The Caribbean : its economy

The

CARIBBEAN:

ITS ECONOMY

SERIES ONE

VOLUME IV

A publication of the
SCHOOL OF INTER-AMERICAN STUDIES
which contains the papers delivered at the fourth annual conference on the
Caribbean held at the University of Florida, December 3, 4, and 5, 1953.

ISSUED WITH ASSISTANCE FROM
THE WALTER B. FRASER PUBLICATION FUND

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The
CARIBBEAN:
ITS ECONOMY

edited by A. Curtis Wilgus

1962
UNIVERSITY OF FLORIDA PRESS
Gainesville

UNiV33ITY YOF FLOhP. A Lim.iaS

Copyright, 1954, by the
UNIVERSITY OF FLORIDA
ALL RIGHTS RESERVED

A University of Florida Press Book
L. C. Catalogue Card Number: 54-11459

FIRST EDITION, 1954
LITHOPRINTED EDITION, 1962

Lithoprinted by

DOUGLAS PRINTING COMPANY, INC.
JACKSONVILLE, FLORIDA

Contributors

JOHN S. ALLEN, Acting President, University of Florida

FRANK K. BELL, Vice President, Alcoa Steamship Company,
Inc.

JOHN M. CABOT, Assistant Secretary of State for Inter-American
Affairs, U. S. Department of State

MARY M. CANNON, Chief, International Division, Women's
Bureau, U. S. Department of Labor

FELISA RINc6N GAUTIER, City Manager of San Juan, Puerto
Rico
EARL P. HANSON, Chairman, Department of Geography and
Geology, University of Delaware, Newark

ROSCOE R. HILL, Former Chief, Division of National Archives,
United States Department of State

WILLIS KNAPP JONES, Professor of Romanic Languages, Miami
University, Oxford, Ohio

PERCY C. MAGNUS, President, Magnus, Mabee, and Reynard,
Inc., New York City

OCTAVIO MENDEZ PEREIRA, Rector, University of Panama,
Panama
JOHN M. MITCHELL, Manager, Export Division, Aluminum
Company of America
LILLY DE JONGH OSBORNE, Writer and Lecturer, Guatemala
City

V

vi

The Caribbean

WILSON POPENOE, Director, Pan American Agricultural School,
Tegucigalpa, Honduras
ALAN PROBERT, Assistant Regional Director, Region IX, Bureau
of Mines, U. S. Department of the Interior
JosE ROLZ BENNETT, Dean, Faculty of Humanities, University
of San Carlos of Guatemala
CARL 0. SAUER, Chairman, Department of Geography, Uni-
versity of California, Berkeley
ERNST SCHWARZ, Assistant Secretary of the Inter-American
Regional Organization and Executive Secretary, Committee
on Latin-American Affairs, CIO, New York
CLARENCE SENIOR, Research Associate, Bureau of Applied Social
Research, Columbia University
CARLETON SPRAGUE SMITH, Chief, Division of Music, New
York Public Library
DAVID B. STEINMAN, Consulting Engineer, New York City
VI'CTOR L. URQUIDI, Acting Director, Economic Commission for
Latin America, United Nations, Mexico City
A. CURTIS WILGUS, Director, School of Inter-American Studies,
University of Florida

Foreword

THE ECONOMIC PROBLEMS discussed in this volume of
proceedings of our Fourth Annual Caribbean Conference are of
considerable current importance. The Caribbean area is coming
more and more into the spotlight of public interest in the United
States, and our businessmen are looking toward the area as one
to be developed with the assistance of United States capital.
The presence of business representatives at our conference testi-
fies to their awareness of and increasing attention to a part of
this hemisphere which is assuming an ever-greater role in world
trade. The State of Florida, so closely related to this area, is
naturally interested in the economic life and character of the
countries immediately south of us.
We believe that these papers make a real contribution to the
literature on the Caribbean, and we are sure that these yearly
conferences serve a very real purpose in calling attention in a
scholarly way to the innumerable Caribbean problems. Con-
sequently, we are glad to publish these papers in book form in
the belief that the volume will serve as a useful aid to the
student, teacher, businessman, or government official who finds
his interests centered in the area.
Again, the University of Florida expresses its appreciation to
the Aluminum Company of America, through the Alcoa Steam-
ship Company, Inc., for helping to make the conference possible
and successful. We feel that the association in this project of
one of the great national business organizations with our School
of Inter-American Studies is a significant example of the rising
interest in the neighboring Caribbean area.
JOHN S. ALLEN, Acting President
University of Florida

vii

Contents

Map of Caribbean Area . .. .Frontispiece
List of Contributors . . . v
Foreword-JoHN S. ALLEN . . Vii
Introduction-A. CURTIS WILGUS . .. xi

Part I INTRODUCTION
1. John M. Cabot: CONTEMPORARY FORCES AT WORK
IN THE CARIBBEAN TODAY . 3

Part II -RESOURCES AND PRODUCTION
2. Carl 0. Sauer: ECONOMIC PROSPECTS OF THE
CARIBBEAN . .. 15

3. Wilson Popenoe: AGRICULTURAL ENGINEERING IN
THE CARIBBEAN . .. 28

4. Alan Probert: THE ROLE OF MINERAL RESOURCES
IN THE ECONOMY OF THE CARIBBEAN 35

5. Felisa Rincon de Gautier: PUERTO RICO-ITS RE-
SOURCES AND GOVERNMENT .. 60

6. Jose Rolz Bennett: GUATEMALA-ITS RESOURCES
AND RECENT EVOLUTION 67

Part III MANUFACTURING AND INVESTMENTS
7. Victor L. Urquidi: FINANCING INVESTMENT IN
MEXICO AND CENTRAL AMERICA 87

8. Percy C. Magnus: POLITICO-ECONOMIC REFLEC-
TIONS ON EXPROPRIATION IN THE CARIBBEAN 105

ix

x The Caribbean
Part IV -TRANSPORTATION AND MARKETING
9. Frank K. Bell: SHIPS AND SHIPPING IN THE
CARIBBEAN . 117

10. David B. Steinman: ROADS AND BRIDGES IN THE
CARIBBEAN-THE ROLE OF THE ENGINEER 126

11. John M. Mitchell: CARIBBEAN TRADE-A TWO-WAY
STREET . .. 136

Part V- LABOR AND INDUSTRY
12. Mary M. Cannon: LABOR AND GOVERNMENT IN
THE CARIBBEAN . .. 151

13. Ernst Schwarz: SOME OBSERVATIONS ON LABOR
ORGANIZATION IN THE CARIBBEAN 163

14. Clarence Senior: HOUSING AND SANITATION IN
THE CARIBBEAN . .. 177

15. Earl Parker Hanson: INDUSTRY AND PUBLIC WORKS
IN PUERTO RICO . .. 191

Part VI- CULTURE AND THE ECONOMY
16. Octavio Mendez Pereira: BASIC EDUCATION AND
THE STANDARD OF LIVING IN THE CARIBBEAN 203

17. Willis Knapp Jones: THE CARIBBEAN DRAMA-
A LITERARY COCKTAIL .. 219

18. Carleton Sprague Smith: MUSICAL SETTINGS OF
CARIBBEAN POETRY .. 240

19. Lilly de Jongh Osborne: GUATEMALAN ARTS AND
CRAFTS-A SUMMARY .. 259

20. Roscoe R. Hill: CARIBBEAN ARCHIVALIA .. 268

Index . . . .. 279

Introduction

THE CARIBBEAN AREA, to a greater or lesser degree, con-
tains most of the economic characteristics found in other parts of
Latin America. It is true that the Caribbean rivers may not be so
long, the mountains not so high, the soil not so rich, the climate
not so intensely tropical, the mineral resources not so extensive,
nor the industries so varied as in some other parts of Latin
America. Nevertheless the people are able to obtain from the
soil the kinds of products that are found in other continental
areas. Year by year man learns more about the natural re-
sources of the Caribbean and takes more effective steps to wrest
from nature the things which he needs to sustain life and to
develop his culture.
In this conference the participants have examined the natural
and human resources of the Caribbean area with the dual aim
of discovering the critical economic factors and of suggesting
solutions for economic problems. It is the object of this brief in-
troduction to discuss a few of the economic and human factors
found in the whole of Latin America so that the reader may
appreciate how the economic life of the Caribbean compares
with and is related to the economic life of Latin America in
general.
I
The geographic area of Latin America is about 8,600,000
square miles. This embraces one-seventh of the total area of the
world. In this vast region, however, live only about 4 per cent of
the earth's total population. The majority of these 150,000,000
Latin Americans live along or near the borders of the continent.
There are large interior areas where the population is less than

xi

The Caribbean

one per square mile. These uninhabited, or nearly uninhabited
regions, are the extensive deserts, the rugged mountain areas,
and the impenetrable and often unexplored jungle areas, where
man has not found nature congenial and where he cannot live
without a tremendous struggle.
Climate is an important environmental factor in the life of
Latin America. Because climatic conditions are generally in-
escapable, man must either take advantage of his environment
or succumb to its influence. About three-quarters of Latin
America lies within the tropics, where life is difficult. But even
at high elevations where the climate is considerably modified,
man also finds difficulty in making a comfortable living. Hence
the remaining areas of Latin America in the temperate zone
have been the chief centers of economic, social, and political
progress.

II
Since colonial days, the economic life of Latin America has
been predominantly agricultural, or based upon agriculture.
Today in most of the countries the rural element predominates,
and it is estimated that 58 per cent of the population of Latin
America is now engaged in agriculture or animal husbandry.
Despite this seeming uniformity in economic character, each of
the Latin American countries during the past century has de-
veloped an economic individuality. For example, Argentina
and Uruguay are known for their wheat and meat production.
Brazil has become universally recognized as one of the great
coffee-producing countries of the world. Cuba has specialized in
sugar production. Paraguay has produced the well-known yerba
mate. Several of the Central American countries are leading
banana-producing areas. When we examine mineral production
in Latin America, we think of nitrates and copper in Chile;
vanadium, silver, and gold in Peru; tin in Bolivia; oil and iron
in Venezuela; platinum and emerald in Colombia; silver and
oil in Mexico, and so on. When we look at manufacturing

xii

EDITOR S INTRODUCTION X111ii
development, we see Argentina, Brazil, Mexico, and, to a lesser
extent, Venezuela as leaders, but with this activity increasing in
most of the Latin American states owing in part to United States
technical assistance and the Point Four programs.
Since agriculture predominates in Latin America generally, let
us look a little closer at the production of the soil. Dr. George
Wythe* has asserted that about 5 per cent of the land area of
Latin America is farm land and that of this percentage perhaps
two-thirds is cultivated in any given year. It is believed that
most of the readily available farm land has been put to cultiva-
tion, though not to the fullest extent of productivity. With larger
expenditures for fertilizer and possible irrigation and drainage,
other land may eventually be brought into agricultural produc-
tion. Some areas like the Amazon basin, though rich in soil,
cannot be used for the production of annual crops because of
climatic conditions. The most efficiently produced agricultural
products in Latin America today are grains in Argentina; sugar
in Cuba, the Dominican Republic, and Peru; coffee in Central
America, Brazil, and Colombia; bananas in Central America;
fresh winter vegetables in Cuba and Mexico; and cotton in irri-
gated valleys of northern Mexico and Peru. Even in some of
these areas the soils are exhausted, primitive methods keep down
production, and human energy limits standards of living. In
many Latin American countries agricultural products are raised
on large estates, while in others the peasant farmer uses perhaps
one or two acres at the most (but more often less than an acre
of land) for his agricultural activities. In some countries, as in
Mexico for example, where the land has been distributed to the

For some detailed information used in this paper, the writer is indebted
to Dr. George Wythe, director, American Republics Division, U.S. De-
partment of Commerce, for his studies in Latin American economic life,
especially his "International Trade in the Caribbean Area" in The Carib-
bean: Peoples, Problems, and Prospects (Gainesville: University of Florida
Press, 1952), and his forthcoming article on "Latin America: Economic
Factors" for the Encyclopedia Americana (1955 ed.).

The Caribbean

peasant by the government, agricultural production has in-
creased. An example of this is found in a recent announcement
that Mexico will export corn in 1954. Crop surpluses have often
been the result of improvement in plant breeding, assisted in
some areas by the Rockefeller Foundation and by the Inter-
national Basic Economy Corporation. Moreover, United States
government agencies and the Food and Agricultural Organiza-
tion of the United Nations have rendered assistance in certain
areas.
Another phase of agricultural production is animal husbandry.
The area of greatest development is in the La Plata countries,
which supply wool, hides, and meat for export. Ranching is in-
creasing in some other areas of Latin America, notably Brazil,
Chile, Peru, and Mexico. The dairy industry also is rising to
importance in various regions. As would be expected, Argentina,
Uruguay, and Chile have developed the milk-and-cheese in-
dustry.
Still another phase of agricultural production relates to forests.
It is estimated that Latin America has about 30 per cent of the
forested areas of the world, a large proportion of which consists
of hard woods or tropical soft woods, for which there as yet
seems to be very little commercial use. The largest reserves of
temperate-zone soft woods are in southern Brazil, southern Chile,
and in Mexico and Central America. There are vast areas, such
as the pampas of Argentina, where no trees grow unless planted,
and in the llanos of Venezuela where trees also must be planted.
A related phase of agriculture concerns fisheries. Despite the
fact that the people of Latin America are chiefly Catholics, the
consumption of fish has not been as great as normally would be
expected. According to Dr. Wythe, the per capital consumption
of fish in Latin America is slightly less than ten and a half
pounds per individual, although in Chile and Venezuela it is
over thirty pounds per individual. Today the leading countries
engaged in fishing are Brazil, Peru, Chile, Argentina, Venezuela,
and Mexico.

xiv

EDITOR S INTRODUCTION

III
A great variety of minerals are produced in the Latin Ameri-
can countries. In 1950, Latin America accounted for 40 per
cent of the world production of silver, 19 per cent of the copper,
lead, and tin, 16 per cent of the zinc, 6 per cent of the gold, 5
per cent of the manganese and chrome, 3 per cent of the mer-
cury, and significant proportions of metals used as alloys in the
chemical industry. Latin America also is the main source of
supply of such minerals as quartz crystals and of nonmetallic
minerals, such as sodium nitrate in Chile, graphite in Mexico,
and various kinds of precious stones in Brazil, Venezuela, and
Colombia. The chief Latin American countries producing coal
are Brazil, Chile, Colombia, Mexico, Peru, Venezuela, and Ar-
gentina, in that order. Of petroleum, Latin America accounts
for nearly 19 per cent of the world output and 54 per cent of
the world exports of crude petroleum. In the leading producer,
Venezuela, oil provides 97 per cent of the total value of exports
and 60 per cent of the federal revenues of the country. Export
surpluses of petroleum also are found in Mexico, Colombia,
Peru, and Ecuador.
IV
An important aspect of economic life concerns economic sta-
bility, which in Latin America has been upset frequently by
political instability. The local currencies of the Latin American
countries have fluctuated from time to time, some in relation to
the pound sterling and some in relation to the dollar. In several
of the countries the pressure of inflation has forced devaluation
and occasionally exchange restrictions. During the period of
economic expansion, from about 1870 to 1930, exchange trans-
actions and the financing of foreign trade comprised the banking
activities of most of the countries. Frequently these banks were
branches of foreign banks. After the First World War, central
banks were established in many of the countries and new bank-
ing laws were enacted. Especially after 1930, some of the central

XV

xvi

The Caribbean

banks became major instruments of national policy through the
control of credit, foreign exchange, and trade, and also by pro-
viding funds for economic development within the country.
To help develop such facilities as ports, railways, and public
utilities, foreign capital has gone into Latin America in large
amounts. Foreign investments reached a peak of about 8.5 bil-
lion dollars in 1913, of which half was British, 1.6 billion French,
1.2 billion American, and the rest German and other invest-
ments. When French and German investments were liquidated
after the First World War, United States investments increased
rapidly. By 1950, direct investments of United States capital in
Latin America stood at 4.7 billion dollars. British investments
had declined to about 1.5 billion. By the end of 1950, direct
private investments in Latin America were distributed as follows
(in millions of dollars) : petroleum, 1,408; transportation, com-
munications, and public utilities, 1,042; manufacturing, 780;
mining and smelting, 628; agriculture, 520; trade, 243; finance
and insurance, 71; miscellaneous, 45. By the middle of 1953,
the indebtedness of the Latin American governments to the
United States government, chiefly from Export-Import Bank
loans, stood at 684 million dollars.

