579. Memorandum From the Deputy Under Secretary of State for Economic Affairs (Prochnow) to the President of the Export-Import Bank (Waugh)1

SUBJECT

  • Loan to Petroquimica by Export-Import Bank

Pursuant to the views which were expressed by Mr. Rubottom and myself on behalf of the Department of State during our meeting with you this morning, I wish to record in this memorandum the position that United States Government funds of the Export-Import Bank not be used to help in the financing of the purchase of pipe [Page 1145] for the gas pipeline from the Anaco Field in Venezuela to the Petroquimica Plant. The Department has given careful consideration to all of the factors which are involved and has concluded that it would be unwise for United States public funds to be used to help finance this project which, as you know, is a 100 Venezuelan Government financed entity. We believe that this is an appropriate project for private financing and that it should be possible to raise the necessary capital to finance the pipeline through private sources.2

Herbert V. Prochnow3
  1. Source: Department of State, Central Files, 831.2553/10–3056. Official Use Only. Drafted by Prochnow with the assistance of Rubottom.
  2. At the meeting of the Board of Directors of the Export-Import Bank, November 8, the application for the loan was denied on the grounds that the dollar position of Venezuela was strong enough that private financing should be available. Additional documentation on the subject is ibid., 103–XMB.
  3. Printed from a copy which bears this typed signature.