273. Memorandum of Conversation1


  • President Carter/President Poveda Bilateral



    • Vice Admiral Alfredo Poveda Burbano President of the Supreme Council
    • Foreign Minister Jose Ayala Lasso
    • Ambassador Gustavo Ycaza Borja (US)
    • Galo Montano, Minister of Industries and Commerce
    • Rafael Cevallos (Aide)
    • Felipe Valladares (Aide)
  • US

    • President Carter
    • Secretary Vance
    • Dr. Zbigniew Brzezinski
    • Assistant Secretary Todman
    • Ambassador Richard Bloomfield
    • Robert Pasto, NSC

President Carter thanked Admiral Poveda for having accepted his invitation to Washington and for supporting the Panama Canal Treaty. He also thanked the Admiral for the hospitality shown by the GOE to Mrs. Carter during her recent visit. He said that she had learned a great deal and had reported fully to him. The President said that Mrs. Carter had helped him prepare for his visit with President Morales Bermudez of Peru and that he had expressed to the Peruvian President the Ecuadoreans’ concerns regarding Peruvian arms purchases.2 President Morales Bermudez had told President Carter that Peru’s acquisition of arms had been completed and that from now on they would only be purchasing spare parts. President Carter told President Poveda that he hoped that President Morales Bermudez would give the same assurance directly to Ecuador and that Ecuador’s concerns would be alleviated.

Admiral Poveda expressed his appreciation for the opportunity to meet with President Carter. He said that his government appreciated Mrs. Carter’s visit to Ecuador. She had won the affection and esteem of all Ecuadoreans. He said that it was evident that she had kept her promise, which was to inform her husband of Ecuador’s concerns.

Admiral Poveda congratulated President Carter on signing the Panama Canal Treaty, which he characterized as the beginning of a new era in hemispheric relations. He pointed out that most of the Latin [Page 793] American Presidents assembled in Washington had taken advantage of the opportunity to have bilaterals with each other, and that the Canal Treaty had served as an example of the way in which problems should be solved not only between the US and the Latin American countries, but also within Latin America.

The Andean Region

After a brief reference to the “troubled” Caribbean, President Poveda discussed the situation in the Andean region. He had talked the previous day with the President of Peru and they had analyzed all the issues between the two countries, including those of an “historical nature”. They had instructed their Foreign Ministers to continue these discussions and the two Presidents would meet periodically. In this way Ecuador hoped to arrive at a solution in a few years to its longstanding territorial problem with Peru. Admiral Poveda expressed his appreciation to President Carter for the fact that he had talked in such a clear manner to President Morales Bermudez. This undoubtedly served as an incentive to Morales Bermudez to agree to the bilateral discussions of territorial problems.

National Security

Admiral Poveda then passed to the theme of national security. He said Ecuadoreans were a pacific people. Ecuador had never started a conflict, and did not want war. This was in spite of having lost at least 70% of its original territory. The Rio Protocol of 1942 had reduced Ecuador’s territory by 50%.3 Although this loss had seriously affected the morale of its people, Ecuador has never attempted to arm for the sake of revenge. Instead it has tried to work out its aspirations through the strengthening of international principles of justice.

Arms Requests

Admiral Poveda said that he wanted to ask President Carter to help Ecuador achieve equilibrium in the region, and thereby make for a more stable security situation. Ecuador’s first priority was antiaircraft defense. The Department of State had told the GOE that the Hawk missile was not possible but had indicated, without any commitment, that it would entertain a request for a less sophisticated missile, the Vulcan/Chapparal. Also it would be helpful if the USG could accelerate its deliveries of equipment already purchased by the Army. There was great goodwill on the part of US agencies to provide equipment, but in some cases the delivery times were quite long. As for the Navy it [Page 794] is quite pleased with the cooperation it has been receiving including the recently concluded UNITAS maneuvers. Its only additional request is for another destroyer, this time on a “hot-ship” basis.4

