HANSON’S LATIN AMERICAN LETTER - Washington - 9 August 1980 - Number 1847

Sep 21, 2026

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A letter dated 9 August 1980 from Washington addresses the arms embargo policy debate involving Britain, Chile, the United States, and Peru. It contrasts Britain’s parliamentary justification for lifting the embargo with the U.S. approach of restricting orders while funding Soviet-linked armament deliveries to Peru. The text summarizes AID’s rationale for concealed soft loans totaling $211 million to sustain Peru’s ability to pay for offensive weapons, alongside fiscal 1979–1981 aid allocations and disputed claims about Peru’s economic deterioration, debt service, and export performance.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages5

Reading Time13 min

AccessFree to download

Two Positions

British policy to boost British exports

U.S. policy to pay for Russian armament

Why Peru cannot afford food from its resources

Why does it require this high level of assistance?

HANSON’S LATIN AMERICAN LETTER WASHINGTON 9 August 1980 Number 1847 Dear Sir: "Britain's arms embargo against Chileis being lifted,the Government announcedyesterday..As no other European countryoperates an arms embargo against Chile,the decision brings British policy intoline." …The Times(London),July 23. Now the issue is joined.And with a choice between the European policytypified by the position on Chile,and the U.S.policy implemented onPeru,it is going to be very difficult to avoid a change in U.S.policy.It is extremely important to understand the difference in the policies: # TWO POSITIONS (1)The British Government in the parliamentary written answer by theMinister of State at the Foreign Office said that "the human rightsposition in Chile has improved considerably since 1974 when the LabourGovernment imposed the embargo,and is no worse than in many othercountries."And it was noted that the Chilean Navy is in the market fora variety of ships for which British shipbuilders can now hope to winorders. # BRITISH POLICY TO # BOOST BRITISH EXPORTS (2)In contrast,the U.S.Government will not permit armament ordersto be placed in the United States by Chile,but it will in effect pay forSoviet Russian shipments of armament to Peru! # U.S.POLICY TO PAY FOR RUSSIAN The Agency for International Development told the House Foreign AffairsCommittee that after ordering some $900 million of offensive weapons fromthe Soviet Union,"Peru does not have the financial capacity to providebasic public services for its poorer citizens." # EXPORTS OF ARMAMENT TO PERU Therefore,AID recommended that over three years(fiscal 1979 throughfiscal 1981)the United States give $211 million in concealed grants(soft loans)to Peru to enable it to pay for the Russian armament whichhas touched off an arms race on the west coast and to pay for the ex-panded military establishment which such a great inflow of offensivearmament requires. $211 MILLION FOR # DOWNPAYMENT ON RUSSIAN ARMAMENT Look at the table below: | | | | | --- | --- | --- | | Transfer₁f0ns of dolacss to Peru | | | | | | | | FSs76.1979
Grand Total: | Fasc59.1980 | Fa976.1981 | | 5.5
Military | 3.3 | 4.4 | | 5.0
Arms Sales | 3.0 | 4.0 | | 0.4
Training | 0.3 | 0.4 | | 70.2
Economic | 55.4 | 71.3 | | Developmental 32.8 | 17.9 | 30.5 | | 34.2
P.L.480 | 33.8 | 35.6 | | 1.3
Narcotic
Control | 1.7 | 3.0 | | | | | | 2.0
Operating | 2.0 | 2.2 | | Expense | | | | Misc. | | | A weckly leter for buriesmen pmMisbnd prinsdly in Wasbington,D.C. Peru,the Agency for Internationa1 Development felt,cannot afford toWHY PERUpay for food for its minimum essential requirements if it was at theCANNOTsame time to gear its military activities to the immense flow of armamentAFFORD FOODacquired from the Soviet Union and to service its debts to the SovietFROM ITSUnion.Thus,the $103 million over three years in P.L.480 agriculturalOWNproducts from the United States.On the other hand,the arms deliveriesRESOURCESfrom the United States will be of petty proportions($12 million over threeyears),just enough so that if trouble breaks out internally,it will bepossible to blame the U.S.rather than the Soviet Union for armament in use,this especially since the Soviet arms are sophisticated offensive weapons intendedfor war with Chile and/or Ecuador,The British do this better,as their Chileandecision indicates,That is to say,they will not sell arms and weapons likely to beuseful against civilian internal difficulties,but will go after the big major weaponsbusiness, The House Foreign Affairs Committee was actually not too well informed "WHY DOESon the armament flow into Peru,but even so it spotted a flaw in the pre-PERUsentation intended to justify such a disproportionate share of U.S.aidREQUIREin Latin America going to Peru,THIS HIGHLEVEL OFThe Committee asked;"S

FAQs

What is the central policy contrast discussed in the letter?

The letter contrasts Britain’s Chile-related arms embargo decision with a U.S. policy that restricts U.S. armament ordering by Chile while effectively paying for Soviet-linked shipments to Peru.

How does the letter describe AID’s justification for aid to Peru?

It states that AID recommended $211 million in concealed soft loans over fiscal 1979–1981 so Peru could pay for Russian armament and the expanded military establishment it requires.

Why does the American Embassy in Lima challenge the “deterioration” claim?

It argues that 1980 outlook includes a strong external accounts position, improved domestic growth, falling inflation pressures, and specific export and balance-of-payments figures, including improved debt service ratios.

Sep 21, 2026

Uploaded by Aurora