V

Latin America's share of world trade, according to Dr. Wythe,
has risen from about 7 per cent before the Second World War to
slightly under 10 per cent by the end of 1950. In 1951, Latin
American exports exceeded imports by about 200 million dollars.
During the last fifty years the economic life of Latin America
has become very closely linked to the economic life of the United
States. According to Dr. Wythe, the factors working in this
direction have been "improvements in transportation and com-
munications, a large increase in U. S. investments, the effect of
two world wars, the industrial expansion of the United States,
and the trend toward colonial preferences on the part of Euro-

EDITOR'S INTRODUCTION Xvii
pean countries. Since the Second World War the United
States has provided on the average slightly over half of Latin
American imports, while the European share has been about
29%. Although the volume of European shipments is consider-
ably above the prewar level, most of the substantially increased
volume of Latin American imports has come from the United
States."
In 1952, inter-Latin American trade stood at about 9 per cent
of the total. Trade between Argentina, Brazil, and Chile ac-
counts for about 80 per cent of this inter-American trade, while
Bolivia, Peru, and Ecuador take about 8 per cent of the total.
Considerable interest now exists in developing regional preferen-
tial trade arrangements among various groups of countries-for
example, the Central American republics and the three states of
Gran Colombia (Colombia, Venezuela, and Ecuador).

VI

Since the mid-1930's, the manufacturing and construction in-
dustries have increased, being favored by improved fiscal policies,
government public works programs, and the necessity to produce
certain products cut off by war and international tensions. All
the countries have some modem manufacturing plants, but Brazil
is the most highly industrialized if judged by the number of
workers and the value of output. Besides, it possesses the most
advanced research and technology. However, Mexico, Argen-
tina, Chile, and Colombia have higher per capital production of
manufactured goods. The chief manufactured products are
food, beverages, tobacco products, textiles, and clothing, which
represent about 60 per cent of the total manufacturing produc-
tion in Argentina, Brazil, Chile, and Mexico, and some 70 to
80 per cent of the production of the other countries. The chem-
ical and building materials industries are expanding rapidly in
some areas, as are the paper and pulp industry, the pharmaceu-
tical industry, and especially the textile industry. Four of the

xviii The Caribbean
Latin American countries-Mexico, Argentina, Chile, and Brazil
-have integrated iron and steel plants, and Colombia will have
one in 1954.
Manufacturing in some of the countries has been limited by
the lack of electric power. Dr. Wythe states that although the
power industries in Latin America have expanded since the
Second World War at an annual rate of about 10 per cent, the
demand for electricity has increased even more rapidly. Ap-
proximately one-third of all of the International Bank for Re-
construction and Development and Export-Import Bank loans
between 1947 and 1952, amounting to 330 million dollars,
were for power development in Latin American countries.
To assist many of the countries in their internal economic
development, the United States Government since 1938 has pro-
vided funds and personnel on a generally expanding scale to
carry out technical and scientific assistance programs. This has
involved the training in the United States or in the recipient
countries of large numbers of persons in the fields of aviation,
weather forecasting, seismography, geology, statistics, fisheries,
child welfare, education, and public administration. Coopera-
tive projects have been carried out in the fields of health, agri-
culture, and industrial training. During the last war especially,
technical assistance included aid to improve transportation, to
expand food production, to improve health and sanitation, and
to develop productive capacity of industry, mining, and agricul-
ture. Private United States industries have engaged in a notable
effort to train both United States citizens and Latin Americans
in special work for their companies.

VII
Labor has made important gains since the First World War.
The growth of industry in some Latin American countries has
caused a demand for women workers. Local labor organizations
and international labor organizations have stimulated interest in

EDITOR'S INTRODUCTION

xix

legislation for laborers and their improvement generally. Today
most of the countries have compulsory insurance for old age and
industrial injury. Schools and hospitals are provided for labor.
Also in most countries there are laws for minimum wages, lim-
ited working hours, and guaranteed holidays. The arbitrary
discharge of workers is generally discouraged by law. However,
labor unions are still politically controlled and are often kicked
about by the government.

VIII
It is evident that Latin America is still an economic laboratory
where new advances are being made by explorers, experimenters,
and promoters. Each new advance in economic activity opens
new vistas of economic life. Economic progress is generally con-
stant, though because of uneven distribution of natural resources,
population patterns, political policies, and other influences, it
proceeds at varying rates in different areas. Taken as a whole,
the picture of progressive prosperity in the Latin American
countries is hopeful. Comparisons between the Caribbean region
and the remainder of Latin America need not be discouraging,
as is amply shown in this volume by the eminent authorities who
analyze the problems of the Caribbean area. Throughout Latin
American life the stream of economic history is flowing steadily
along a clearly marked course, despite the occasional shoals of
political adversity. As a tributary of this main stream, the Carib-
bean region is moving rapidly toward the common economic
objective of all of Latin America and toward a better economic
life.
A. CURTIS WILGUS, Director
School of Inter-American Studies

Part I

INTRODUCTION

1

John M. Cabot: CONTEMPORARY FORCES
AT WORK IN THE CARIBBEAN TODAY

IN THE CARIBBEAN AREA, as in every other part of the
world, we face the implacable challenge of Communism. If in
general we are meeting it successfully in this area, Communism
has nonetheless established one center of infection, and there
are some circumstances which favor its spread elsewhere. From
the viewpoint of our national security, there is practically no
area which is more vital to us. When we think of the cold war,
let us not think only of the far-flung front lines on the Elbe, in
the Caucasus, about Hanoi, or north of the 38th parallel where
our forces so recently threw back Communist aggression. The
Caribbean region is our innermost defense area against the enor-
mous totalitarian threat we face and must continue to face.

I

What is the substance of the Caribbean area? Some twelve
independent republics and several European dependencies. On
the mainland a Spanish civilization superimposed on an Indian.
On the islands, including the dependencies, a Spanish, French,
English, and Dutch civilization on a more or less broad Negro
base. Histories older and more romantic than ours; exotic cul-
tures with colorful Indian and Negro influences resurgent be-

4 The Caribbean
neath the long-prevailing European domination, economics based
on the produce of tropics and mines; governments which, owing
to their defects and difficulties, have been unable to satisfy their
people's needs; a history of instability, foreign interference, back-
wardness-but of aspiration to better things. The unrest caused
by those aspirations is the key to the Caribbean story today.
We should not fool ourselves that Soviet Communism was the
major force which produced that unrest. We ourselves were
primarily responsible. On the remotest shore of these sparkling
seas the most ignorant peon was aware of our wealth, our power,
our impact on his life. To him we brought such new ideas as
equality before the law, individual freedom and dignity, educa-
tion for all, a fabulous standard of living for the masses; and we
distributed these ideas in his feudal society by such typical Amer-
ican vehicles as the auto, the movie, the radio, the airplane.
Through our businessmen developing the resources of the Carib-
bean region, the same unspoken message reached the people.
When there are great disparities between rich and poor in a
community, there is not likely to be much understanding between
them. Neither seeks to analyze the other side with understanding
and compassion. Great disparities exist between the power and
wealth of the United States and that of most of the Caribbean
republics, and equally great disparities exist in the living stand-
ards of individual citizens. These disparities have had very
marked repercussions on relations in the Caribbean area.
If we had not invariably respected the rights and interests of
the Caribbean republics as we do today, we did sympathize with
our neighboring sister peoples in their desire to win and maintain
their independence. We did help them with material aid on
several critical occasions when they were threatened with foreign
domination. We helped win Cuba's independence with our
blood, and we have now given Puerto Rico the full autonomy
they themselves have chosen. We never sought to take advan-
tage of the weakness of our small neighbors to annex them as
colonies.

INTRODUCTION 5
Unhappily, independence is not enough. On the one hand,
national independence did not mean individual freedom, as the
Caribbean republics quickly discovered; on the other, with na-
tions as with individuals, independence is inseparable from a
sense of responsibility. Those factors basically have molded the
history of the Caribbean republics since they won their inde-
pendence; as never before, they pose the basic question today.
Throughout the area social conditions were still feudal when
modern influences began invading it: a small upper class of
landowners, soldiers, prelates, politicians, to whom a few native
and foreign businessmen had but recently been added; an almost
nonexistent middle class; and great masses living in abject pov-
erty and virtual peonage. The gap between the Spanish descent
of the upper classes and the Indian or Negro origins of the
masses added to the explosiveness of the mixture. Though not
lacking in natural resources, they were almost totally lacking in
native capital. They lacked roads, railways, utilities, industries,
and even the major staple exports which, directly or indirectly,
would bring the capital for their development.

II

Into this Arcadian society foreign capital was attracted by the
opportunities it afforded and the deliberate policies of the local
governments. It developed railways, mines, sugar production,
utilities, banana plantations, oil. If it had no more fully de-
veloped social sense than had capital in Europe and in the
United States at that period, it generally behaved not worse, but
better, than the prevailing standards in the countries to which it
went. In particular, it commonly found that to attract labor to
distant, desolate places it had to pay better than prevailing wages
and offer better than prevailing working conditions; and in its
own interests it often had to provide hospitals, housing, and
schools. It developed the jungle and the desert; it produced im-

6

The Caribbean

portant exports; it built the railways and utilities which thereto-
fore had been almost totally lacking and which many of the
Caribbean peoples would scarcely have had today if they had
had to depend on their own resources. If most of the Caribbean
republics are still relatively poor, it is to be remembered that they
started far worse off than they are today, and that their progress
has been increasingly rapid.
These massive injections of foreign capital into hands thereto-
fore almost totally devoid of capital also produced grave prob-
lems. The governments were weak, unstable, often venal; the
mass of the people had a long record of submission to authority.
Because of the risks and the scarcity of capital, high returns on
it were normal, and in the prevailing circumstances unsavory
deals by no means unknown. But the introduction of large for-
eign capital investments brought in new factors. Their Very size
gave them a vital position in the countries' economies; and, giv-
en the political, economic, and ethical conditions prevailing in
the Caribbean area at that time, they could scarcely have
avoided using their financial power for their own ends even if
they had wished to do so. Moreover, this capital was backed by
powerful foreign governments; those governments were by no
means loath to use force to protect it, and in fact numerous
foreign interventions occurred. If these were often provoked by
the despoiling of foreign capital, they were sometimes merely
the pretext for imperialist adventures. American capital had a
better record than European capital in this regard, perhaps in
part because it entered the field later.
Recognizing the dangers of extracontinental intervention to
the Monroe Doctrine and the excuses for it afforded by disorder
in the Caribbean area, Theodore Roosevelt in effect announced
during his administration that the United States would see to it
that order was maintained in the Caribbean area; and there-
after a series of interventions was undertaken to re-establish order
and inculcate democracy in several of the Caribbean repub-
lics. Our efforts to impose democracy were notably unsuccessful,

INTRODUCTION

as we should have foreseen from the very nature of democracy.
The principal effect of our well-intentioned efforts was to stir up
a hornet's nest for us throughout Latin America. Finally, at
Montevideo in 1933 we solemnly agreed not to intervene in the
internal affairs of our sister republics, and we have scrupulously
respected that pledge since that date throughout the area which
we are discussing.
Into this unbalanced, rapidly developing situation American
ideas increasingly thrust themselves. These ideas, which we ac-
cept for ourselves today without a single thought, were as revolu-
tionary in the conditions existing in the Caribbean area as they
were for us in 1775. The masses did not stop to think out to a
nicety the equities of each case; they had no long democratic
tradition to temper and guide their emotions; they had no demo-
cratic processes to enable them to get what they thought they
should have by peaceful means, and in remedying abuses they
made many mistakes.
By no accident Mexico, as our closest neighbor and the coun-
try of greatest extremes, flamed into revolution in 1911. In the
following events, we again learned the unwisdom of interfering
in our neighbors' affairs. Today a transformed Mexico is among
the most progressive and prosperous of the American republics,
and to that prosperity massive infusions of United States capital
have contributed importantly. In recent years, moreover, no
other country in the Caribbean area has had a record of greater
political stability.

