Foreign Relations of the United States, 1955–1957, Western Europe and Canada, Volume XXVII

197. Memorandum of a Conversation, Department of State, Washington, April 10, 1956¹

Washington, April 10, 1956

SUBJECT

• 1953 Base Facilities Agreement and Related Economic and Military Aid Programs

PARTICIPANTS

• Americans
  • The Secretary
  • The Hon. John Davis Lodge, U.S. Ambassador to Spain
  • Mr. Robert D. Murphy,G
  • Mr. Livingston T. Merchant,EUR
  • Mr. John Wesley Jones,WE
• Spanish
  • Don Alberto Martin Artajo, Minister of Foreign Affairs
  • Don José M de Areilza, Spanish Ambassador
  • D. Juan de las Barcenas, Director General of Foreign Policy
  • D. Aurelio Valls, Press Section, Foreign Ministry (acted as Interpreter)

The Minister of Foreign Affairs called on the Secretary this morning accompanied by his Director General of Foreign Policy, Juan de las Barcenas, and by the Spanish Ambassador. Señor Valls, another Foreign Ministry Official accompanying the Minister, acted as interpreter for the meeting. Following an exchange of greetings the Foreign Minister, in referring to the Secretary’s conversation with him and General FRANCO in Madrid last November, recalled that several of the political prognostications which had been made at that time had since been confirmed. One of these was Spanish entry into the United Nations which the Minister acknowledged was largely due to the efforts of the United States.

In response to the Secretary’s request the Minister said that he would like to open the conversations this morning with the subject of the base facilities agreement of 1953 and related accords. He said that the Agreements had been carried out loyally on both sides but within a period of three years the framework in which they were drafted had been somewhat altered. For example, the danger to Spanish cities, through the two-fold development of nearby air bases and the improvement of nuclear weapons by the Russians had been increased. While some willingness to minimize the continued threat of the Soviet Union was apparent in Europe, and even in certain portions of America, the unflinching anti-Communist position of Spain had not changed.

The base agreement signed with the United States in 1953 might be considered in two distinct phases: one: the acquiring of military facilities for the use of the United States air and naval forces. This phase had proceeded to the satisfaction of both sides. A second phase might be envisaged as the strengthening of the Spanish military forces. The United States should know that it can count on the Spanish armed forces in an emergency. The Minister recalled that the Nationalist Government had mobilized 1,200,000 men in the Spanish civil war and almost as large a number was enrolled by the opposing force. The morale in the present Spanish army is excellent and there is practically no Communist infiltration therein. The Minister regretted that this splendid human quality of the Spanish armed forces was not matched by technical facilities and maintenance equipment. The entire Spanish defense establishment cost 37 percent of the present national budget. This was already too much for a poor country and for obvious political reasons it could not be increased. If it were desirable to strengthen the Spanish military forces on the technical and equipment side, the increased cost would have to be borne by other than Spanish shoulders. Spanish military experts were of the opinion that an increased military program could be adopted within the framework of the present agreements “on the Italian model”.

The Minister concluded his remarks on this subject by saying that there was a great deal of speculation in the press about Spanish membership in NATO. He added, laughingly, that the press seemed to be more interested in the prospect than the Spaniards. Spain would, of course, be willing to join NATO if and when this seemed feasible. However, the Spanish Government believed that the present agreements with the U.S. provided a satisfactory arrangement for the common defense if Spain could enjoy equal treatment with NATO in U.S. military aid programs and in receiving classified information. The Secretary replied, and Mr. Merchant confirmed, that our relationship with Spain in the military field compared favorably with that of many of our various NATO allies.

Turning to the economic aid program the Minister said that this had been designed to strengthen the economic base of the country and that a great deal had been done in this respect. The Spaniards were extremely grateful for the economic assistance which they had already received from the United States Government which had, in fact, greatly aided and improved the Spanish economy. However, without seeming to be ungrateful the Minister felt that more needed to be done in this field and went on to say that the Spanish Ministers of Agriculture and Industry had developed specific plans for the further development of areas of the Spanish economy such as agriculture (irrigation and fertilizers) and industry.

