STAFF NOTES: LATIN AMERICAN TRENDS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001000120002-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 22
• Document Creation Date: December 12, 2016
• Document Release Date: June 29, 2001
• Sequence Number: 2
• Publication Date: May 21, 1975
• Content Type: REPORT

Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
Secret
No Foreign Dissem
,R) V IT T K
OVM
Latin American Trends
SOURCED
Secret
I ~3
May 21, 1975
No. 0510/75
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
No Foreign Dissem/No Diseem Abroad
Background Use Only/ControZZed Dissem
Warning Notice
Sensitive Intelligence Sources and Methods Involved
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Classified by 005827
Exempt from general declassification schedule
of E. D. 11652, exemption category:
fi 5B (1), (2), and (3)
Automatically declassified
on: Date Impossible to Determine
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
 Approved For Release 2001/0WitftIffP79T00865A001000120002-7
This publication is prepared for regional specialists in the Washington com-
muinity by the Western Hemisphere Division, Office of Current Intelligence,
with occasional contributions from other offices within the Directorate of
Intelligence. Comments and queries are welcome. They should be directed to
the authors of the individual articles.
CONTENTS
May 21, 1975
Brazil: Concern Over Liberalization . . . . 1
Argentina: Further Restrictions on
the News Media . . . . . . . . . . . . . . 3
Venezuela: Workers Strike Nationalized
Iron Mines . . . . . . . . . . . . . . . . 4
Venezuela: Petroleum Policy . . . . . . . . 5
Mexico: Offshore Discovery Reported . . . . 7
Cuban Foreign Minister's Job in
Jeopardy . . . . . . . . . . . . . . . . . 9
Uruguay-USSR: Fishing Talks . . . . . . . . 11
Jamaica-Trinidad: Different Paths
to the Same Goal . . . . . . . . . . . . . . 12
Costa Rica: Stepping From the
Shadows . . . . . . . . . . . . . . . . . . 15
Grenada.: The Worsening Financial
Situation . . . . . . . . . . . . . . . . . 17
Approved For Release 2001/ $ 7 0 c A- RDP79T00865AO01000120002-7
 Approved For Release 2001/0W 4TP79T00865A001000120002-7
Brazil: Concern Over Liberalization
President Geisel's program of liberalization
has engendered a good deal of strong sentiment among
its civilian supporters as well as conservative mili-
tary opponents--probably more because of what it im-
plies than what it has proven to be thus far.
Enemies and proponents alike seem to feel that
it ultimately means a substantial decrease of the
military's role in government. Thus opponents point
to the dangers of creating an atmosphere of laxness
that could embolden subversives and irresponsible
politicians. They also fear a loss of their prestige.
Supporters of liberalization hope to achieve a greater
voice in decision making and a return to the "state of
law" in which civil legal procedures prevail. Because
the liberalization effort so far has been highly tenta-
tive and does not necessarily presage any fundamental
change, both the optimism of politicians and the concern
of military conservatives appear exaggerated, if not un-
justified.
Thus far Geisel has given no firm indication that
he plans truly sweeping changes. Moreover, his actions
to date have been cautious and always subject to modifi-
cation, as in the case of the on-again-off-again censor-
ship of the press. In addition, the Geisel program has
consisted mainly of easily implemented, high-visibility
moves--such as the appointment of two former politicians
to cabinet posts, and publicized contact with the clergy.
Nor has liberalization affected in any notable fashion
the administration's authoritarian methods. Indeed, the
very decision to ease political restraints came down from
Geisel's small, closed circle of advisers. The adminis-
tration's decision to abide by the results of last fall's
unfavorable congressional elections has resulted in the
presence in congress of a number of highly vocal dissi-
dents. Yet their presence has had little if any
May 21, 1975
-1-
f'N Approved For Release 2001 /08 ftA-RDP79T00865A001000120002-7
 Approved For Release 2001/08//Oe -C14 DP79T00865A001000120002-7
discernible impact on policy making. Economic policy,
the regime's principal concern, continues to be strict-
ly the administration's preserve, as does foreign
policy. Indeed, when the congressional dissidents tried to
convoke an investigation into violations of human rights,
a particularly sensitive area, the government simply
told its legislative majority to quash the move.
