139. Memorandum From the Assistant Secretary of State for Inter-American Affairs (Rubottom) to the Deputy Under Secretary of State for Economic Affairs (Dillon)1
SUBJECT
- International Finance Corporation: Processing of Loan Applications from Latin American Countries
At the Buenos Aires Economic Conference, which begins August 15, 1957, we can, I believe, expect to have a difficult task of negotiations due to the continuing impossibility of our acceding to Latin American demands for money and measures that they say they need for their economic development.
One of the most insistent of these demands is that for more US public capital. Time and again, for example, the Latin Americans have proposed an inter-American bank. Our position has been and is that the existing international lending institutions are adequate.
At the Rio Economic Conference in 1954 we used our participation in the International Finance Corporation as an example, along with the Export-Import Bank and the IBRD, to demonstrate the scope and adequacy of lending institutions already available or to be available to the Latin Americans.
The IFC has not as yet, I understand, taken final action on any of the loan applications which it has received. All of the Latin American countries, except one, are eligible to request IFC loans, and those countries have already submitted some twenty-five applications.
To demonstrate at Buenos Aires the persuasiveness of our position on the adequacy of existing lending institutions, it would be highly desirable for the IFC to take action on at least some of the Latin American applications before the Buenos Aires Conference begins.
We are not advocating favorable action on any particular application or applications. We would simply urge that, because of the Buenos Aires Conference, the IFC now complete as soon as possible its processing of the applications from Latin America so that any of them which merit favorable action might be announced prior to August 15.
Presumably the most effective way of seeking to accomplish this objective would be to discuss the foregoing frankly with Mr. Robert L. Garner, [Page 510] President of the IFC. Mr. Garner is, I understand, out of the country at the present time but will return shortly.
Recommendation:
That you, Mr. Kalijarvi, and I, at your convenience, meet with Mr. Garner for the above purpose as soon as possible.2
- Source: Department of State, OAS Files: Lot 60 D 665, BAEC. Official Use Only. Drafted by Sanders.↩
- The following handwritten notation by Dillon appears on the source text: “Have already spoken to Garner in this vein without success. He professes sympathy and blames delay on prospective borrowers. Suggest you follow up alone and attempt to pin him down re one or two specific projects. If you have any success, I will be glad to tackle him further on any specific project.”↩