With respect to current U.S. economic aid programs the Minister ventured, without seeming to be ungrateful, the suggestion that the Spaniards would like to see a greater portion devoted to capital goods and less to surplus agriculture commodities. He referred to a peseta balance of 2,200,000,000 pesetas which had been built up in the Spanish bank from counterpart and from the sale of surplus agriculture commodities. The second suggestion was that this huge accumulation might well be used for investment in Spanish economic development projects. (Sr. Barcenas later explained to Mr. Jones that what the Minister meant to propose at this point was that a greater proportion of the counterpart than the present 30 percent proceeds from the defense support program be made available, from the accumulation of pesetas in the banks, for Spanish economic development projects.) At this point Ambassador Lodge interrupted to say that just before he left, the director of USOM, Madrid, had drawn a large check on these funds for agreed U.S.-Spanish projects. The Minister in reiterating his belief that the present agreements are being implemented in a satisfactory manner again emphasized the desirability of strengthening the Spanish military and economic potential. He added that General Longoria, representing all three of the Spanish Defense Ministries and Chiefs of staff, and Senor Rovira, directly responsible for the coordination of the U.S. economic aid program in Spain, are both here in Washington and available for conversations in more detail with appropriate officials of the United States Government.

The Secretary, in replying to various points raised by the Foreign Minister, agreed that the dangers of military aggression were a constant threat to Spain and the rest of the free world. However, he went on to say that those countries which build up their military forces and military facilities as a deterrent to Soviet aggression are in fact protecting themselves and contributing to international peace. The United States appreciates the high character of statesmanship in those countries which develop a deterrent power as a prevention to the outbreak of war. The Secretary recalled the Minister’s reference to the role of the Spanish armed forces in the event of an emergency and in this regard informed the Minister that the United States would be happy, if the Spanish Government so desired, to send a small U.S. military mission to Madrid to discuss this problem. This subject, he added might be more appropriately discussed between the representative of the Spanish Defense Ministries, General Longoria, and Admiral Radford when they meet.

Regarding our military aid program the Secretary reported that while substantial amounts of U.S. funds had already been authorized by the Congress for this purpose a considerable percentage of them had not yet been disbursed. For example, for fiscal years 1954, 1955, and 1956 a total of somewhat more than $300 million had been authorized but that less than $100 million had actually been disbursed. Consequently there was a sizeable portion of the present military aid program which was yet to be delivered. Furthermore, it would appear that any increased military program for Spain would demand as much on the ability of the Spanish economy to carry this increased burden as on U.S. ability to furnish the end items. With respect to our economic aid program the Secretary noted that $220 million worth of funds had already been authorized exclusive of the PL 480 program which amounted to something over $100 million. Of these two programs a total of only $146 million approximately had thus far been disbursed leaving a total of approximately $174 million worth of goods yet to be delivered. With reference to the economic aid program for fiscal year 1957, which was still before Congress and concerning which no specific commitment could be made, it was the Secretary’s understanding that the major portion of the funds earmarked for Spain were non-agriculture. However, he suggested that the Minister seek an appointment with Mr. Hollister, the director of ICA, and in that conversation he could emphasize Spanish need for capital goods. The Minister agreed to this suggestion and asked that the Secretary inform Mr. Hollister, before their meeting, of the substance of this conversation this morning on the economic aid program.

The Minister expressed his gratitude and that of the Spanish people to the President and to the American Government for its initiative in coming to the relief of Spain following the prolonged frost this past winter which had damaged so severely the traditionally large olive and orange crops. The Minister estimated a loss of $100 million in foreign exchange to Spain as a result thereof. The Secretary recalled that Spain had responded generously to the floods in New England last year and told the Minister he wished to reciprocate the thanks and appreciation of the American people for this Spanish gesture of friendship and cooperation.

1. Source: Department of State, Central Files, 711.56352/4–1456. Confidential. Drafted by Jones.