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

346. Memorandum of Conversation¹

Washington, September 8, 1977, 5:15–5:50 p.m.

SUBJECT

• President Carter/Honduran Chief of State Melgar Bilateral

PARTICIPANTS

• HONDURAS

  • Brigadier General Juan Alberto Melgar Castro, Chief of State of Honduras
  • Colonel Roberto Palma Galvez Minister of Foreign Relations
  • Dr. Roberto Lazarus, Ambassador of Honduras
  • Mr. Guillermo Bueso, President of the Central Bank

• US

  • President Carter
  • Vice President Mondale
  • Secretary Vance
  • Assistant Secretary Todman
  • Robert Pastor (NSC)
  • Charge Carl Bartch

The President said it was a great pleasure to have the Honduran Chief of State in this country. He said he was grateful that the Chief of State had taken the time to come here to attend the ceremonies in connection with the signing of the treaties between ourselves and Panama.² He said this is very important to our people, and it also provided an opportunity to meet and consult with other leaders of the hemisphere. The President expressed the hope that the Chief of State’s visit would be pleasant and productive. He added that he wished to express his regret that the Chief of State’s wife couldn’t be here because of her father’s recent death. He said he hoped the Chief of State would convey his best wishes and condolences to his wife.

The President said he had received the very good news that the Congress of El Salvador had approved, by unanimous vote, the border mediation agreement with Honduras.³ He said he hoped that this might prove to be the first step in the elimination of the differences between Honduras and El Salvador. The President said that he would like the Chief of State’s analysis of what might be expected in the future.

General Melgar said that in his reply to the President’s letter he had said that he wished to discuss two subjects.⁴ He was very pleased to note that El Salvador’s action in ratifying the mediation agreement had so happily resolved the first problem he had to discuss. General Melgar said he hoped to meet with the President of El Salvador tonight to celebrate the good news with him. Just as the President had expressed the hope that the signing of the Panama Canal treaties would usher in a new era of good relations with Latin America, he hoped that El Salvador’s action would resolve Honduras’ difficulties with El Salvador. The best news I can take back to the people of Honduras, he said, is the very good news that El Salvador has ratified the agreement.

General Melgar thanked the President for mentioning the death of his wife’s father. He said unfortunately and painfully, they keep the tradition of mourning for a long time, and therefore his wife couldn’t come. He added, however, that he and his wife hope they can both come here in the near future.

General Melgar said the second subject he wished to raise was a matter affecting not only Honduras, but Guatemala, El Salvador, and Nicaragua as well. He said he hoped President Carter could help in this matter.

President Carter asked General Melgar what kind of help he needed. General Melgar replied that he referred to the study concerned with the El Cajon hydroelectric project. He said Honduras is ready to begin construction of this very important project, but needs backing.

The President said he is familiar with the project but that it is not possible under our AID program to finance that kind of project. He said that ordinarily the World Bank and the IDB or some other long-term lending institution may be able to assist in financing such projects, and we would be glad to work with Honduras on this. He said that AID is designed to undertake small, short-term projects, but it’s illegal for AID to engage in these other projects. He said perhaps the Secretary of State could explain other opportunities that may exist.

The Secretary said that as the President stated, nothing can be done under AID. Perhaps something might be done by the Eximbank, and we would be pleased to explore this with the Honduran Ambassador.

Mr. Bueso said Honduras is ready to move forward with the El Cajon project; that some financing is being obtained from the IBRD and the IDB, but more money is required. He said Honduras has been in contact with the Germans, Canadians and the Arabs in an effort to obtain special concessional financing. He said this project is of a regional character and Honduras and its neighbors need it to develop their markets. He said if the project is not undertaken soon, Honduras will suffer from a severe fuel shortage, and will be forced to import more petroleum, at increasing cost.