III
Today we face in many Caribbean lands movements which
have some similarity to the Mexican revolution-and which also
have fundamental dissimilarities. We should never fail to recog-
nize the sound impulses which seek change, betterment, or real
national identity in that area, and we should never try to block
these forces insofar as they are wisely directed. But today there
is another force working overtime in the Caribbean region-the

8

The Caribbean

force of that modern colonialism, Communist imperialism.
Communism has nothing to offer people in the Caribbean
area except false promises. It will not-it cannot-bring better
living standards to the common man anywhere. By robbing the
foreign investor it could give the workman a bit more for a short
time-and destroy his job. But those in the Caribbean area who
listen to Communist agitation should remember the Communist
record in the countries they control-the long, sad tale of ex-
ploitation and forced labor and concentration camps and living
standards lower than they were when the Communists seized
power. Even in the eighteenth century, unbridled exploitation
was not well regarded by Europe-note the trial of Warren
Hastings. No colonial power has ever exploited the people of
its colonies as the Communists exploit their own people. How
many voices are raised today in Soviet Russia to defend the
rights of slave laborers?
Let us nevertheless not deceive ourselves as to the allure of
Communist propaganda.
The present generation in our neighboring republics has for-
gotten what conditions were like before foreign capital came in
to provide them facilities, employment, and exports. Many of
them have no appreciation of what it means to them and to
their countries' progress. The Communists seek to exploit the
unthinking emotions of the still-backward people. They know
that in no other area of the world has a great power shown such
respect for the rights of weak neighbors as has the United States
for the smaller Caribbean republics. They know that in no
other area have such diverse nations cooperated more harmoni-
ously for their mutual benefit. They see Caribbean living stand-
ards rising day by day, aided by expanding, profitable trade, by
increasing private investment, by our effective Point Four work,
by the basic facilities constructed with the aid of government
loans. Recognizing the effect which bettering conditions in this
area must have on the plans to dominate the world, they attack
where they think attack will be most effective.

INTRODUCTION 9
Hence the vicious propaganda against American companies
operating in the Caribbean area. By their attacks the Commu-
nists seek, of course, to discredit the United States. But they have
other objectives, too. They want to prevent the development of
these republics and the improvement of living standards in them,
and they know that increasing foreign investments will endanger
their objectives. They seek to turn the Caribbean nations against
foreign investment, and foreign investors against the Caribbean
nations. But if in one Caribbean country a misguided govern-
ment is dancing to their tune, in all the other independent coun-
tries they have little enough to show for their efforts.
If political problems arise in the Caribbean area, we have
evolved a set of principles peculiarly well adapted for dealing
with them. So long as we follow those principles in endeavoring
to settle our differences, the latter should never become serious.
In short, these principles are respect for the rights, interests, and
individualities of our sister republics, nonintervention in their
internal affairs, and cooperation with them in developing their
resources, basic facilities, and living standards.
There is, however, a word which I should like to add to that.
We expect of our sister republics the same consideration that we
strive to show them. Weakness does not confer rights on a na-
tion; and rights cannot be divorced from responsibilities. We
have gladly recognized that our sister republics have attained
maturity. In the last few days we have again demonstrated that
we do not wish to dominate any other people, by announcing
that this administration would recommend to Congress that
Puerto Rico become completely independent if it so chooses.
But we do expect from our sister republics a due regard for our
views, rights, and interests in return.

IV

The fundamental problems of our Caribbean relations are not,
then, the question of Cuban sugar or Panama Canal treaties or

10

The Caribbean

expropriations in Guatemala or migrant labor from Mexico.
With due consideration on each side for the other's viewpoint,
all of these can be solved. The fundamental problem is that, in
a narrowing world, smaller, weaker, poorer countries exist so
close to us; that their people are increasingly anxious to have
for themselves the good things of life they see their neighbors to
the north enjoying; and that the Communists are striving to get
them to choose unwisely, even wrongfully, the means of securing
them. If our policy is to thwart them, we prefer to think of the
problem facing us in more positive terms. It is not enough to
analyze it, to appreciate the difficulties we face and to talk in
generalities of the objectives we should seek to obtain. We need
a concrete, constructive program to attain those objectives.
The objectives are clear. We want in our relations with our
sister republics of the Caribbean to promote peace, mutual secu-
rity, democratic practices, rising standards of living, and economic
development. We seek their friendship based on understanding,
cooperation, and mutual respect.
The means by which we seek to obtain these objectives are
primarily the following:
(1) An expanding trade promoted by stability in rules and
terms. Since we produce practically none of the staple export
products of the Caribbean countries in adequate quantity for
our domestic consumption, and since indeed our products tend
to complement rather than to compete with each other, this is
a serious problem today only in restricted sectors.
(2) The continuing investment of American private capital
in those countries favoring such investment. Men cannot have
what they do not produce; capital tools help men to produce;
native capital in the Caribbean is woefully inadequate to fill the
area's needs and, therefore, additional foreign capital is needed
to raise living standards rapidly. That capital will go only
where it is welcomed and fairly treated. The money invested by
our private citizens is bettering wages, working conditions, hospi-
tals, and schools, is expanding vital exports, is providing know-

INTRODUCTION

11

how to more and more people, and is enabling people to buy
better merchandise at cheaper prices.
(3) Government loans to aid in the construction of basic
facilities such as roads, utilities, irrigation, and in the develop-
ment of agricultural resources.
(4) Direct aid for such major mutually beneficial projects as
the Inter-American Highway.
(5) The dissemination of know-how through scholarships,
trainee grants, American libraries, and through our Point Four
work.
I should like particularly to emphasize how much we get for
every dollar that we put into Point Four work. I have seen with
my own eyes how it is increasing agricultural production and
thereby helping the people of the Caribbean area to eat better.
Agricultural yields have in some instances been multiplied several
times; and, to pick but one example, Costa Rica, which used to
import corn, beans, rice, and sugar, is now exporting all of them.
The scourges of malaria, yaws, and other pestilences have been
virtually eliminated. Pure water has been brought to many
villages which never knew it before. Clinics, hospitals, and
trained nurses attend to the medical needs of a populace former-
ly without them. Here is the refutation of the oft-repeated story
that our aid does not reach the common man, for millions
throughout the Caribbean area have benefited from it.
Even if the means at our disposal were greater, we should not
quickly attain our objectives. What we are doing is to build
slowly but truly the foundations upon which the nations of the
Caribbean area can rise in future majesty. We are at times
criticized for not doing more to promote democracy now. I
have already mentioned how notably unsuccessful our direct
efforts to promote democracy have been. To my mind, the
proper and the surer way-if at times its slowness makes us im-
patient-is the course we are now following. By raising living
standards, by creating a middle class through trade and economic
development, by promoting education through Point Four aid,

12 The Caribbean
by the very example our democracy sets for our sister republics,
we shall in my opinion set them in their turn on the path to
democracy, without improper interference on our part.

V
If I have spoken at length of the social forces working in the
Caribbean, I do not wish to overemphasize their explosive na-
ture. Although Communism has established a beachhead in one
republic (and has recently been smacked down in an effort to
establish another in a European colony), other Caribbean repub-
lics are without exception progressing rapidly through stable
evolutionary processes. Already the Red Star has clearly passed
its zenith in Mexico, Cuba, and some of the other republics.
While complacency would be unwise, we can be quietly confi-
dent in the progress we are making and we can devote increased
efforts to the sectors in which the battle is still not going as well.
That is the message of encouragement and exhortation which I
wish to bring you today.
For Communism will not be beaten by oratory. It will be
beaten when the underprivileged-and there are still many of
them in the Caribbean area-are convinced that while Com-
munism rants, democracy produces the goods. Let us go for-
ward, confident in our strength to meet the tasks before us, in
the soundness of our principles, in the values, spiritual and ma-
terial, which our way of life has to offer our sister nations. Let
us continue to cooperate with them in friendship and trust, to
thwart the efforts of a new imperialism to make colonies of us
all.

Part II

RESOURCES AND PRODUCTION

2

Carl 0. Sauer: ECONOMIC PROSPECTS
OF THE CARIBBEAN

THE AMERICAN MEDITERRANEAN is one of the chief
crossroads of the world, second perhaps only to the Near East.
This is an elemental and permanent fact of position of sea and
land to which different times may give different value and ex-
pression, but which no political or economic pattern of the world
can diminish in the long run.
Our own Middle Atlantic seaboard became important three
centuries ago as the opposite and colonial shore of northwest Eu-
rope, and it has continued to depend mainly on the business
crossing the North Atlantic. In the not-too-distant future, south-
ward communication, across climatic belts through the West
Indies and along them to South America, may take first place in
the commerce of our eastern ports.

I. Advantage of Position
Middle America, by mainland corridor and island stepping-
stones, as well as through its sheltered seas, links the two Amer-
icas. Between its island guards and across the isthmuses of its
mainland passes must pass, in the future, the main traffic be-
tween Atlantic and Pacific. Florida, Panama, and Trinidad
bound the strategic triangle of the New World; it is not by
chance that these have become world centers of air lanes.

15

16

The Caribbean

These large features of our globe are so salient that they must
never be overlooked. They have operated in the geologic past
in the dispersal of plants and animals. This history of man in
the New World-aboriginal, colonial, and contemporary-is a
series of solutions of the tactical positions and interior lines of
this area as lying between the two continental Americas. Lately
we have become aware of the superior transport position and
strategic implications of the great and critical mineral resources
lying within the Caribbean rim-petroleum, bauxite, and iron
ore-as affecting the industrial future of the New World.
Man always economizes expenditure of energy and so his as-
sembly points grow up where the assembly costs are least, his
busiest routes of trade involve the fewest ton-miles. The more
commerce draws upon the ends of the earth for primary materi-
als, the more advantage accrues to the most central locations.
Middle America has such distance-saving position, on which
routes converge from all quadrants; in particular, the cheap
routes of the sea, the fast ones of the air.

II. Energy Resources

On the Lesser Antilles the ruined towers of windmills recall
the days when the trade winds were used to perform the labor
of grinding cane. At the same time, wherever cane was grown,
the woods were heavily depleted for boiling the cane juice. The
modern fuel era began in the nineteenth century with imported
bunker coal, and in the twentieth has shifted to fuel oil. The
greatest proved oil districts of the New World are at the north-
ern and southern rims of our Mediterranean, between the Mis-
sissippi and Panuco rivers, and along the southern shores of the
Caribbean. Low-cost fuel oils are available on short hauls by
pipe line and tanker-perhaps the cheapest and most flexible of
all means of transport-to island and Central American shores,
where nature has made generous provision of natural harbors,

RESOURCES AND PRODUCTION

17

beyond the necessities of commerce.* The processing of primary
materials, the growth of service industries, and facilities of com-
munication within the Caribbean area are not held back by
transport cost of introduced fuels, nor will they be so long as
these major oil fields last.
Cane bagasse is probably, at the moment, in first place as
energy source for the islands. Hydroelectric energy is available
in largest amount from the rainy mountains of the Dominican
Republic, where economical hydro-power stations are now func-
tioning.

III. Harvest of the Sea

The harvest of the sea is nearly abandoned. The salt pans on
which the North Atlantic fisheries once depended are gone, ex-
cept for a little salt still made on Turks and Caicos Islands. The
pearl fisheries along the semiarid coasts of the Caribbean main-
land became devastated very early and have not been restored.
In aboriginal days, the land provided man with carbohy-
drates, the sea with proteins. The manati, or sea cow, weighing
up to a ton, furnished superior meat to the Spaniards. It was
declared to be fish by the Church and thus proper for meatless
days. The water pastures of the stream mouths where once it
fed in large numbers were gradually depopulated, and are today
unutilized by man.
The great herbivorous green turtles were a mainstay of Indian
populations, produced in such abundance all about the West
Indies as to provide for many years the chief flesh food of the
black slaves. Fleets of turtlers were engaged the year around
out of Jamaican harbors for the provisioning of the plantations.
When the Jamaican waters were exhausted, these fishing vessels
operated on the keys and shores of Cuba and the Caymans. A
few Caymanian vessels continue the business to the present, no

Especially of ria-type, deep, narrow drowned river channels.

18

The Caribbean

longer in home waters but along the wilder shores of Central
America. The former common food of slaves has become a
delicacy of luxury markets in the United States, the turtles being
shipped to our urban markets by air freight.
The green turtles have been depleted by the practice of catch-
ing them while mating, by taking females when they come to
shore to lay eggs, and by stealing the eggs. Protection might be
had for beaches still visited by sea turtles. As the situation
stands, they are rapidly going the way of the manati. A con-
servation policy for the resources of the sea would not be diffi-
cult to draw up, but would be difficult of acceptance because of
the many political jurisdictions and interests. None has been
tried; as a result, the plankton-rich areas of the Caribbean and
Sargasso seas are not being utilized beneficially by man.
A further difficulty is that most of the present inhabitants
know nothing of fishing as a means of livelihood, excepting the
colored folks of the Bahamas and the Cayman whites. Thus,
even where sunlit shallow banks afford superior fishing grounds,
as about most of Cuba, sea food is scarce and expensive. It is
likely to cost more than beef, and it may be imported from the
United States.

IV. Cropping the Tropical Forest
The islands have more people than the whole of Canada.
Need of tilled land has caused the removal of most of the forest
cover, except from the steeper mountain slopes. The Dominican
Republic, with least pressure of population, has most forest left.
Neither on islands nor on Caribbean mainland is effective at-
tention given to trees as a permanent resource, except perhaps
by the United Fruit Company. The Caribbean pine of the low-
lands, nearly related to our Southern slash pine, has been almost
wholly cut out in Cuba. It is now also being cut heavily on
the mainland, from British Honduras to Nicaragua, mainly for
export. The highland pines, being less accessible, have been less
invaded, but logging roads are now being pushed into the moun-

RESOURCES AND PRODUCTION

19

tains throughout the island of Haiti. Watershed protection is
thereby being lost where it is greatly needed. The valuable
cabinet woods have been logged out earlier. Tropical cedar
(Cedrela), mahogany (Swietenia), and blond mahogany (Ta-
bebuia) are being priced out of the market by their growing
scarcity.
Both cabinet woods and pines have been cut with little
thought given to what becomes of the land afterward. The
pine lands in many cases are of low fertility and little suited to
agriculture or even to pasture. Reforestation is warranted com-
mercially in many localities, especially for cabinet woods. These
are natives of the rain forests in which trees, to succeed, must
grow tall, straight, and fast. The mahoganies and tropical
cedar may make saw logs in as little as twenty to thirty years,
and they establish themselves readily because they seed freely
into clearings. Given simple management, the highly diverse
rain forest may be simplified into stands dominated by the fine
species. Queensland has introduced these Central American
trees successfully into forest plantations; in their native home
they are in process of being destroyed, but might be increased
as a valuable and permanent resource, especially on the Central
American mainland.
The once-important industries of cutting dyewoods, collect-
ing aromatic resins, gums, and drugs have given way to the
laboratory products of the organic chemist. There may be a
modest place in the future economy for some of these woody
plants. A little cash income to supplement subsistence farming
is a sharply increasing need of the growing and often unem-
ployed populations. For many of the people it is not a question
of how much they can earn, but whether they can earn anything.
Possibly, with some aid in marketing, some of these products
can compete here and there with those of the chemical and
pharmaceutical factories. Perhaps there is a valid customer
preference for some natural flavors, perfumes, and cosmetics,
as against the products of coal mines and gas wells. Perhaps

20

The Caribbean

some plants synthesize certain compounds better than do the
laboratories. Perhaps applied science is thinking too exclusively
in terms of large enterprise.
The native economy depends in numerous ways on trees and
shrubs and will continue to do so because they may be most
useful and least expensive. (1) I neither think nor hope that
the functionally admirable native house, the bohio, will give way
generally to concrete-block construction and roofs of tin or
aluminum. The palms that provide so characteristic an accent
to Caribbean landscapes do so because they are good primary
structural and household materials: the fanleaved sabals for
their excellent thatch, the corozos, split into thin strips that serve
as weatherboarding, as well as for their fruits used as mast, the
chontaduras, termite-resistant, for house posts and frames. (2)
Postes vivos, living fences continue to be preferred because they
are not subject to termite attack and wood rot, and serve ad-
mirably and inexpensively in enclosure of field and garden,
yielding also a variety of fruits and other household items. (3)
Commercial fuels and the expensive stoves they require cannot
replace firewood and charcoal where people live at minimal
income levels. We of the North, living in easiest circumstances,
need awareness that our neighbors to the South have made most
sensible adaptations of resources to severely limited economic
capacities. We need to use caution in urging the transfer of the
pattern of our commercial culture into situations that must
remain very different from ours.