GSP Exclusion

Admiral Poveda then passed to the subject of economic development. He said that the Government was trying to help its people achieve a better life by investing its small income from petroleum exports. With this new capital, the GOE had built industrial plants, ports, highways, and had made some progress, although not enough, in agriculture. It was changing its petroleum laws in order to improve incentives for foreign investors. Ecuador now enjoys a satisfactory level of foreign exchange reserves, a relatively moderate rate of inflation, and a firm currency. The GOE wants its people to participate economically and politically in the life of the country. He referred to the government’s efforts in health and education. He pointed out that it had kept its international commitments both with governments and with foreign companies. He said that because of Ecuador’s desire to increase its foreign trade, the provision in the US Trade Act which excluded Venezuela and Ecuador from tariff preferences was a serious matter for the Ecuadoreans.5 He asked for President Carter’s goodwill to try to overcome the impasse in this matter, although he realized it depended on the Congress.

Access to Soft Loans

Finally, Poveda pointed out that when a country acquires some oil production it is automatically classified as rich. But Ecuador is far from rich. It needs access to the soft loans of the international agencies. Here Ecuador had run into some opposition. The amount of loans currently pending was not large—about $70 million in total, but these go to important social projects and he would appreciate it if the US Government could evaluate Ecuador’s true economic situation when it considered these loans.

President Carter asked for more details and President Poveda said that there were four projects pending in the Inter-American Development Bank each one averaging about $12 million plus one for about $18 million.

President Carter then replied to the points made by President Poveda.

[Page 795]

Economic Issues

With regard to the soft loans from the IDB, he said that he certainly believed that the US would give its support for those loans. On the GSP exclusion, this law was passed by the Congress following the quadrupling of oil prices. He would like Congress to give him the discretionary authority to remove these restrictions as he saw fit in the best interest of the United States. He said obviously Ecuador and Venezuela did not deserve to be included in the ban because they had supplied the US with oil during the Arab embargo. Changing the law, however, would be difficult because Congress was reluctant to distinguish between various members of OPEC. Also, we now have good relations with many of the Arab states. The President said he could not guarantee success, but it was a goal of his Administration to get the OPEC exclusion removed, and we will continue to pursue it.

A Statement on GSP

The President then turned to Secretary Vance and after a minute of conversation said that he had asked the Secretary about the advisability of issuing a statement regarding his conviction that the GSP exclusion provision was unfair. This might help people understand that he was personally concerned and might have a good effect on Congress. However, he should discuss this matter with the Special Trade Representative, Mr. Strauss, before deciding whether to issue such a declaration.

Ecuador’s Arms Requests

Turning to Ecuador’s requests for defensive weapons, the President said that he would like to expedite the delivery of the antitank weapons already sold to the army. He said that he was glad that the USG had been able to deliver an LST and a destroyer. He thought that there would be no problem with the Vulcan/Chapparal as far as our arms policy was concerned. He said that he would have the Department of Defense look into it. Regarding Ecuador’s request for a second destroyer he said he was not familiar with the “HOTCHKISS” (sic) class of destroyers, but he did not think such a destroyer would be in violation of our arms policies.

The President said we are trying hard by ourselves, and with the cooperation of other countries, including the Soviet Union, to halt the spread of arms. This was a difficult task, but the arms that Ecuador had asked for struck him as being purely defensive. He promised to give Poveda a report on these requests.

Fishing Dispute

President Carter then expressed his admiration and appreciation to Poveda for the fact that the two countries had not had any problems [Page 796] regarding the fishing dispute in recent years. He said he understood this was in part due to Poveda’s leadership. If the problem arose in the future he would appreciate Poveda contacting him directly if necessary in order to avoid any incident. The US did not wish to abuse its access to this resource.

Human Rights

The President said that he was pleased with the progress being made in Latin America on the human rights issue. He thanked Ecuador for its support of the US resolution at the OAS meeting in Grenada.6 This demonstrated that our peoples shared the same principles.

The President said that the US was looking with great interest on Ecuador’s election plans which were a great example to the rest of the world.

