean nations from August 5 to August 17. During his testimony before a subcommittee of the House International Relations Committee on June 28, Todman requested more resources for the Caribbean. (Telegram 1844 from Port of Spain, June 30; National Archives, RG 59, Central Foreign Policy File, D770234–0237)
  3. See footnote 2, Document 180.
  4. Attached but not printed is an unsigned decision memorandum, which recommended $125 million in regional assistance to the Caribbean for FY 1979. Also attached is an undated memorandum from Gilligan to Vance on assistance to the Caribbean and Latin America.
  5. The President checked the approve option.
  6. The President checked the approve option.
  7. The President checked the approve option.