V. The Conuco as an Economic System
The native Indian crops were a varied lot of high-yielding
roots or tubers, yucca, or cassava, sweet potatoes, yautia or
malanga, arrowroot, certain yams, peanuts, and, I think, plan-
tains. These, with fruits such as of palms, pineapple, and mamey
gave starches and sugars in plenty, as well as greens. Corn,
beans, and squashes were of secondary importance. Plant pro-

RESOURCES AND PRODUCTION

21

teins were few and little required since sea food was abundantly
taken. The diet was ample, balanced, and varied. When Indians
gave way to Negro slaves, the latter took over for themselves,
rather than for their masters, the cultivation of the Indian crops,
and added thereto such African things as the greater yam, the
pigeon pea or guandul, okra, and the keeping of fowls. In the
Spanish and French colonies of the Caribbean, these Indian
and African foodstuffs and ways of preparing them passed
gradually into the kitchens of their masters and became the
creole cooking of the present. In the English settlements they
remained mainly the provisions of the colored folk. The island
of Haiti, both on the Spanish and French side, still grows about
every plant described by Oviedo when he first informed the
Europeans of the crops of the Indies. In the Dominican Re-
public, these provide abundance; on Haiti, they make possible
survival. Cuba, largely resettled only in late years, knows and
uses the fewest root crops.
The food potential of the traditional conuco planting, or pro-
vision ground, is hardly appreciated by ourselves, be we agri-
cultural scientists, economists, or planners, because its tradition
as well as content are so different from what we know and
practice. Yields are much higher than from grains, production
is continuous the year around, storage is hardly needed, indi-
vidual kinds are not grown separately in fields but are assembled
together in one planted ground, to which our habits of order
would apply neither the name of field nor garden. And so we
are likely to miss the merits of this system.
The proper conuco is, in fact, an imitation by man of tropical
nature, a many-storied cultural vegetation, producing at all
levels, from tubers underground through understory of pigeon
peas and coffee, a second story of cacao and bananas, to a
canopy of fruit trees and palms. Such an assemblage makes
full use of light, moisture, and soil-its messy appearance to our
eyes meaning really that all the niches are properly filled. A
proper planting of this sort is about as protective of the soil

22

The Caribbean

as is the wild vegetation. The conuco system can make intensive
use of steep slopes and thereby may encounter erosion hazards
that should not be blamed on the system itself, as commonly
they have been. Nor do I see chances of success for pulling down
by decree the ever-crowding populations from their hillsides.
Its commercial disadvantages are that most of the things
produced are difficult to store and ship, that it is best suited to
the small producer, and that it resists mechanization. However,
no field agriculture can match it in over-all productivity and
continuous production. It is the best way of subsistence agri-
culture and of support for increasing numbers of people. Cacao
and coffee fit well into conuco culture, can be satisfactorily
marketed by small producers, and add cash income to self-
sufficiency in food. The Dominican Republic offers especially
good illustrations of peasant subsistence at a good level, with
cash items from cacao, coffee, peanuts, and tobacco. A major
obligation of agricultural science and economy will be to learn
the merits of the native systems and aid them by discovering,
developing, and distributing superior kinds and races of plants.

VI. A Permanent Place for the Plantation
A good word is next in place for the plantation system which
came as naturally to the West Indies as did the industrial revolu-
tion to the English Midlands. It has dominated our area for
three centuries and, despite its critics, seems to have life in it
for quite a time ahead. It is the classical model of the factory
farm that is now making such inroads on the family farm system
of present-day United States. The plantation has had a very
bad press ever since people developed a conscience about slavery,
but it has a well-reformed character and hardly deserves to be
the whipping boy it often is for politicians, unless one is con-
sistent in decrying all industrialization.
Sugar was the earliest and still is the first product of the
plantation. The sugar cane is not only the most effective pro-

RESOURCES AND PRODUCTION

23

ducer of sugar, but its toll on soil fertility is relatively low
(especially as to nitrogen and phosphorus), the energy demand
in tillage is low, and this giant grass forms a superior ground
cover against surface runoff.
That there is at present overproduction of sugar is true only
because of political restrictions. Sugar entered world markets
as a luxury and was immediately levied upon for the support
of treasuries. Window and salt taxes have disappeared, but
sugar is still in nearly all countries subjected to a variety of
special taxes, direct and indirect. No other commodity has
been entangled so long and so deeply in mercantilistic controls
and manipulations.
There is no way back from the large sugar factory, or central,
to small processing units except at increased cost of the product.
Optimum size will be determined by cost sheets, and these
register the disadvantage of small factories and plantations.
Much the same is true of banana, pineapple, and tropical fibres
for world markets. Size is self-regulating in industrial compe-
tition, and the present direction is toward larger units. Bigness
is no more bad in sugar or bananas than it is in shoes or auto-
mobiles. If the Caribbean is to prosper in access to world
markets it has to produce attractive goods at attractive prices.
No one has discovered anything for the area equal to its planta-
tion products, for which it has real natural advantage.
I think there is nothing seriously wrong with the cane-sugar
business except a heavy incrustation of political interventions,
external and internal. The gradual reduction in late years of
the role of American capital in the over-all industry is tactically
to the good, since it diminishes the national sensitivities to foreign
domination. Except for the inflow of American capital, ulti-
mately from the savings of very many individuals and not from
some mythical money colossus, the sugar industry and the in-
ternal improvements of Cuba, Puerto Rico, and the Dominican
Republic would largely not have been achieved. Scores of
millions of dollars in such investments have been written off,

24

The Caribbean

again mainly at the expense of citizens of the United States, in
the forced reorganizations during depression years, mainly in
the 1930's. The industry is now operating on valuations greatly
below actual cost and even more so below replacement costs.
The investment in and valuation of centrales, railroads, ports,
power plants, and housing and the necessary accumulation of
working capital are far in excess of that in lands and crops.
For one of the largest corporations, for example, producing
mainly from administration-grown cane, the land represents
about one-third of the physical property, and one-sixth of the
total investment at current book value. The record of American
management is good as to wages, housing, sanitation, and health
services. We ought to stop being apologetic about the role we
have held as fair, and even generous, partners in the economic
life of the Caribbean. It is in the common interest that this
partnership be maintained and developed into the future, with
mutual growth of understanding and good feeling.
The sugar industry is admirable technically in its extraction
of raw sugar, but the utilization of by-products has made less
headway. I am inclined to think that in part it is not technical
but psychologic blocks that are in the way, the big gains or
losses that a minor price change on the sugar market brings, the
exhausting tension of the grinding season, the priority making
the sugar zafra has over everything else. A central will carry
to the mill hundreds of thousands of tons, even a million or
more, of cane within a few months, a tenth to an eighth of
which will become raw sugar. The residual molasses is a fourth
or somewhat less of the sugar tonnage. The remainder of crushed
stalk, or bagasse, is the fuel by which the central operates, which
also may provide electric power to be distributed to towns round
about. This admittedly may not be the most economical con-
version of the great mass of residual organic matter, but it is
always available and is tax free, which imported fuel oils may
not be. The potash-rich ash in some cases is returned to the cane
fields.

RESOURCES AND PRODUCTION 25
The disposal of the great flood of blackstrap molasses is a
chronic dilemma, which has grown worse now that industrial
alcohol is produced more cheaply from natural gas and petro-
leum. The industry has shown little initiative in helping the
use of molasses as stock feed. Indeed, the Cuban common
distributing agency has priced molasses lower to purchasers for
industrial alcohol than it has to buyers for feed. Its cheapness
and high feed value for cattle, hogs, and poultry has long been
well known. The difficulty has been in handling the sticky stuff,
especially to and at the farm. It may be that this problem is
at last being solved and that a large, dependable, and profitable
market is opening overseas.
The economy of the sugar islands is under seasonal strain by
reason of the long dead season, when there is little employment
either in cane fields or central. However good the wages during
employment, they are likely to have been spent before the
beginning of the next zafra. Obviously this may suggest a possi-
bility, still virtually unexplored, for off-season employment in
light industries, such as small factories making work clothes,
shoes, and the like, for which we have successful examples in
many small towns of the Middle West. The efforts both by
companies and government to get the sugar workers to produce
their own food rather than to buy everything at the stores are
not new and are continuing. It is not that the workers cannot
have land to plant but that they are really not farmers or peas-
ants, and are accustomed only to work for wages. In the Cuban
sugar areas, for example, native provisions and fruits are woe-
fully wanting, and California rice and fruit juices, as well as
Midwestern flour and meat are staples in rural stores. This
uneconomic situation rests on social habit rather than on denial
of opportunity.

VII. Tropical Pastures
The Caribbean lands have immediate, and in part long-range
opportunities in livestock. We must not forget that the New

26

The Caribbean

World was stocked with cattle and hogs via Hispaniola, where
the Spanish colonists had found that all forms of livestock thrived
exceedingly well. In the old plantation days, cattle were im-
portant on most estates, and cane tops and leaves were fully
used as feed. The nineteenth century saw the introduction of a
series of valuable African forage grasses that naturalized readily.
Colombia has well shown that the tropics may have superior
advantages for growing livestock. Lately, a number of sugar
companies, in particular in the Dominican Republic, have
become meat and dairy producers in a large way, feeding cane
waste and rotating cane fields with pasture. Molasses is at hand
to be added to local feed. Nitrogenous feed is still short, but
the American tropics are perhaps the foremost area in the
world in diversity of nitrogen-rich leguminous plants. We have
hardly begun to look into their potentialities because we are
accustomed to the clovers of the high latitudes.

VIII. Sum of Prospect
There should be moderately good days ahead for the Carib-
bean lands, or for some of them. I can see little prospect for
the sadly crowded islands, unless they stabilize their populations,
nor do I know how that may be done. Emigration never is
more than momentary easing of population pressure. The world
as a whole is no longer receptive to immigration. The wistful
hope for tourist dollars cannot be realized by every spot that
lies in beauty upon the Carib Sea.
By sum of position, climate, and soil, these are about the
world's best lands for sugar, bananas, pineapples, cacao, and
other tropical fruits. Such should remain the major source of
cash income, properly divided between worker and the always
necessary venture capital, for such operations require large
enterprise. Nowhere is a climate of international and internal
good will and respect more needed and the voice of the dema-
gogue more mischievous. Sugar, at the moment once again

RESOURCES AND PRODUCTION

27

beaten to earth, will rise again; for the political follies of the
past will not all be repeated, and new consumer demands will
come.
There are important possibilities in conuco planting, given
some helping hand by science. This system makes the most
intensive and balanced use of the soil, and it gives work to most
hands. Also, it is well, perhaps best suited to certain commercial
products such as cacao, coffee, and peanuts. In parts, a per-
manently valuable tropical-forest industry can be developed.
In others, the raising of cattle and hogs has superior attractions.
A good ecologic balance of culture and nature is attainable
without upsetting either by prefabricated action programs, with
or without doctrinal blueprints. We neighbors of the North
do not need to think that we can, or even should, supply the
know-how. There is a lot of experience and ability below our
borders, from which we may learn and to which we may perhaps
join ourselves as associates.

3

Wilson Popenoe: AGRICULTURAL ENGINEERING
IN THE CARIBBEAN

AS AN OBSERVER of agricultural development around the
Caribbean during more than a quarter of a century, I shall try
to point out some of the trends in the field of agricultural engi-
neering which seem to me significant and interesting.
To begin with, I want to tell you what I tell young Latin
Americans who come to me for advice. They say to me, "I want
to go in for agriculture. In what particular field do you think
there are the greatest opportunities?" I reply: "Agricultural
engineering. In my opinion (and I should have no bias, since
I am not an agricultural engineer), the great developments of
your generation are going to be in drainage and irrigation, and
in more extensive use of farm machinery."
In giving this advice I am not unaware of the importance of
crop improvement and of pest control (which, in a way, ties
in with agricultural engineering); I am simply trying to put
myself in the place of a young Latin American, with no par-
ticular leanings toward any specialized branch of agriculture,
who wants to get into a field with a great future. If I myself
could go back fifty years or so, and did not have the overwhelm-
ing yen to grow plants which has possessed me from childhood,
I would try to get a thorough knowledge of tropical soils, of
plant-water relationships, of drainage, of irrigation, and of farm
machinery as needed in tropical countries.

28

RESOURCES AND PRODUCTION

29

This is a pretty broad program, of course, but it is capable
of realization.