The extent and effect of conservative military op-
position to liberalization is considerable and accounts
for some, but not necessarily all, of Geisel's caution.
Indeed, there is nothing in his previous background or
in his early policy moves to suggest a strong inclination
to restore civilian rule. What does appear, however, is
a desire to use the rather considerable powers that the
regime has in moderation, to avoid unduly arbitrary
actions, and to phase out the use of crude methods,notably
torture. Viewed in this light, liberalization to date
has been largely a question of style and procedure.
Nonetheless, what: Geisel clearly has done is to lay
the basis for a prolonged, widened discussion of national
issues, at least those that do not strike at the very
basis of the regime. By initiating even a controlled
dialogue, Giesel. has departed substantially from the at-
titudes of his :predecessors. (CONFIDENTIAL)
May 21, 1975
-2-
Approved For Release 2001 /AA & DP79T00865A001000120002-7
 Approved For Release 2001/0 A~ kHPP79T00865A001000120002-7
Argentina: Further Restrictions on the News Media
The government recently issued a decree forbidding
domestic media to circulate news items about events in
Argentina that have been supplied by foreign news
agencies? The decree, aimed chiefly at wire services
based in neighboring countries--and particularly in
Uruguay--will in effect force these services to rely
on the official Argentine news agency TELAM. The de-
cree further stipulates that foreign as well as domestic
news agencies operating in Argentina must register with
the government within ninety days or face suspension of
their operations. Moreover, correspondents working for
foreign agencies are also required to comply with the
new law, and failure to do so could result in their
expulsion from Argentina.
The presidential press office stated that the new
measure is "indispensable" in assuring the public it
is receiving "adequate information about the reality
of the facts." The decree is yet another step in the
increasing government censorship of information. (See
Latin American Trends, May 7, 1975). Domestic news-
papers have been prohibited from publishing foreign
news material about Argentina since August 1973. At
that time the controls were aimed at restricting press
coverage of the activities of leftist extremist groups.
The new regulation will result in censorship of all news
that is considered too critical of the government.
(UNCLASSIFIED)
May 21, 1975
-3-
Approved For Release 2001/08$C'Fi RrDP79T00865A001000120002-7
 Approved For Release 2001/?1flAf DP79T00865A001000120002-7
25X1A
Venezuela: Workers Strike Nationalized Iron Mines
President Perez may have to intervene once again
to settle a bitter labor dispute that threatens to
disrupt production in the recently nationalized iron
ore industry.
For Perez, the situation presents a political
and economic challenge to the government out of pro-
portion to its economic impact and the numbers of
workers involved. Nationalization of the iron-mining
industry is regarded as a pilot project for the much
more important nationalization of the multi-billion-
dollar petroleum industry to take place later this
year. A disruption in the production of iron ore
would seriously embarrass the government and reinforce
the fears of some in the private sector that the
government is incapable of running a large nationalized
industry.
The issues are the same that caused a similar wild-
cat strike last January: the miners are concerned that
lucrative benefits accumulated under contract with the
previous owners-.-Bethlehem and US Steep-will be threat-
ened by nationalization and are demanding the disburse-
ment of the $45 million deposited by the two US com-
panies to guarantee these benefits. In January it took
a dramatic speech by Perez and the threat of force to
end the strike and get the miners to begin negotiations
with the new mine operators--the semi-autonomous
Corporacion Venezolana de Guayana. In the three months
of relative labor peace that Perez' speech brought,
neither the government nor the CVG has been able to
satisfy the miners of the good faith of government guar-
antees that their contract benefits will be respected
in a new contract with the CVG. The talks are dead-
locked and, with. both sides hardening their positions,
more than a speech by Perez may be needed to end the new
walkout. (CONFIDENTIAL)
21, 1975
-r4-.- , T
Approved For Release 2001 /09/OS~ IW DP79T00865A001000120002-7
 Approved For Release 2001 /O lg* fDP79T00865A001000120002-7
Venezuela: Petroleum Policy
There has been a further airing of differences
within the administration over petroleum production
goals.