Access to the Amazon

President Carter told Admiral Poveda that he had expressed to President Morales Bermudez an interest in Ecuador’s desire for access to the Amazon River system. He had not quite understood Morales Bermudez’ reply which was that there was a possibility of settlement within the context of Article 6 of the Rio Protocol. Morales Bermudez had said Peru was awaiting an initiative on Ecuador’s part within that framework. Maybe this information was not of significance to Ecuador. If he, President Carter, could be helpful by speaking further to Morales Bermudez to facilitate discussions on this problem, he would do so, but he preferred that the two countries deal with the matter directly.

Admiral Poveda then undertook to reply to the two points made by the President.

Ecuador’s Return to Democracy

He said the problem in Ecuador for years had been one of permanent political instability, with the Government alternating between civilian and military regimes. In this process, political parties had almost ceased to exist. Therefore, when his Government took office it undertook to develop a plan for restructuring the political life of the country. The objectives of this plan were twofold, first to unify all Ecuadoreans and second to create new large political parties which would have broad-based support. His government believed that the process had now been accepted by the people and by the political parties, to which the government was giving direct economic and moral support. Also, since the military were now actively promoting a restructuring of the political system, there should be a permanent equilibrium [Page 797] among the various political forces in the country in the future. It was hoped that stronger political parties would serve as a check on those exercising power. Two constitutions had already been drafted and would be presented to the people in a referendum, possibly in January. However, the Government intended to go about this deliberately in order to be sure that the people’s political interests had been reawakened. After the referendum there would be the electoral campaign.

Article 6 Not Acceptable

Regarding the question of access to the Amazon, Ecuador’s aspiration was to have a sovereign access, not, as Article 6 of the Rio Protocol provided, merely the right of free transit leading to the Amazon. Ecuador was not interested in simply having the Peruvians’ permission to pass their customs houses to get to the river.

President Carter said he presumed there was no possibility of an exchange of territory. Admiral Poveda smiled and said that Ecuador believed it had already given “its quota” of territory to Peru. President Carter asked if he had discussed this matter with Morales Bermudez. President Poveda said yes, and they had agreed to continue discussions of it through their Foreign Ministries. He was hopeful that this would bring results and he was grateful for President Carter’s assistance in getting this process going.

President Carter said that he would reemphasize his interest to Morales Bermudez. He said of course he had no way of forcing Peru to work toward any solution but that he would make it clearer to Peru that he felt that such discussions would contribute to peace in the area. President Carter inquired what territory was involved and what rivers would be involved in a settlement.

Admiral Poveda said that Morales Bermudez and he had only agreed on certain general principles, and that there was not yet a concrete proposal. There was the possibility that a settlement could be reached on the basis that the border which had been defined under the Rio Protocol could not be completely drawn because of a geographical accident [here he was referring to the discovery of the Rio Cenepa subsequent to the Rio Protocol].7 It might be possible to give Ecuador sovereign access in view of the inoperability of the Rio Protocol in this particular area. Poveda said that once the discussions reached a more concrete stage he would inform President Carter and he was confident Ecuador’s proposal would merit the support of the President.

President Carter closed the meeting by stating that he had thoroughly enjoyed meeting Admiral Poveda and that he felt the conversa [Page 798] tions had been most useful. He then quipped that he was gratified to see Naval officers in high political positions and reminded the Admiral there was a long tradition, beginning with President Roosevelt, of ex-Naval officers in the White House.

Admiral Poveda expressed his appreciation for the meeting and invited President Carter in the name of the Supreme Council to visit Ecuador at any time he desired.

  1. Source: Carter Library, National Security Affairs, Staff Material, North/South, Pastor, Country Files, Box 19, Ecuador, 2-12/77. Confidential. The meeting took place in the White House Cabinet Room. Drafted by Bloomfield.
  2. See Document 304.
  3. For the text of the Rio de Janeiro Protocol of 1942, see the Department of State Bulletin, February 28, 1942, pp. 194–196.
  4. This was translated as a “HOTCHKISS” type. [Footnote is in the original. A “hot ship” transfer is one in which a U.S. ship is transferred immediately to a foreign navy upon its decommissioning, never becoming inactive.]
  5. See footnote 4, Document 268.
  6. See Document 20. The OAS General Assembly met in Grenada June 14–24.
  7. Brackets are in the original