I
Let us stand back for a few minutes and talk about what
has been done and where we are going. Perhaps the simon-
pure, dyed-in-the-wool agricultural engineers may not agree that
a thorough knowledge of tropical soils is basic. But what is
more basic in the whole field of agriculture than a sound knowl-
edge of soils? And how much do we know about tropical soils
in general? Not enough, by any means. We need more studies
like the one made years ago by Bennett and Allison in Cuba.
Ask any intelligent Cuban sugar-cane grower what that epoch-
making work has meant to him.
It is encouraging to see the attention being given today to
our soils. There are technicians, like Robert L. Pendleton, who
are working on the broad problems of land use in the tropics.
There are others who are making detailed soil surveys of specific
areas. The accurate mapping of considerable regions has saved
millions of dollars to the banana industry (for example) by
eliminating unsuitable lands from planting programs.
This, it seems to me, needs to be followed by more complete
knowledge as to how much water a given crop needs for efficient
growth and production, which in turn involves the problem of
how much water can be held and passed on to plants by a given
soil. I touch upon this point with fear and trembling, for it is
one which only experts should discuss. But in many regions
water is scarce or expensive, and it behooves us to make the best
possible use of it. I admit that the water requirement of crop
plants is not essentially a problem of agricultural engineering,
but the engineers have to plan for the application of water to
the land, so why shouldn't they know how much to apply?
In spite of great progress made during the past quarter of a
century, the problem of draining vast areas in the wet tropical
rain-forest zone around the Caribbean will continue to require

30

The Caribbean

the attention of agricultural engineers for many years to come.
And, it may be added, the drainage problem exists not only in
the coastal rain-forest areas. The most difficult thing about
drainage projects is that usually they must be carried out on a
large scale, which means that they must be organized and
financed by governments or companies with large interests.
If I am not mistaken, the broad techniques of drainage are
thoroughly understood by the engineers; it is only when we come
down to the drainage of localized areas that we run into the
need for complete information regarding the depth and spacing
of drains required to keep water out of the root zone of the
crop we are cultivating, and this in turn involves knowledge of
the soils with which we are dealing. The intensive investigation
required to provide adequate drainage for banana farms around
the Caribbean has occupied an amount of time and effort which
would amaze many people.
Increased use of irrigation may be the most important step
in the future development of tropical American agriculture in
general. This is a broad statement; let us see why it may be
true. In the first place, large areas of the best land have not
been utilized up to now, or have been cropped during only part
of each year, owing to lack of adequate rainfall. In the second
place, agriculture under irrigation is less hazardous than agri-
culture in regions where one has to depend upon the vagaries of
climate. Is it not likely that some of the great civilizations of
the world-for example, those of Mesopotamia and Egypt--
were indirect results of irrigation? Man was able to practice the
art of agriculture with relative security, with returns year after
year that were sufficient to give leisure for the development of
culture. This was not true of peoples living under the hazardous
conditions of tropical rain forests-hazardous with regard to
weather and handicapped by relatively poor soils.
Great progress has been made in the development of irrigation
around the Caribbean. Vast projects have been carried out in
Mexico, the Dominican Republic, and other areas-not to

RESOURCES AND PRODUCTION

31

mention the excellent ones in Peru, which country is not, of
course, in the Caribbean area. One of the most spectacular
developments-if I may call it such-is the use of overhead
irrigation in many banana-producing regions, a system which
provides what may probably be termed maximum efficiency in
the use of water. Necessity for stretching limited supplies of
water as far as possible gives this system great advantages.
Again, I think it safe to say that the competent irrigation
engineer, with a thorough knowledge of soils, drainage, and the
installation of irrigation systems, has a great future in several
of the countries around the Caribbean. Unfortunately, the rela-
tive scarcity of surface water in certain regions, such as the island
of Cuba, limits the development of badly needed irrigation.

II
Throughout the American tropics there is much talk these
days about mechanized agriculture. Tractors and more or less
appropriate equipment are more and more coming into use.
On the whole, this is unquestionably a wholesome trend. But
some of us think serious mistakes are likely to be made, here
and there. We like to talk about the old-fashioned wooden plow
to illustrate our point. Not that we think the wooden plow is
an efficient instrument for turning over the soil. Quite the con-
trary; but we think it has been the salvation of many hillside
farms because it does not turn over the soil-to any great depth
at least.
The problems in connection with mechanized agriculture
seem to be two: In the first place, where is it feasible and de-
sirable to use tractors and plows? Secondly, just what sort of
equipment is most suitable? As regards the latter, we would
point out that conditions of terrain in many tropical regions are
by no means those of the Mississippi Valley. In undertaking
to mechanize the cultivation of banana farms in several coun-
tries, it was found that the tractor-drawn plows and disc harrows

32

The Caribbean

supplied by some of the big manufacturers in the United States
would not stand up under the rough conditions and (perhaps)
less expert operation of the tropics. In recent years this problem
has been solved in large part by one or two manufacturers who
have designed equipment adapted to tropical needs. There is
at least one heavy disc plow on the market which is nearly ideal
for our purposes, and there are several types of heavy disc har-
rows. I shall not detail other items, such as combines, and the
like; there are too many of them.
But to return to the general question of mechanized agri-
culture in the tropics. It is a moot subject. Some of us think
there is a definite danger that we may go in for too much
tillage, especially on sloping lands. We like to have such men
as Hugh Bennett and William Vogt and Louis Bromfield come
to our part of the world. They point out the dangers of erosion.
They emphasize the importance of abundant organic matter in
the soil-a subject we suspect can never be stressed sufficiently.
Under the all-year-round growing conditions of the tropics,
organic matter seems to be used up much more rapidly than
in regions of long cold winters.
All in all, we suspect the immediate future of mechanized
agriculture lies principally in the flat coastal lands outside the
wet zone-the irrigated lands-and that even here we should
proceed with caution, to avoid damaging such lands irreparably
within a few short years. Fortunately, this problem is not proper-
ly one pertaining to agricultural engineering, so I can drop it and
thereby avoid letting myself in for acrimonious criticism.
It might also seem that the discussion of pest control does
not fall within the scope of agricultural engineering; but the
use of mechanical equipment for this purpose definitely brings
in engineering problems. Witness the tremendous installations
now used in the banana industry in connection with the control
of Sigatoka, a leaf disease. These require powerful stationary
pumps, each serving seven hundred acres of bananas, through
which Bordeaux mixture is piped to frequent outlets. The de-

RESOURCES AND PRODUCTION

33

velopment of these installations involved engineering problems
of the first order. The use of airplanes for dusting cotton is now
standard practice in certain regions. Portable spraying equip-
ment is utilized here and there, for citrus and other crops.

III
Finally, I should like to mention a subject which logically
should have come in for attention earlier in this brief discussion.
This is the storage of such crops as corn and beans. I will
paraphrase a favorite Biblical quotation by asking, What shall
it profit a man if he raise one hundred bushels of corn, and the
weevils eat fifty of them?
We talk much these days of crop improvement, and we cite
the remarkable job done by the Rockefeller Foundation, work-
ing in collaboration with the government of Mexico. The
production of corn and beans, per unit of land, has been in-
creased to a surprising degree; and this increase is now realized
on a very considerable scale. Similar projects, on somewhat
smaller scales, have been carried on and are being continued, in
various other countries under various auspices.
All this is not only to the good; it is excellent. But we ven-
ture to suggest that there might well be more programs under
way, looking toward the protection of these increased crops
from insect devastation. I refer to harvested crops, of course.
It is only fair to reiterate that such programs are under way,
in several countries-I am thinking of Venezuela and El Salva-
dor especially, because I have seen the grain storage facilities
that have been provided in these two countries.
Admittedly, it is not a simple matter for the government of
a relatively small country to provide the necessary facilities for
storing corn, beans, and the like in large quantities. Not all the
problems connected with such projects are those of economics;
some of them seem to be psychological in nature. But the
whole subject is one which opens up vast possibilities, and which

34

The Caribbean

merits much more attention than it is now receiving. Perhaps
more is being done, actually, than I realize, for here again I
am treading upon ground with which I am not too familiar.

IV
In conclusion, I hope that any agricultural engineers present
will take part in the panel discussion, not limiting their com-
ments to ones like that of an old chap in California who once
attended a meeting of the Avocado Society at which I was a
speaker. I had just come back from eighteen months in Guate-
mala, where I had traveled throughout the back country on
horseback, living on pretty scanty fare. I was a stripling of
twenty-five years or so, and at the end of the trip I weighed
only a hundred and twenty-four pounds. I told how I had
traveled from Indian village to Indian village, sampling the
avocados in each one, and cutting budwood of the best to send
back to Washington.
When I had finished my talk and called for questions, the
old chap rose in the back of the hall and asked, "Mr. Speaker,
just how many of those avocado pears did you eat in Guate-
mala?" Obviously, I could not give an accurate answer, but I
replied, "Oh, I suppose between one and two thousand." A
look of surprise came over his face, he shook his head. and
sat down muttering, "Good Lord, they claim that fruit is
fattening."

4

Alan Probert: THE ROLE OF MINERAL
RESOURCES IN THE ECONOMY
OF THE CARIBBEAN

M INERALS have played a significant part in the past eco-
nomic history of many of the countries of the Caribbean; and
if industrial development and progress are desirable goals, the
future of minerals in the Caribbean area will command greater
importance.

I
To introduce the subject of mining and the mineral industry
in the Caribbean, I should like to direct your attention to two
important factors that may serve as guidelines-one as a reliable
backsight, and the other as a target toward which ambitious
governments may direct their efforts.
First, prudent and efficient development and exploitation of
its mineral resources has been the major contributing factor that
has made the United States the great industrial leader among
nations. This example may well demonstrate to realistic colonial
and republican governments of the Caribbean that more intensive
study and investigation of their mineral potentials may improve
their own economic circumstances. The successful experiences
of one American neighbor should be scrutinized, appraised,
adapted, and applied by others, in their own interest. Great

35

36

The Caribbean

mineral wealth exists in the island and continental Caribbean
land areas which, with due regard for conservation and with
intelligent development, can have tremendous economic sig-
nificance to the countries involved.
A second generalization well worth consideration by Caribbean
governments is that the Western Hemisphere can, with one or
two minor exceptions, become self-sufficient in minerals in peace
or war if we are willing to meet the higher costs. Recent testi-
mony offered before investigating bodies of the Congress and
executive agencies of the United States government indicates
that the mineral raw materials essential to inter-American de-
fense are abundantly available within the limits of the Americas.
This encouraging news makes due allowance for the Caribbean
countries and what is known of their important mineral re-
sources; these are multiplied in value by proximity to United
States processing facilities, which are currently unchallenged as
the logical destination.

II
This is a favorable point at which to assess the diversity and
extent of Caribbean mineral deposits in general terms. The
commodity approach would be most useful to an audience of
mineral people, but here it seems more suitable to adhere to the
geographical-area basis for correlating mineral data with other
fundamental information. A convenient course to follow is the
clockwise route from Jamaica, around the island chain, across
the top of South America, and through Central America to
Mexico. The commodities will be mentioned without regard for
order of importance within the particular country or colony, but
mineral-poor areas and minor occurrences must necessarily be
omitted.
An outstanding example of the influence of mineral resources
on Caribbean economy is given by the newly developed baux-
ite industry of Jamaica. For decades the North American
aluminum industry has drawn the larger part of its bauxite

RESOURCES AND PRODUCTION

37

requirements from the deposits of Surinam and British Guiana;
almost half of the world's supply of bauxite originated in the
Guianas in 1952. The Caribbean proper has been the scene of
great advances in the exploration of world bauxite reserves
within the past ten years. Jamaica is the largest beneficiary of
new discoveries, although Haiti and the Dominican Republic
also have minor bauxite deposits.
Jamaica's economy has always been tied to agriculture. With
the recent investment of large capital and with governmental
approval and encouragement for the development and rational
utilization of its bauxite deposits, Jamaica has achieved an
important step toward industrialization. The over-all labor re-
quirement will doubtless be small and is currently estimated at
fewer than 1,500 workers directly employed, although through-
out the construction period employment was much greater and
contributed importantly though temporarily to the national in-
come. Three foreign companies, two American and one Ca-
nadian, have undertaken the responsibility of the new bauxite
industry. All have invested heavily in land and equipment over
a period of several years. Production has already begun, with
regular exports to the United States and Canada totaling 350,-
000 metric tons in 1952. The total estimated bauxite reserve of
the area amounts to 350 million metric tons, or nearly a thou-
sand times the quantity exported during 1952, and comprises
the largest known reserve in the world.
West Indies bauxite differs in composition from that exported
from the Guianas, upon which the North American industry
was built. It is high in iron and low in silica and more like
many European ores. Because of this dissimilarity to Guiana
ore, further investment of large sums of money in the United
States was necessary to adapt processing flowsheets to the raw
material.
The benefits to Jamaica have been manifold, but most
important is permanence of the new industry. Enough bauxite
is now known in Jamaica to duplicate the combined 1952 pro-

38

The Caribbean

duction of British Guiana and Surinam annually for the next
sixty years. Furthermore, it is axiomatic that extensions to
mineral reserves generally occur as a direct result of intelligent
exploration during development. Apart from initial capital ex-
penditures for acquisition of mineral concessions and the eco-
nomic stimulus resulting from payrolls for construction of roads,
plants, loading facilities, and housing, other lasting effects are
apparent. The Jamaica Government Railway has profited by
bauxite shipments; farming methods on bauxite lands owned by
the companies have been improved; many Jamaicans have re-
ceived technical training; villages have grown to towns; and the
Jamaica government is pleased with the prospect of a million-
dollar tax and royalty income each year. In addition, Jamaica
has recently organized a competent Geological Survey Depart-
ment, which is evaluating the mining potential of the island in
minerals other than bauxite.

III

Cuba is a rich mineral area. The more important products
are manganese, chromite, nickel, iron ore, and copper. The
lateritic nickeliferous iron ores of Cuba represent a Western
Hemisphere resource of tremendous importance. About 80 per
cent of the world's 1952 nickel production originated in Canada
and Cuba in the proportions of 17: 1. Two-thirds of the nickel
produced in the world is consumed in the United States as an
essential ingredient of stainless steels and armor-plate steel, to
which nickel imparts hardness, toughness, and strength. Hemi-
spheric self-sufficiency is a goal worthy of great effort in these
times of cold war and enforced preparedness of self-defense.
Possible eventual depletion of Canadian deposits through heavy
industrial demands points to the need for reliable new future
sources.
The Cuban laterites provide the Western world with guaran-
teed future nickel reserves. The Nicaro operations produced

RESOURCES AND PRODUCTION

CARIBBEAN MINERAL PRODUCTION-1952

PERCENT OF WORLD PRODUCTION
0 10 20 30 40 50 60 70 80 90 100

BAUXITE

SILVER

PETROLEUM

FLUORSPAR

LEAD

GRAPHITE

ANTIMONY

ZINC

MERCURY

MANGANESE

NICKEL

PLATINUM

GOLD

COPPER

CHROMITE

TUNGSTEN

IRON ORE

CARIBBEAN PRODUCTION

ALL OTHER WORLD PRODUCTION

Prepared by: Bureau of Mines, Department of the Interior-Nov. 1953

39

z 1 1 i I 1 1

t . i ./ .. ...... .... .. ... .. .. l .... ...... I . .