Last week, Finance Minister Hector Hurtado in-
formed local businessmen that petroleum production
would be reduced from the current average of about
2.4 million barrels a day to 2.2 million by next
year. Officials in the Ministry of Mines and Hydro-
carbons immediately disputed this statement, contend-
ing that it was not cleared with Mines and Hydrocarbons
Minister Valentin Hernandez, who believes current levels
should be maintained. Hernandez has privately complain-
ed in the past that other cabinet ministers have tried
to make policy end-runs around his office and on several
occasions has threatened to resign over this issue.
Although recent production cuts have been greater
than the government projected earlier because of weak
world demand, the episode underscores the confusion
within the government on major aspects of oil policy.
reports that this lack of coordi-
nation is adding to the woes of the government's
economic bureaucracies that are already plagued by
low morale, disorganization, and the departure of ex-
perienced personnel. Further resignations,particular-
ly in the areas where economic policy is formulated,
could seriously hamper the government's long-range
economic plans. Further, the differences were publicly
aired at the annual convention of the Venezuelan
Chambers of Commerce, a conservative organization,
whose members are skeptical of the government's economic
programs and its ability to run the giant petroleum in-
dustry after nationalization.
The current dispute signals not only that the
economic: technicians in both ministries have not recon-
ciled their basic differences and are prepared to make
May 21, 1975
-5-
Approved For Release 2001/08/~FOa'C&I -RDP79T00865A001000120002-7
 Approved For Release 2001/0?p DP79T00865A001000120002-7
these public, but--what is more important--that per-
sonal ambitions and rivalries among petroleum policy
makers in the cabinet have not been stilled. This
situation will have to be resolved soon by Perez if
a coherent petroleum policy is to emerge following
nationalization and if the administration is to win
the confidence of an important and influential seg-
ment of the private sector. (SECRET/NO FOREIGN
DISSEM)
May 21, 1975
-6-
Approved F FT
For Release 2001/0?/0cArEDP79T00865A001000120002-7
 Approved For Release 2001 /0 W&& RDP79T00865A001000120002-7
Tanta Frontera
Mexico: Offshore Discovery Reported
Pemex, the Mexican state oil monopoly, reportedly
has discovered oil about 8 miles offshore in the Punta
Frontera area of the Gulf of Mexico. The flow rates
of 12,001) b/d from depths of more than 12,000 feet
strengthen suspicions that the rich Chiapas and Tabasco
Fields extend well into the Gulf.
Pemex officials are not saying anything about
activity at the offshore site, but several are known
to have visited the United States early this month to
examine the latest offshore producing equipment. If
the Chiapas/Tabasco reservoirs do extend offshore,
Mexican oil reserves probably will prove to be substan-
tially larger than our present estimate of 20 billion
barrels.
May 21, 1975
-7-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
SECRET
Meanwhile, Peme~+: officials have privately con-
firmed that many Chiapas/Tabasco wells flow at high
rates--frequently as much as 1.2,000-13,000 b/d and
in some cases up to 35,000 b/d. Since present pro-
duction and transport: facilities cannot handle the
full output of all 6]. producing wells, they have been
choked down to an average flow rate of 4,100 b/d.
(CONFIDENTIAL/NO FOREIGN DISSEM)
May 21, 1975
-8-
Approved For Release 2001 /(SBC;j . DP79T00865A001000120002-7
 Approved For Release 2001/0g$/ftjk iDP79T00865A001000120002-7
Cuban Foreign Minister's Job in Jeopardy
Foreign Minister Raul Roa is in jeopardy of losing
his position of political prominence and of being put
out to pasture. He could be removed from the party's
Central Committee during the party congress next Dec-
ember and subsequently be replaced as foreign minister.
Roa himself is concerned over his future. Several
events have apparently caused him to see the handwriting
on the wall. The recent appointment of intelligence
officer Norberto Hernandez Curbelo as ambassador to
Venezuela, for example, has been interpreted by Roa as
a sign of his loss of influence. He apparently had no
voice in Hernandez' selection and considers him a poor
choice. In fact, Roa seems to have been by-passed in
the appointments of Cuban ambassadors to Peru, Argentina,
Panama, and Colombia as well; all bear the imprint of
Manuel Pineiro, chief of the party's American Department
and former head of Cuba's Liberation Directorate, the
office once in charge of Cuban subversion in Latin
America.
