613. Memorandum From Secretary of State Rogers to President Nixon1 2
Subject:
- Review of Peru Policy
A comprehensive review of the Peruvian situation on January 7, 1970, by the senior officials of the Department with me resulted in the conclusion that we should maintain for the next few months our current policies of deferring the application of the Hickenlooper Amendments and of maintaining non-overt economic pressures on Peru.
With respect to the Hickenlooper Amendments, we concluded that, in the Peruvian context, revision of the Amendments to provide Presidential discretion in their application would serve our objectives. I have decided, however, to withhold a recommendation to you on the initiation of consultations with the Congress until the report of the Peterson Task Force, which I believe will address this question, is available. I sense no significant pressure for application of the Amendments. On the contrary, I believe that there is a general public and Congressional acceptance of our present position of deferral. If, against my expectation, this situation should change and the Administration come under serious criticism, I would reactivate the mission of Ambassador Irwin in order to reaffirm his conversations as an “appropriate step” warranting deferral.
On the question of Export-Import Bank financing of U.S. copper investments, a question related directly to our non-overt economic pressures, I have decided that we should not act at this time but should keep this possibility under review in the event it could contribute to constructive discussions with the Peruvian Government. In making this decision, I have in mind: the current uncertainty about the outcome of continuing [Page 2] negotiations between U.S. copper interests and the Peruvian Government; the evident vulnerability of copper investment in Peru to further nationalist pressures, a circumstance which creates the potential for another Hickenlooper situation down the road; and, in that regard, our belief that U.S. investors in extractive industries in underdeveloped countries should make their contractual arrangements and their operations more responsive to the interests and desires of those countries in order that mining contracts have a better chance of enduring and the United States Government is not so exposed to involvement in investment disputes damaging to the broad range of our interests.
I have asked Deputy Under Secretary Samuels to give special attention to the last general problem in his study now under way on protection of American business abroad in the face of rising economic nationalism.
- Source: National Archives, RG 59, Central Files 1970–73, POL 1 PERU–US. Confidential. Drafted on January 12 by Crimmins and Stedman. The January 7 comprehensive review is attached to a January 7 memorandum from AID General Counsel Stephen Ives to Poats. (Washington National Records Center, EXSEC, Office of the Administrator, 1968–1973: FRC 75 A 013, Chron FY 79, January 2–14, 1970). The Peterson Report set forth a new approach to U.S. foreign assistance, clearly delineating the different aspects of U.S. assistance policy, and advocating setting up new institutions to implement the new policy. See Foreign Relations, 1969–1976, vol. IV, Foreign Assistance, International Development, Trade Policies, 1969–1972, Document 128.↩
- Secretary of State Rogers informed President Nixon that there was public and congressional acceptance for the deferral of the Hickenlooper Amendments to Peru and recommended that Export-Import Bank policy regarding U.S. commercial endeavors in Peru remain unchanged.↩