^.^k^^j- -.' ---- ----- -- -
b., .................................
^ l _......... .. .........

-, .,;.-#, ....._.:........................ ......
S l _.... .... I ...... ..... ..... ..... .... ...... .I. I ... .. ."

... ... i .

..............% ........................................... ......
........... ...
.. .... ..... ... ... ... ... ... .... .. .

,, ......~ ii.... .. ........ .. .. ....: ." "... ........... .. "
d y .j .x .. .... .. . .... .. .. .
.... ..... ii i..... *,,.................:.... :I i

",. .......... ............ ]............ I........... .. .

.. .. ....... .... ........ I..
................... ........ .. .. .. .. ... .. .. .. ..
........ ..... ... .. ...". ... ..... ........ ...... .....................................................iii~i i~i i~~i~ i~ ~i ii !i~ii~ii
. ... ....... ... ... .. ... .. .. ... ... .. ... ... .. .... .... ... .. .. .

. . ', . .. .
.i......... I. : ........ .. . .

................. % .............

I I I I I

I I I I

40

The Caribbean

8,000 metric tons of contained metal in nickel oxides during
1952. There is no immediate necessity for mushrooming the
output of Cuban nickel in peacetime. There is enough known
nickel in Cuba now to meet Western Hemisphere needs for fifty
or sixty years. Production is an established fact and has recently
doubled the 1952 output. New metallurgical processes are under
study, and research to improve recovery is well advanced. The
outstanding need for technologic improvement is the recovery
of the accessory minerals-cobalt, chrome, and iron.
Chromite was first imported into the United States from Cuba
in 1916, when a thirty-four-ton shipment arrived; since then the
business expanded to an average of 47,000 metric tons annually
between 1930 and 1940 and reached a peak figure of 286,000
metric tons in 1943 under the stimulus of wartime prices. Both
refractory-grade chromite, of suitable composition for manu-
facture of industrial brick, and metallurgical-grade, for produc-
tion of ferrochrome, have been mined in Cuba. Known deposits
are not very large, but production has been consistent for several
decades; and the record shows that, when price incentives have
existed, the chromite producers of Cuba responded. In 1952,
Cuba shipped 86,000 metric tons of chromite to the United
States, an amount larger by half than the average of the
1930 decade.
The chromite reserves of Cuba were reliably reported in 1918
to be between 93,000 and 170,000 metric tons; for the next
decade chromite demand was low and production waned, but
by 1933 the higher figure had been exceeded. Again, in 1943,
the reserves were conservatively set at 550,000 metric tons, with
a factor that could be used to estimate extensions in depth at
the rate of 1 million metric tons of shipping-grade refractory
chromite for each 100 feet of depth. As mining progresses new
ore is being discovered.
Another proved mineral occurrence in Cuba that has afforded
work to many and contributed taxes to government, profit to
owners, and wages to labor over a long period is manganese. In

RESOURCES AND PRODUCTION

41

the manufacture of steel, manganese is essential; wherever steel
is produced manganese will be in demand. During the fifty-five
years before 1943, Cuba exported 2 million metric tons of man-
ganese ore; the annual rate fluctuated greatly, but the incentive
of wartime prices resulted in a peak year of 300,000 metric tons
in 1943. During 1952, the output was almost as high, and Cuba
produced a quarter of a million metric tons during a year when
the United States consumed four times that amount.
The utilization of Cuban laterites as iron ores depends some-
what upon the more nearly complete removal of chrome, nickel,
and cobalt. The tailings rejected from the Nicaro operation
might well be considered as iron ore, except for the small
amount of these contained metals, which from an iron-ore
viewpoint comprise residual impurities. Metallurgical progress
eventually will provide a solution, and the tailings that are now
being impounded in the shallow portions of the bay may then
be recovered and smelted for the iron content. Over a period
of about three decades Cuba exported 4 million metric tons of
nodulized Mayari iron ore, which was advantageously utilized
by the steel industry for its nickel-chrome alloying properties, but
this ore failed to meet the more rigid grade tolerances that steel
manufacturers were forced to adopt to meet metallurgical speci-
fications developed during World War II, and demand has
declined accordingly.
Cobalt occurs in the Cuban laterites in approximately the
ratio of one pound for every fifteen pounds of nickel. A small
amount of cobalt is currently recovered mixed with nickel oxide
from the Nicaro operation, but no concerted effort is being made
to separate it by the present metallurgical process, which was
essentially developed to recover the nickel with no emphasis on
cobalt. Investigations are now in progress to yield cobalt as well
as nickel for the industry. If it can be recovered at a reasonable
price, it may add another economic asset to the Cuban list. Such
technologic advances would not apply exclusively to Cuban ores
and, of course, might well be equally, or even more, advanta-

42

The Caribbean

geous in other producing areas that could produce cheaper. The
proximity to North American markets and the desirability of
short sea lanes in time of emergency are factors favoring a Carib-
bean source. Iron ores that have successfully competed with
those from other sources derive from Cuban hematite and mag-
netite deposits, from which 22 million metric tons were mined
and exported over the sixty-year period preceding 1942. The
record shows that Cuban iron ore production in 1952 was 101,-
000 metric tons. Venezuelan competition within the Caribbean
area, and Canadian and Brazilian production elsewhere within
the Western Hemisphere, must be reckoned with in any future
effort aimed at stimulating exports of Cuban iron ore.
The Matahambre copper mine has been a consistent producer
for four decades. From 1914 until 1944, 6 million metric tons
of ore were mined, and the mine was considered depleted. How-
ever, in the latter year a new ore body was discovered by com-
bined deduction and diligence, and the mine took another lease
on life. In 1952, the monthly production averaged 1,500 metric
tons of contained copper in concentrate, which was shipped to
the United States. For many years Cuba has partly contributed
to its own petroleum needs from wells in two active fields.

IV
The twin Dominican and Haitian republics, on the island of
Hispaniola, are characterized by very minor known mineral
resources. The island lies within the belt of lateritic soils com-
posing the bauxite deposits of Jamaica; preliminary reconnais-
sance has disclosed the existence of this material. The grade of
the bauxite is satisfactory for metallurgical use, but the tonnage
observed so far has been infinitesimal, and its exploitation
would destroy agricultural land more valuable for its present use.
Haiti has some lignite that has not yet enjoyed active develop-
ment, although its possibilities as an industrial fuel should not
be overlooked. As an eastward extension of the Cuban geologic

RESOURCES AND PRODUCTION

43

environment, Hispaniola merits more detailed mineral explora-
tion than it has yet received.

V
Puerto Rico depends largely upon agriculture and small in-
dustries, with little emphasis upon mineral resources. Bauxite
may well show up in the list of future discoveries. There are
two cement plants which operate on local limestone and clay
and imported gypsum, producing for home consumption a com-
modity sorely needed in many parts of the Caribbean area.
There are some occurrences of clays worthy of mention, in-
cluding bentonitic types in demand for industrial purposes.
Geophysical prospecting has failed to locate geologic structures
favorable to the entrapment of petroleum.

VI
The volcanic chain of the Windward Islands can be omitted
from the present discussion as unimportant so far from a mining
standpoint. On reaching Trinidad, however, the scene again
changes. Here petroleum begins to enter the economic life of
the Caribbean on a substantial scale. The 1952 figures indicate
Trinidad crude production at 21 million barrels, with 37 million
barrels of refined products. To this must be added the natural
asphalt exports amounting to 173,000 metric tons from an
asphalt lake deposit.
Much of the Guiana bauxite passes through Trinidad, where
a marine transfer station at Port of Spain permits transshipment
from smaller river boats that ply between the mines and Trini-
dad to large seagoing vessels which load quickly without delays.
This is a transportation, not a mining problem.

VII

Venezuela's petroleum industry has thrived for over thirty
years. It is the world's largest petroleum exporter. Petroleum

44

The Caribbean

represents 97 per cent of the nation's exports in terms of value,
and 60 per cent of the government's revenue comes from this
source. Production is second only to that of the United States,
and the oil reserves of Venezuela rank sixth in the world. The
industry employs 44,000 people in Venezuela at wages higher
than anywhere else in the country, including fringe benefits such
as health insurance, paid vacations, and sick leave without loss
of income.
The petroleum industry is so specialized that it is almost a
field in itself, although definitely a phase of mineral-resource
development in the broad sense. Other mineral raw materials
have important impact on Venezuelan economy. Chief of these
is iron ore, developed in the very recent past largely by two
great steel producers of the United States. The iron-ore reserves
of Venezuela have been conservatively estimated at 2 billion
metric tons. The largest deposit is that known as Cerro Bolivar,
which is reported to represent 400 million metric tons of 63 per
cent iron ore as compared to the El Pao, containing 65 million
metric tons of ore varying from 55 to 69 per cent but averaging
1.5 per cent higher in iron than Cerro Bolivar. Other occur-
rences are controlled by several well-known steel companies,
largely United States controlled, or are held by the Venezuelan
government itself. Of the latter, the San Isidro is possibly as
extensive and high grade as Cerro Bolivar. Mining properties
in Venezuela are subject to two distinct sets of regulations,
depending upon date of acquisition. Before 1936 the usual
denouncement, a procedure similar to claim-staking in the
United States, was valid. New legislation dating from that year
reserved to the federal government the mineral lands in the
public domain within certain designated areas. Cerro Bolivar
and El Pao were secured under the earlier denuncios, but
many of the holdings are subject to the later law. The earlier
arrangement was somewhat more favorable to the development
organizations.
Under the new legislation, the government of Venezuela

RESOURCES AND PRODUCTION

45

permits the mining of a designated tonnage of iron ore by the
company, after which the ore is shared equally with the govern-
ment but is mined by the company. It is to be disposed of by
public sale, the company having the right to match the price
of the highest bidder, if it wishes to do so. If Venezuela should
decide to establish a smelting industry, at least a part of its share
of the ore would be reserved for that purpose.
The foreign companies have made tremendous initial invest-
ments in roads, living quarters-in fact, whole new communities
-port facilities, a railroad, telephone system, mine plant
and equipment, and loading installations. One company began
operations in 1950 after investment of 65 million dollars; it is
exempted from royalties on the first 50 million metric tons
mined. The annual production rate in 1952 was 2 million metric
tons, which can easily be boosted 50 per cent, although in case of
urgent need the top estimated annual output possible would be
5 million metric tons. The second large venture will not be in
production for another two years.
The mineral industries of Venezuela provide almost the com-
plete support of the government and the people. Industrial
development, highway facilities, and port improvements have all
been paid for with revenue from minerals. Venezuela imports
foodstuffs, machinery, textiles, and many other manufactured
and semimanufactured articles. The high-cost, high-wage econo-
my is a factor to be faced in mining operations, and both
foreign and domestic investors have seemingly lost interest
in some phases of the minerals industry, particularly in gold.
Venezuela has coal resources as well as iron-ore deposits. This
fortunate combination of mineral wealth may sometime be the
basis of a Venezuelan steel industry.
Venezuela's mineral riches are not confined to petroleum,
coal, and iron ore. Diamonds are produced in minor quantities
(1) by individuals who work by hand-methods in areas where
machinery is prohibited by decree, and (2) by a newly formed
Compafiia Anonima, largely owned by the Venezuelan Develop-

46

The Caribbean

ment Corporation, a government entity. Recorded production
has risen in the past few years but is still low, amounting to
only 0.5 per cent of the world output; about half of the Vene-
zuelan diamond output is industrial stones. There is reason to
believe that this mining activity could be expanded manifold
in time of need by systematic application of the latest technology.
Modern industry requires diamonds for many uses to maintain
high-speed and precision processes at maximum efficiency.
North America depends completely upon foreign sources for
industrial diamonds. Substitution of boron carbide and other
synthetic hard alloys for tool steels has multiplied the effective-
ness of high-speed machining. None of these, however, can
replace the diamond in its special fields of application without
serious loss in efficiency. The diamond has acquired the status
of the indispensable abrasive for shaping the carbide alloys
which are the key to modern machine and munition manu-
facture. In the interest of Western-world defense solidarity,
emphasis should be placed upon thorough investigation of the
production potential of all diamond fields, large and small,
within the hemisphere. The cataloguing of these reserves
through careful study is important.
The future of gold mining is dubious in many parts of the
world; most producers are discouraged by a general feeling that
the pegged price of gold and greatly increased mining costs
are incompatible. In Venezuela a once-flourishing gold-mining
industry has largely died out.
Bauxite occurs in the country, but further study is required
to indicate whether the deposits are large enough to form the
basis of an important addition to the minerals industry. Asbes-
tos is being mined in a small way, and there is a determined
effort by the owners of the principal properties to re-establish the
industry on a firm basis that would not be dependent upon the
sporadic stimulus of wartime emergencies. Manganese deposits
are currently being studied with a view toward possible
mining.