Mr. Bueso said the Hondurans are well aware of the points the President and the Secretary made, but Honduras is asking for U.S. support in the IDB to obtain assistance through the Fund for Special Operations. He said the Hondurans not only need IBRD and IDB funds but additional funds under soft, concessional terms. He said Honduras’ requirements are of a special nature, and if its negotiations with Canada, Germans, and the Arabs are successful there could also be good news on this project.

The Secretary said perhaps we could study this matter with the Treasury Department to see if anything might be done to help.

General Melgar said the Hondurans would await this development.

The President responded that the Hondurans should continue to work on standby financing while they are waiting. He said we are very much interested in Honduras’ economic development. It is part of multilateral cooperation and the friendly relations that might result from it. The Secretary will discuss it with Treasury, and, the President said, he would take a personal interest in this matter. He added that he is interested in the fact that the Hondurans turned to the Arabs and European countries, which increases the chances of success of the Hondurans’ efforts.

The Secretary said the Shah of Iran is particularly interested in this kind of project. He said he talked to the Shah several months ago.⁵ He said if the Hondurans have not been in touch with the Shah, it might be worth their while to do so.

Ambassador Lazarus said he only wanted to say one thing. Banks such as the World Bank and the IDB know all about the El Cajon project, having studied it for years. Nevertheless, they still find obstacles. He said that although the delegations were told that no gifts were to be exchanged on this visit to the U.S., the Hondurans would be pleased to accept one present—U.S. support for the El Cajon project.

The President said the Hondurans have already given something important to us, and that is the ratification on the American Human Rights Convention, and we do appreciate it; so perhaps that would be a fair exchange.⁶

The President presented the Chief of State with a copy of his book Why Not the Best? and a book of space photographs. He said similar photos could be used for analyzing crops and undertaking geological and geodetic surveys, if the Hondurans are interested.

The Chief of State thanked the President, and said the Foreign Minister had taken the initiative in the move to ratify the American Human Rights Convention. He said he is well aware of the President’s great interest in human rights, and he is happy to report that there is broad respect for individual rights and freedom in Honduras.

1. Source: Carter Library, National Security Affairs, Staff Material, North/South, Pastor Files, Country Files, Box 27, Latin America: 2–9/77. Confidential. Drafted by Bartch. The meeting took place at the White House.
2. Torrijos and Carter signed the Panama Canal Treaties in Washington on September 7. The Treaties effected the future transfer of control of the Panama Canal from the United States to Panama after 1999. See Foreign Relations, 1977–1980, vol. XXIX, Panama.
3. The ratification of the October 1976 border mediation agreement was part of the peace process following the 1969 war between Honduras and El Salvador. See Foreign Relations, 1969–1976, vol. E–11, Part I, Documents on Mexico; Central America; and the Caribbean, 1973–1976.
4. Carter wrote to Melgar on August 27, inviting him to visit Washington to participate in the Panama Canal Treaties’ concluding ceremonies. (Carter Library, National Security Affairs, Brzezinski Material, President’s Correspondence with Foreign Leaders File, Box 8, Honduras Chief of State Juan Alberto Melgar Castro, 8/77–2/78) As reported in telegram 4068 from Tegucigalpa, August 31, Melgar accepted the invitation in an August 30 letter to Carter and indicated his intention to discuss his country’s need for assistance and the El Cajon hydroelectric project, as well as the peace negotiations with El Salvador. (National Archives, RG 59, Central Foreign Policy File, D770316–0922) For additional documentation on the peace-keeping effort for El Salvador and Honduras, see Document 365.
5. Vance met with the Shah in Tehran during the CENTO Ministerial meeting May 12–15. A record of their conversation is scheduled for publication in Foreign Relations, 1977–1980, vol. X, Iran: Revolution, January 1977–November 1979.
6. The American Convention on Human Rights was adopted at a meeting of Western Hemisphere states in Costa Rica in 1969 and came into force in 1978 after ratification by eleven Latin American countries. See Foreign Relations, 1977–1980, vol. II, Human Rights and Humanitarian Affairs, Document 47.