Furthermore, Roa--long known for his vituperative
verbal blasts--did little to enhance his prestige while
in Lima "Last December prior to the foreign ministers'
conference at Ayacucho. In publicly denouncing Chile's
General Pinochet as "a degenerate son of a bitch," Roa
embarrassed many high-ranking foreign officials and drew
a reprimand from the Peruvians.
Roa reportedly expects Deputy Prime Minister Carlos
Rafael Rodriguez to deliver the report on foreign affairs
at the opening session of the party congress and inter-
prets this, too, as a sign of his diminished stature.
In fact, however, it is Rodriguez rather than Roa who
functions as Cuba's highest official in the field of
foreign affairs and it would be quite appropriate for
Rodriguez to do the honors in this case.
May 21, 1975
FF-9-
Approved For Release 2001 /0?198 ~&-R DP79T00865A001000120002-7
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
SECRET
Roa holds the title of foreign minister, but his
role has been that of an administrator, not a policy
maker. He has acted as a conduit between the policy-
making level--Rodriguez and the members of the party's
General Department of Foreign Relations--and the policy
implementing body--the Foreign Ministry, which he heads.
Roa has been used as a. spokesman at international con-
ferences when a propaganda pitch was to be made, where-
as substantive matters involving foreign policy have
usually been handled by Rodriguez and other officials.
If Roa is not reelected to the party's Central
Committee, that would. be a likely indication that he
will also lose his post of foreign minister and be as-
signed to less strenuous duties. The Castro regime
might explain Roa's ouster by reference to his age--he
is 68--and health. Be might continue to be used
selectively by the regime on occasions calling for a
skilled propagandist, while devoting most of his time
to writing his memoirs,. (SECRET/NO FOREIGN DISSEM/NO
DISSEM ABROAD/BACKGROUND USE ONLY/CONTROLLED DISSEM)
May 21, 1975
-10-
Approved For Release 2001/ "RDP79T00865A001000120002-7
 Approved For Release 2001 gE0 R RDP79T00865A001000120002-7
URUGUAY-USSR: Fishing Talks
A Soviet fishing delegation to Montevideo failed
to conclude a joint fishing agreement with Uruguay
last week. Uruguay earlier had refused to allow Soviets
to fish within the country's 200-mile territorial sea.
Similar attempts by Poland and Bulgaria had also been
rejected.
The joint venture scheme was unacceptable because
it is contrary to Montevideo's fishing policy. Uruguay
has decided that its fishing industry should limit it-
self to small ships using on-shore facilities. The
Soviets propose investment in large factory ships.
Uruguay also insisted that both partners share in all
aspects of the venture, but the Soviets offered only
to supply the ships, leaving the on-shore investments
to the Uruguayans.
Latin America remains one of the few fishing areas
the Soviet fishing fleet has not significantly pene-
trated. Moscow has honored the claims of several Latin
American countries for a 200-mile fishing zone that al-
lows fishing only by the country's nationals. Moscow
views the joint venture approach as its best hope to
gain fishing rights. (CONFIDENTIAL)
May 21, 1975
-11-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/gWLgAWFfRDP79T00865A001000120002-7
25X1A
Jamaica-Trinidad: Different Paths to the Same Goal
The prime ministers of the two most important
Caribbean island members of the British Commonwealth
--Jamaica and Trinidad--are actively promoting pro-
grams to increase the developing countries' share of
the world's wealth. Both Michael Manley in Kingston
and Eric Williams in Port of Spain recently presented
their ideas on this subject as hosts of important
international gatherings. There are substantial dif-
ferences between the two leaders, however, on at least
one subject--the role that the Latin countries should
play in the economic development of the Caribbean.
The meeting of the British Commonwealth heads of
government in Kingston, which ended on May 6, was a
notable success for Manley. As chairman of the con-
ference he enjoyed a unique opportunity to project his
concept of a New International Economic Order, which
calls for a substantial reform. of the international
monetary and financial system to benefit developing
nations. He also strongly defended the right of these
countries to form "producer associations." The meet-
ing's final communique, called the "Concord of Kingston"
by the Jamaican press, largely reflected Manley's think-
ing. In addition, the creation of a committee of Com-
monwealth economic experts to draw up a comprehensive
program of practical measures directed at closing the
gap between rich and poor countries will provide Manley
another forum for projecting his ideas. He would like
to appear in the role of spokesman for this group,
rather than prime minister of Jamaica, when he addresses
the UN General Assembly in September.