RESOURCES AND PRODUCTION

47

VIII

Colombia is a country with mineral resources that play an all-
important part in its over-all economy. Its status as a petroleum
producer is well below that of Venezuela; but this commodity
is steadily being exported, contributing materially to government
revenues and the earning power of the country. For almost three
decades after initial petroleum production in 1921, the output
averaged 20 million barrels annually. Within the very recent
past, this figure has approximately doubled.
The solid fuels resources of Colombia are large and varied.
Bituminous coal abounds in many areas, and some of it has
satisfactory coking characteristics. The coal measures are dis-
tributed throughout the country, and some locations are now far
removed from present industrial consumers. Total Colombian
coal reserves may be tentatively regarded as 10 billion metric
tons, the largest in South America. The Industrial Development
Institute gave serious thought to establishing an export-coal
industry and is currently arranging for constructing a coal wash-
ery at Cali to maintain quality within salable specifications.
Buenaventura has been designated as the Pacific Ocean export
port where loading facilities will have to be installed to imple-
ment the plan. In the northeast part of Colombia, the govern-
ment has considered development of coal which could be
exported from the north coast to Caribbean markets. The
principal cost items involved in this scheme are the lack of a
deep-water terminal, necessitating a dredging program plus the
need for construction of 62 miles of railroad, aside from the cost
of the mine plant. Until the demand of the Caribbean or the east
coast of South America becomes specific, there is little incentive
for private or government capital investment in the development
of the coal of that section.
A national steel industry has been undertaken at Paz de Rio,
including a coal mine, coke plant, blast furnace, open hearth,
and rolling mill. The investment is large, and financing is based

48

The Caribbean

upon foreign loans to the Colombian government. The produc-
tion of steel within the boundaries of a country provides a feeling
of partial or complete independence from foreign sources in time
of emergency. It represents a measure of industrial progress and
is an object of national pride of accomplishment. Economic
factors, of course, dictate its over-all effect on the basic economy
of the nation; for survival in the face of competition from other
sources, it must produce specification steel at a price the con-
sumer can afford. Artificial protective legislation may, in some
instances, result in hardship to the consumer and a decrease in
dependent industry. The best guarantee of success is strict ad-
herence to quality and uniformity of product through competent
supervision, widespread industrial training of unskilled labor,
and recognition by labor and capital alike that an inferior prod-
uct can only hinder their own cause. The fact that Colombia
is embarked upon the first unit of a steel industry, using its
own mineral wealth for the national benefit, is proof of the
advance of industrial development in that area.
Although large reserves of high-grade iron ore have never
been discovered in Colombia, there are moderate tonnages of
medium- and low-grade material that may eventually increase
relatively in value with depletion of top-quality material. At Paz
de Rio, the basic estimate showed 20 million metric tons of 46
per cent iron; this is the deposit upon which the new steel plant
will depend. There is ample evidence that reserves may be
greatly increased by further exploration. Lateritic iron ore of
medium and low grade is known to exist in Antioquia, and has
been exploited only in sporadic and desultory fashion.
Gold and platinum production in Colombia is very important.
In 1952 the gold output was 422,000 troy ounces, while the
estimated platinum recovery was 34,000 troy ounces. The latter
is valued at almost three times the price of gold, bringing the
total to 18 million dollars. The industry involves two types of
operation. Modern dredges handle tremendous yardages by
mechanical means and recover gold and platinum therefrom

RESOURCES AND PRODUCTION

49

with relatively small labor cost per yard dug. The other ex-
treme is represented by thousands of individuals who are per-
mitted, under Colombian law, to work placer ground along
navigable rivers, regardless of ownership. The methods used by
those working on their own behalf are primitive and crude, but
the numbers engaged in it provide ample proof of the lure of
exploitation of precious-metal deposits.
Other mineral resources of Colombia worked regularly are the
government emerald and rock-salt monopolies. Both date well
into the past, the emeralds being known to the indigenous people
conquered by the Spaniards. The government mines rock salt,
which occurs in tremendous masses, by underground methods;
it is dissolved to brine, which is then sold to private individuals
who evaporate it to produce a marketable grade of salt; at some
deposits the government refines salt from brine. Obviously, a
low-value product such as salt does not bring in the revenue of
higher priced commodities. Salt contributes 1 per cent of the
government's revenue and constitutes a 5-million-dollar business
with an annual production rate of 138,000 metric tons from all
sources in 1951. A new plant near the capital, built by the
government, utilizes salt as the raw material for production of
chlorine and caustic soda.
Colombian emeralds, like Venezuelan gem diamonds, contrib-
ute to the mineral production but add nothing of interest to
the industrial minerals picture. In fact, while Venezuelan indus-
trial and gem diamonds are recovered together and the gem
quality is later separated from industrial stones, there is no ac-
cessory product from emerald mining to stimulate production,
other than popular demand for the beautiful stones. Emerald
is beryl, which has important industrial uses when found in
sufficient amount; the Colombian gem emeralds occur with such
minor amounts of common beryl that the latter is uneconomic
to produce at this time.
Sulfur in somewhat low-grade deposits in Colombia neces-
sitates expensive processing, which may be justified in times of

50

The Caribbean

great emergency but is normally marginal. Minor metallic
mineral occurrences are lead, zinc, and copper, as well as
asbestos and some other nonmetallics.

IX
Leaving Colombia, we next reach Panama, with its known
gold players and elusive manganese deposits. Manganese of
excellent quality has been produced sporadically in very small
amounts since 1895. There is no published report of the true
extent of the deposits. They lie on the Caribbean side, adjacent
to the shore where rainfall is very high and jungle conditions
prevail; San Blas Indians inhabit the region. Nevertheless, it
is a resource which Panama may wish to stimulate into pro-
duction in the future and is worthy of this brief mention.
Gold production in Panama used to be important to the
country, although it was only a drop in the bucket as far as
world production was concerned. However, the output declined
from 10,000 troy ounces in 1949 to 1,000 in the following year
and to two-thirds of that in 1952. The unfavorable cost-price
relationship prevailing generally in the gold mining industry of
the world has affected Panamanian production in the same way
that it has production elsewhere.

X
The Central American countries are not mineral producers
of marked importance. Honduras has mines that produce con-
siderable gold and silver. The 1952 production statistics indicate
an output of 32,000 troy ounces of gold and 3.7 million troy
ounces of silver. Guatemala has what may be the richest lead-
zinc deposit of recent times, and in 1952 produced 4,000 metric
tons of lead and twice that amount of zinc. Silver output was
372,000 troy ounces in the same year. Foreign investment in
mining in Guatemala is at present at a low ebb, owing to the

RESOURCES AND PRODUCTION

51

intransigent attitude of the present Communist government
toward outsiders. Chromite in almost infinitesimal quantity has
been exported by Guatemala, and hydraulic cement was also
an export commodity. Nicaragua has large gold and silver
production to its credit; the 1952 figures are 250,000 ounces of
gold and 137,000 ounces of silver. No other minerals of im-
portance show up in the Central American record, though small
quantities of manganese ore have been produced sporadically.

XI

Mexico, the last on the list and Caribbean mineral producer
par excellence for more than four centuries, deserves more de-
tailed treatment. The conquest of Mexico was predicated upon
gold and silver to be mined or extorted by the victors. They
were not disappointed, as we are all well aware. From that
time in the early sixteenth century until the Mayflower landed
at Plymouth Rock, Mexican silver production had totaled 200
million dollars. The economy of the country has rested upon
minerals ever since, and although a quarter of the world's silver
still comes from Mexico, base metals of industrial importance
have become the basis of the mineral industry. Recently re-
leased figures indicate that 95,000 persons were in 1950 direct-
ly employed in Mexico's mineral industry-including mining,
smelting, petroleum, and natural gas.
Antimony produced by Mexico in 1952 totaled 5,500 metric
tons; the entire United States imports for that year were only
7,000 metric tons. Antimony is sensitive to price, which fluctu-
ates with demand, greatly stimulated by wartime needs. Like
other Mexican mineral raw materials, antimony can be supplied
in times of national emergency because there are no sea lanes
to cross in the all-land route to the United States. Some ores and
concentrates are shipped abroad for smelting, and other antimony
is obtained indirectly from lead smelters, the by-products being

52

The Caribbean

smelted together with Mexican antimony ores to produce speci-
fication metal within the country.
Many Caribbean countries are blessed with such a variety of
minerals that it would be impractical even to list them here;
one such country is Mexico, and it will be necessary to mention
only the most outstanding mining operations and mineral-
industry installations. Copper is mined and smelted in Mexico,
and a small part of the output is electrolytically refined there.
During the year 1952, Mexico's copper production was over
58,000 metric tons in ores and concentrates, plus 51,000 metric
tons of metal, mostly anodes for export, destined for refining
abroad. The corresponding importations by the United States
were 92,000 metric tons in ores and concentrates and 465,000
metric tons of copper metal. Mexico could have supplied two-
thirds of the United States needs in ores and concentrates and
11 per cent of the cast copper imported in 1952. Copper
smelters in Mexico are largely owned by companies that mine
their own ores and smelt them as part of an integrated opera-
tion. The exception is a large lead smelter having copper blast
furnaces for reducing lump custom ores available in the vicinity.
The United States steel industry depends upon domestic mines
for part of the fluorspar needed in its operations, the remainder
being obtained abroad. Mexico produced 180,000 metric tons
in 1952, the total of our imports that year reaching 326,000
metric tons. Most of the fluorspar not imported from Mexico
comes from Europe. Mexico's fluorspar reserves are important
and considerable. An effort should be made, before it is too late,
to conserve the low-grade fluorspar that is not now salable by
concentrating methods. Mexico is the only Caribbean country
that produces graphite. In 1952 the metric tonnage mined and
shipped was 24,000, and in the same year the whole amount
imported into the United States was only 39,000 metric tons
from all world sources.
Mexico is also a great gold-producing country, with 459,000
troy ounces to its credit during 1952. This exceeds the output

RESOURCES AND PRODUCTION

53

of any other Caribbean country, and is largely the result of
great and efficient lead- and copper-smelting industries which
recover gold from ores and concentrates mined principally for
their base-metal content. This is a healthy condition, from an
industrial viewpoint. When other countries of the Caribbean
area reach the economic stage where their concentrating and
smelting operations are more generally carried on at home, in-
dustrial employment will rise, national incomes increase, and
government revenues become greater. Mexico has several effi-
cient, well-run smelters, which produce copper, lead, zinc, anti-
mony, and steel, apart from numerous by-products, including
gold and silver.
Two large steel works in Mexico smelt iron ores locally pro-
duced, using coke from Mexican coal. Iron-ore production is
relatively small, although the reserves of the nation are moderate
in size and relatively high grade. Most of the Mexican iron-ore
deposits are completely undeveloped and only partly explored.
The most important question to be solved in the rational ex-
ploitation of iron ores is whether there are coking-coal reserves
large enough to match available iron. This subject is under
investigation. In the year 1952 the total output was only 500,000
metric tons of iron ore. Venezuela, just going into produc-
tion, mined and shipped four times as much, but smelted
none. Mexico utilized 75 per cent of the 1952 production at
home. In the same year the United States imported 10 million
metric tons of iron ore, of which 114,000 metric tons were from
Mexico, in addition to its own huge production. Iron ore with
coal near by eventually develops industrial strength. Mexico is
supplying much of the steel required for its railroads, construc-
tion, and other industries because of the fortunate juxtaposition
of iron and coal. If it is determined that there is insufficient coal
for making coke to smelt Mexico's iron, the alternatives are to
seek other metallurgical processes, export the surplus iron ore,
or import coke if available. The determination will require
careful and exhaustive study.

54

The Caribbean

The mineral resources of Mexico include coal in several areas;
one of these coals is of coking quality. Coke produced locally
is used for iron-ore smelting, lead and copper smelting, zinc
reduction, and foundry operations throughout the republic. The
constant drain on the coal reserves argues depletion within the
foreseeable future, though several fields have not yet been de-
veloped. Some coal and coke are imported by Mexico; in 1952,
the coal output was 1.3 million metric tons, most of which
was coked.
Lead and zinc in Mexico are intimately associated in most
ores, and what controls the production of one in general affects
the other. There are some few exceptions to this statement. A
few decades ago numerous small smelters were scattered over
the whole Mexican republic. Now, most of these have given
way to a few large, efficient smelters, well situated relative to
railroads, able to make recoveries that the small smelters could
not match, and equipped with the latest machinery and control
devices necessary to produce lead, antimony, white arsenic, silver,
gold, and a host of by-products in which bismuth, cadmium, tin,
and other metals are concentrated. More recently, steps have
been taken to build or consider the construction of large, expen-
sive fuming plants to save zinc formerly discarded in the lead
slags. These smelters contribute enormous sums to the Mexican
economy through wages and fringe benefits to labor, freight for
the nationalized railroad system, and taxes to the government;
and they support whole communities of miners, smeltermen, and
their families. In 1952 production of lead in Mexico was 237,-
000 metric tons of metal pigs and 9,000 metric tons more in
ores and concentrates. Only 2,000 metric tons in ores and con-
centrates reached the United States, although 180,000 metric
tons of metal were imported from Mexico.
Zinc-treatment plants in Mexico have increased recently. The
one zinc smelter that has operated for many years, producing
53,000 metric tons of smelter annually, is being augmented by a
slag-fuming plant at another smelter for recovery of some 20,000

RESOURCES AND PRODUCTION

55

metric tons of zinc in high-grade oxide fume from lead-plant
slags formerly discarded. Elsewhere, the calamine ores of Mex-
ico have begun to yield their zinc content in the first unit of a
Waelz kiln operation which was planned for future expansion
by the addition of other similar units. A second slag-fuming
plant is currently under consideration for future construction.
None of these recently conceived or constructed treatment plants
provides the capacity needed for reduction of zinc concentrates,
which were produced at the rate of 227,000 metric tons of con-
tained zinc during 1952. Much of this material was exported
to the United States, but one-third of it was shipped elsewhere.
Manganese is an important ore mined in Mexico for use in the
local steel industry, with a surplus for export. During 1952 the
total mined from numerous relatively small deposits was 102,000
metric tons, of which 52,000 metric tons were exported to the
United States. In the same period the total United States im-
ports were three times as much from the Caribbean alone, and
five times as much from all Western Hemisphere sources. In all,
over 1 million metric tons of manganese ore entered the United
States from abroad in 1952. The market for manganese is large
now, and will increase in time of emergency. Cuba and Mexico
can supply larger tonnages under the stimulus of price incen-
tives; and Brazil, with its tremendous reserves, perhaps second
largest in the entire world, stands ready to meet any reasonable
demand. Global warfare, particularly if submarines were con-
centrated on the sea lanes, would rule out most areas other than
the Western world. In the Second World War, 85 per cent of
the bauxite fleet was torpedoed before the submarine menace
was brought under control. Mexico can ship by land and Cuba
by the shortest sea route, perhaps more easily patrolled than any
other. These two countries produced one-third of our manganese
needs in 1952, although only part of it found its way into the
United States. Manganese is like fluorspar in that the mine-run
material is frequently shipped without concentration. Again the
admonishment is valid that lower grade materials could and

56

The Caribbean

should be upgraded by mechanical means as a conservation
measure. The result would be tremendously increased ore re-
serves, because the material that cannot be mined at a profit is,
by definition, waste and not ore. This point is worth expanding.
Fluorspar is generally a mine product that has to meet speci-
fications of high purity. Concentration is common in the United
States, but practiced less abroad. Conservation of the reserves of
fluorspar in Mexico could be improved by wider application of
milling operations to permit mining lower grade material, thus
increasing the size of minable reserves for the future. To meet
high-purity specification, the same practice could be adopted for
manganese and other ores that are shipped crude. However, the
imposition of government controls on private industry to enforce
conservation involves the expenditure of large sums for metal-
lurgical installations and may stifle business. The best remedy
for this is stable government and a reasonable taxation schedule.
Silver has many industrial uses, but it is largely a luxury and
coinage metal. The Mexican position is pre-eminent. In 1952,
with 50 million troy ounces, Mexican output was one-fourth of
the entire world production, a loss from previous years but not a
threat to its position of world leadership in this metal. The only
near rival of Mexico is the United States, which produces about
three-fourths as much. The Mexican output is over 90 per cent
of that of the entire Caribbean area, and the recent decrease is
due to depletion of the ore reserves of the greatest silver-mining
district in Mexico and, for that matter, in the world.
A phase of Mexico's mineral economy that has seen great
tonnage increase is the sulfur industry, with the exploration and
development of deposits in the south. The year 1952 showed
12,000 metric tons output. United States self-sufficiency in sul-
fur is already a fact, but many other Western Hemisphere coun-
tries are not so well off in regard to it. In the very recent past
the demand for sulfur far exceeded production capacity. The
Mexican industry derives sulfur from deposits of elemental sulfur
and from natural gas, and sulfuric acid from smelter gases.

