Economic Nationalism in Latin America

Report Outline
Current U.S. Controversy With Peru
Reasons for Rise of Latin Nationalism
Elements of a U.S.-Latin Accommodation
Special Focus

Current U.S. Controversy With Peru

Threatened Loss of Foreign Aid and Sugar Quota

Unless a face-saving device is found at the last moment, President Nixon must cut off American aid to Peru on April 4 and suspend that country's lucrative U. S. sugar quota on April 9. As matters now stand, the President has virtually no choice. He is required by law to take the foregoing steps in retaliation for Peru's expropriation of American-owned property, Oct. 4, 1968, without adequate compensation.

Up to now, the Peruvian government has shown little inclination to ease the crisis by offering to make some kind of reasonable settlement with the International Petroleum Co., a subsidiary of Standard Oil of New Jersey. On the contrary, the Peruvians have escalated the crisis. Their latest move, the presentation to I.P.C. on March 23 of an additional bill for delinquent taxes, brought to over $1 billion the total amount claimed from the company. By contrast, the Peruvian government has valued the seized properties at only $71 million.

As the clock ticks toward the two deadlines, several other Latin American nations are quietly lining up with Peru. United States businessmen with interests in Latin America no longer find comfort in the view that the Peruvian affair is an isolated case. For the evidence is that this country is in for trouble all over Latin America. The Peruvian crisis has revealed a strong undercurrent of hostility there. By openly defying the United States, Peru's military leaders have brought into the open more than a century of accumulated antagonism toward “imperialist exploiters,” mainly in the form of U. S. businessmen. A strong sentiment of economic nationalism, based on fear of domination by foreign—especially American—interests, pervades the Latin nations.