One of the very few Commonwealth heads of state
not present in Kingston was Manley's neighbor Eric
Williams, who was preoccupied with preparing for the
16th session of the UN Economic Commission for Latin
America (ECLA) on May 6. Williams took a very active
part in the conference, delivering both the opening and
May 21, 1975
-12-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/0%)6C.l DP79T00865AO01000120002-7
closing addresses, and securing approval for two major
initiatives: a recommendation that the UN Commission
on Trans--National Corporations establish a regional
unit in Latin America for the surveillance of multi-
national corporations in the region; and a proposal for
the creation of a separate ECLA Caribbean Development
and Cooperation Committee to be headquartered in Port
of Spain. He also said that the maturing of the Carib-
bean as a distinct region warrants the establishment of
a new executive director post for Caribbean countries
in the Inter-American Development Bank.
The identity of the "Caribbean region" and the path
it should take toward development are being given dif-
ferent interpretations by Manley and Williams. The
Jamaican leader believes that the original Commonwealth
Caribbean Community was merely a stepping stone toward a
wider regional grouping, which would include the Carib-
bean Latin countries, especially Venezuela and Mexico,
and would provide alternatives to traditional Jamaican
dependence on the US and the UK. This initiative toward
the Latins started last year and the pace has increased
during 1975. Manley visited Venezuela in April and
plans to go to Mexico late next month. He has signed
agreements with both countries involving the exploitation
of Jamaican bauxite--the country's major natural resource.
Venezuela also agreed to supply Jamaica's pressing petro-
leum needs on advantageous terms.
Prime Minister Williams, on the other hand, has
expressed concern that the Latin countries will use their
economic power to "colonize" the Caribbean. He is prin-
cipally concerned about the long shadow cast by his south-
ern neighbor Venezuela, whose increasing presence in the
Caribbean is hampering some of Williams' own plans to
build up Trinidad's influence there. His reservations
apparently do not extend to Brazil, with which Trinidad
has expanded economic links during the past few years,
perhaps partly as a counterbalance to Venezuela.
May 21, 1975
-13-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
 Approved For Release 2001@]ffQ Rlo7r-RDP79T00865A001000120002-7
Both prime ministers do seem to believe that Cuba
is going to play an important part in Caribbean affairs
and are improving their ties with Havana. Williams has
accepted an invitation to visit Havana for the first
time since Castro came to power, and Manley also re-
portedly intends to make a trip to Cuba. The Jamaican
leader probably will discuss the growing Cuban technical
assistance program. Last month the director of the
Cuban agrarian reform institute led a team of experts
to Jamaica to see what. agricultural assistance could be
provided, and on May 7 a group of 33 young Jamaicans
left for Havana to study construction techniques. They
will soon be joined by 150 others. (CONFIDENTIAL/NO
FOREIGN DISSEM)
May 21, 1975
-14-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/0$I&I-WDP79T00865A001000120002-7
Costa Rica: Stepping From the Shadows
When former president Jose Figueres left office
a year ago this month many observers believed that
it was only a matter of time before he would step
from the shadows and try once again to exercise the
considerable power he has held over Costa Rican
politics since the late 1940s.
Over the past several months, the aging but ir-
repressible Don Pepe has increasingly let it be known
that he has not been satisfied with the performance
of his protege, President Daniel Oduber. The strong
implication left by Figueres is that he was trying for
a bagger piece of the political action, possibly even
to the extent of resuming the presidency.
Figueres last week was agitating for change again.
He told a business group that the country may need a
constituent assembly to rectify the malaise of the
Oduber administration. Describing himself as in a
"spirit of protest," he warned that Costa Rica was in
an "anarchic" state and that "our obligation is to
change the course to something more efficient." One
point in the constitution that Figueres is known to
want changed is the section that prohibits ex-presidents
from running again.
Figueres' talk about a constitutent assembly in-
dicates that he may have more ambitious objectives than
simply amending the constitution to permit his re-
election. A constitutional amendment would be a simpler
and less disruptive way to do this, but Figueres, for
example, charges that the present government institutions
are "weak and inadequate to deal with the current
economic problems." He may believe that a more tightly
controlled political system is what Costa Rica needs.
Some of the coup rumors currently floating around San
Jose may be inspired by Figueres in order to bring
May 21, 1975
-15-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/RDP79T00865A001000120002-7
pressure on Oduber to recommend constitutional changes
or, failing that, be forced out of office.
All this has an improbable air about it and could
be scoffed at as the prattle of a whimsical and slight-
ly foolish ex-president if it were not for the fact
that Figueres still has a great deal of political pull.
Although there is no army in Costa Rica to back Figueres,
he is well represented in the ruling National Liberation
Party. His wing of the party is decidedly dissatisfied
with Oduber, and some politicians are saying that the
country would be better off under Don Pepe's highly
paternalistic leadership.
Oduber's performance has in fact been generally
lackluster and ineffective. Economic difficulties, high
prices for food and raw materials, and a failure to live
up to his promise of skillful and productive leadership
have eroded his. popularity.
Most Costa Ricans remain strongly attached to their
country's democratic traditions and clearly prefer that
Oduber bite the bullet, establish his clear independence
of Figueres, and get to work in the three years left in
his term. The challenge for Oduber is a delicate one of
asserting his leadership while recognizing that he will
be at a political disadvantage to Figueres, who as long
as he is alive and in possession of his senses will at-
tract political power and not hesitate to use it.
(CONFIDENTIAL/NO FOREIGN DISSEM)
May 21, 1975
-16-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
 Approved For Release 2001/MDP79T00865A001000120002-7
Grenada: The Worsening Financial Situation
A little more than a year after independence,
the government of Grenada teeters on the edge of in-
solvency, unable to meet even its civil service pay-
roll of $450,000 a month without outside aid. Given
an ultimatum to pay April salaries by May 13 or face
a strike by government workers, Prime Minister Eric
Gairy postponed the day of reckoning by obtaining suf-
ficient cash from the government of Nigeria, which has
also promised to provide the May salaries and possibly
to furnish some additional funds for development and
other purposes. When the current aid is used up,
probably in early June, Gairy will again face the pros-
pect of a civil service strike. Whether the Nigerians
or some other foreign source will rescue Gairy again
seems very unlikely without a geniune Grenadian effort
to cut the oversized public payroll and institute other
reforms which would restore confidence and generate
additional public revenues.
Since shortly after requesting an end to direct
budgetary aid from the United Kingdom in 1970, the
government of Grenada has stumbled from one financial
crisis to another with no clear perception of how to
begin to solve the problems of an increasingly depressed
economy, severely limited resources, and underdevelop-
ment. For a time it even turned to short-term, high-
interest loans from foreign banks to finance its pay-
roll. The strikes and violence that accompanied inde-
pendence in 1974 crippled the tourist industry and
dried up the already meager supply of private foreign
investment.
In early May Gairy went out of his way to alienate
the United Kingdom and as a result may have given other
governments and international institutions second thoughts
about assisting Grenada. At the Commonwealth Conference
in Kingston and the ECLA Conference in Port of Spain,
May 21, 1975
-17-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
 Approved For Release 2001/S$RS)5YkDP79T00865A001000120002-7
Gairy attacked the British for "economic cruelty."
In an interview, he charged that they had exploited
Grenada for 191 years and had committed crimes graver
than those of Adolf Hitler. Gairy specifically ac-
cused Britain of reneging on a promised $240,000 inde-
pendence gift and threatened to take his case to the
UN and the International Court of Justice. He also
repeated his oft-heard threat-to seek help from the
Communist countries.
If he had hoped to bully or blackmail the British,
Gairy seriously miscalculated. The British High Com-
mission in Port of Spain promptly revealed that the
independence gift was withheld after it was discovered
that Gairy's government had misappropriated $600,000
in British development funds. The Commission further
stated that the Grenadians had admitted culpability
and had agreed in writing to make restitution by giving
up the independence gift and repaying the balance in
monthly installments during 1975-76, but had made only
one so far. (CONFIDENTIAL)
May 21, 1975
-18-
SECRET
Approved For Release 2001/08/08 : CIA-RDP79T00865A001000120002-7
 Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7
Secret
Secret
Approved For Release 2001/08/08 : CIA-RDP79T00865AO01000120002-7