RESOURCES AND PRODUCTION

57

With heavy-chemical industry on the increase in Mexico, the
sulfur produced will be largely used in that country.
No mention of Mexico's mineral wealth would be complete if
petroleum were ignored. For half a century, Mexico has pro-
duced petroleum, the last third of this period under nationalized
operation following much-publicized expropriation. The pe-
troleum production of Mexico is nearly three times that of
Colombia but only one-sixth of that of Venezuela. Mexico now
consumes its own production and imports petroleum to the
northern areas to supplement its needs.

XII
Having talked to you about the mineral industry of the Carib-
bean, I would be leaving you with an incomplete picture if I did
not suggest what is needed to promote future prosperity in min-
ing and allied operations in this area. Several points come to
mind which should be discussed briefly in closing.
(1) There is a notable lack of adequate information on min-
eral resources for the area as a whole. Many careful studies
have been made, some by local governments, some by organi-
zations interested in investing or actually operating in these
countries, and some as a result of intergovernmental technical
cooperation. In the United States the Bureau of Mines and the
Geological Survey have collectively spent about a hundred years
studying our mineral resources. Our great industrial organiza-
tions constantly re-examine and revaluate earlier proposals to
operate this or that mine, redefine reserves, consolidate various
holdings, and investigate specific deposits. Area studies are made
by government, both state and federal. Still, the cataloguing of
our resources is incomplete because it is a continuing job, and
new discoveries are frequently made to this day. This may give
an idea why every country in the Caribbean area should devote
much more study than it actually does to its mineral resources if
the governments hope to develop them intelligently.

58

The Caribbean

(2) Mining legislation is either lacking or unrealistic in many
Caribbean areas. Government integrity is indispensable. One
expropriation destroys the confidence it has taken years to build
up. Politicians must learn that the short period of their incum-
bency is unimportant as compared with the life of the nation,
and they must be taught to respect and uphold the statutes that
pertain to the mineral industry. Any Caribbean country desirous
of reforming and modernizing its mining code might well look
at the excellent examples of Canadian and Peruvian mining
laws.
(3) Three principles should be observed for sustained pros-
perity of the mining industry:
(a) The common man, who is invariably the discoverer, is
the one who knows the country and prospects it, be he farmer
or miner. He should receive fair, not excessive, reward for his
discovery. This stimulates further search by other potential dis-
coverers.
(b) The capitalist invests venture capital for exploration
that is followed by heavy capital outlay for equipment and de-
velopment. Unless he receives guarantees of financial safety,
with enough return on the investment to warrant the risk factor
related to mining, he will shun the project and invest his funds
in other countries or other industries. He feels justly entitled to
profit commensurate with his financial risk.
(c) The government is entitled to reasonable revenue
through taxation, in return for which absolute honesty in ad-
ministering the law and eliminating all discrimination should be
forthcoming. Stability of government is essential; adherence to
established mining law by any newly set up government would
prove its integrity.

XIII

Ours is a country based upon the free enterprise system; our
advice and counsel to our neighbors must be that if they would

RESOURCES AND PRODUCTION

59

improve their own conditions of life and improve their standards,
they should create conditions conducive to this system in their
countries. Mining is big business, but it is a basic one in every
sense of the word. At home our domestic producers clamor for
protective measures against the production of what they term
low-cost foreign labor. Our importers are equally vociferous in
demanding that foreign mineral raw materials be admitted with-
out restraint. We currently face the necessity of sustaining the
domestic mining industry in times of high cost and low prices
without shutting the door to foreign sources that have heretofore
proved valuable in war and peace. We must not let wishful
thinking influence hard-headed analysis of our own mineral
supply problems. Meanwhile, although no firm mineral policy
exists in our own government to meet all conditions and con-
tingencies, we should carefully consider all aspects of foreign
mineral development. If the Caribbean countries will recognize
the basic business principles of supply and demand and legislate
toward sound guarantees by responsible governments, with mini-
mum government control of private industry, foreign and do-
mestic capital can be counted upon to respond to incentives for
establishing and maintaining a prosperous mineral industry.

5

Felisa Rinc6n de Gautier: PUERTO RICO -
ITS RESOURCES AND GOVERNMENT

IN HIS BIOGRAPHY of the Caribbean, Professor German
Arciniegas said: "To know the world, one island is more than
enough." Limiting my world to the Caribbean, I bring you this
progress report from my island. The knowledge I have of the
world, she has given me. In her I love the world, and by loving
her people I love the people of the whole world.

I

When Ponce de Le6n came and discovered Florida, he was
old and tired and still searching for the Fountain of Youth. He
had already spent most of his twenty-five years in America lay-
ing the foundation for the Puerto Rico that we have today.
The first governor of Puerto Rico appointed after the discov-
ery of the island and the founding of the city of San Juan
Bautista was Ponce de Le6n, in the year 1508. The first gov-
ernor of Puerto Rico elected by the people, in the year 1948,
was Luis Mufioz Marin, who was also the first governor elected
under the constitution drafted by the people of Puerto Rico and
adopted by them in 1952. Between these dates-1508 and 1952
-a whole drama has taken place, sometimes quietly, violently at
times, but bringing about the growth of Puerto Rico and of my

60

RESOURCES AND PRODUCTION

61

people and your people, in the sense that the Caribbean belongs
to all of us.
Let us take a bird's-eye view of the historical events that took
place in this island of the Caribbean under the Spanish regime,
when gold was the main attraction (and there was not much in
my island). Then came the extermination of the Indians and
the beginning of the African traffic. Soon our aromatic coffee
won for itself a name in the European markets, which name
became synonymous with Puerto Rico. Today, we keep in those
markets only the memory of that reputation.
After the first half of the nineteenth century, civic organiza-
tion began. The idea of political parties sprouted and grew.
The wars for independence in North and South America had
been fought. Puerto Rico's main concern was to have political
rights for her people recognized by Spain.
Struggling and striving, we won and lost. In the end we won.
We made tremendous progress immediately prior to the Spanish-
American War. In 1898, Puerto Rico enjoyed almost full au-
tonomy-autonomy that we lost soon after by the Treaty of
Paris. Cuba secured her independence. Puerto Rico came under
the sovereignty of the United States.

II

The ending of one century and the beginning of another,
1898-1900, marked the termination of our relationships with
Spain and the initiation of our association with the United
States.
There was already a great leader in Puerto Rico; his name,
Luis Mufioz Rivera. He has been identified as the George
Washington of Puerto Rico. A great writer, fighting with his
pen in Spanish, he won autonomy for Puerto Rico from Spain.
A great statesman and diplomat, he went to Washington as the
first Resident Commissioner of Puerto Rico. He learned English,
and in a very short while he was addressing the congressmen in

62

The Caribbean

their own language. He succeeded in liberalizing the political
system in 1917. (Incidentally, Luis Mufioz Rivera was the father
of our present governor, Luis Mufioz Marin.)
As I said, he gained for Puerto Rico the liberalization of a
political system which had been in effect since the early years
of the nineteen hundreds, when Puerto Rico came under the
American flag. With the liberalization of the regime, the basis
of equality, which should be a determining factor in our future
association with the American people, was set forth. United
States citizenship was granted to all Puerto Ricans at this time.
Besides, the island enjoyed free commerce with continental
United States.
The hurricanes and the changes in the market had reduced
our one cash crop, coffee. The lowlands around our coasts began
to be planted with sugar cane. Sugar was rapidly accepted in
the United States market and was protected by the tariff. The
island ran the risk of being converted into a big cane field and
sugar factory. The birth rate increased and the death rate de-
creased. Suddenly there was not enough space for all of us. The
agrarian economy was insufficient for the support of the whole
population. Poverty makes people hungry.

III

The political leaders were still deeply concerned with political
affairs, and economic realities were the ideas of the socially
minded few. For the solution of the problem of political status,
people advocated either classical federal statehood or complete
separation from the United States.
All during the past generations, the Puerto Ricans have been
in a constant struggle for the betterment of their country. Each
generation produced its own leaders, who faced all adversities
with a high degree of civic spirit; but the classical political
formulae, which in the case of other countries were the solution
to their problems, in the case of Puerto Rico led to economic

RESOURCES AND PRODUCTION

63

chaos. Complete separation from the United States would have
meant economic disintegration. Classical federal statehood also
would have meant economic ruin. The traditional political posi-
tion was reviewed at the end of 1930-1940 decade, and it was
determined that the political status of Puerto Rico was not the
main issue. We faced with a deep sense of reality the problems
which were pressing upon all of us, and we decided to stick to-
gether and work toward the solution of our economic problems
for the betterment of all our people.
Luis Mufioz Marin is the leader in all this new approach to
the fundamental problems. He worked the miracle. And in spite
of the fact that I am one of his fellow workers, please allow me
the privilege of saying that he is one of the most outstanding
leaders of democracy that the Americas have today. He has
achieved wonders by uniting the people in a common objective
and guiding them along the routes that help us to solve our very
complicated social and economic problems.
With the slogan "The political status of Puerto Rico is not
the issue," Mufioz Marin founded in 1938 the Partido Popular
Democrdtico (Popular Democratic Party). He presented to the
people a very dynamic program which aimed at the solution of
our social and economic problems. He had the backing of the
people in the elections. The program of the party had been
submitted to the people and explained to them in the form of
drafts of bills to be introduced in the Legislature soon after the
elections. Voting for the party was voting for the program.
The Popular Democratic Party program won. The men and
women from our mountains, the workers, the small industrialists
and small merchants, everybody linked together for the common
effort to fight against poverty and misery. Legislation establish-
ing minimum wages, redistribution of the land, and tax exemp-
tion for homesteads was enacted and enforced. Assistance was
provided for small farmers and small industrialists. All the serv-
ices essential to the health, education, and welfare of the people
were increased, expanded, and intensified. Our rural areas were

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provided with electricity and a modem system of water supply.
The decade 1940-1950 was one of constant struggle and fight
against hunger and extreme poverty. In this great battle for
production, which was initiated and developed by all the people
and in all the different lines of our activities, we are now suc-
ceeding.
"Operation Bootstrap"-as Luis Mufioz Marin, with all sense
of propriety, has called the program for the industrial develop-
ment of the island-has already in operation over two hundred
and fifty new industries in Puerto Rico, employing thousands of
workers who were formerly unemployed.
We have made tremendous progress in these ten years, during
which our total production has been more than doubled. The
income of the wage-earner group has increased from $360 in
1941 to $1,058 in 1952. The increase in the gross income for
this same period was 194 per cent, and the real income-that is,
comparing the purchasing power of the dollar in 1941 with the
purchasing power of the dollar in 1952-has increased 68 per
cent.
Although our progress has been substantial, there is still a long
way to go. Governor Mufioz Marin has set as a goal of our
government for 1960 the increase of the annual average income
of Puerto Rican families to $2,000. That is our immediate ob-
jective. We will attain it; we will work hard, we will reach the
goal, but we will do so in a dynamic, democratic way.

IV

After defining our economic problems, and while working hard
at their solution, we shall be able to work on the political issue
too, enlightening our people to the fact that our destiny is linked
to the destiny of the United States. We have been enjoying the
right to elect our own governor since 1948, and, as I said before,
the first governor elected by the Puerto Rican people was Luis
Mufioz Marin. We enjoy the right to elect our own governor

RESOURCES AND PRODUCTION

65

because of an act of the United States Congress. This to us was
a real political achievement. But we still were at the crossroads
in the solution of our political status. We had to find the right
road, and we did by developing the idea out of our economic
realities, which were impossible to reconcile with the old political
formulas of complete separation (as a republic) or complete an-
nexation (as a classical federal state).
By virtue of a compact, agreed upon and approved by the
Congress of the United States and by the people of Puerto Rico
through their votes at the polls, we created the Commonwealth
of Puerto Rico, in free and voluntary association with the United
States of America. We did it through the enactment of our own
constitution, drafted by ourselves and, as in the case of the other
states of the Union, approved by Congress and the President of
the United States.
Our constitution gives Puerto Rico full home-rule government.
We enjoy a common citizenship. The political power emanates
from the people. We elect our legislative assembly and our gov-
ernor. We enact and enforce our own laws. The fact that we do
not have representation with vote in Congress differentiates us
from the states, but Congress does not levy federal taxes upon
the Commonwealth of Puerto Rico, being faithful to the prin-
ciple that gave birth to the United States of America: No taxa-
tion without representation.
If we were a state, we should be paying over 100 million dol-
lars annually to the federal treasury in taxes. At present, Puerto
Rico needs all her resources to increase production, to raise the
standard of living of her people, and to provide them with the
means of attaining health, education, and the cultural standards
of modern civilization. But on the day when our economy makes
it possible for us to participate in the expenses of the federal
government, Puerto Rico will gladly do so and will request from
Congress the pleasure of sharing with the other states in this
responsibility.
Puerto Rico is a Latin American community of American

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citizens, linked by race and traditions to Latin American coun-
tries on the south and to the United States by the free and
voluntary association of the commonwealth. Women have had
active participation in this program of the Commonwealth of
Puerto Rico, and our men have been very generous in welcoming
us to participate. Because of our desire to share in the great
battle for the improvement of the social and economic welfare
of our people, the men made a place for us in the front line,
directing and working with us at various levels. But I want to
make it clear that we women are not feminists in the meaning
of that word at the beginning of this century. We do not "wear
the pants." Our civic participation, our contact with the people
who need our services, the execution of our functions at the state
level do not affect our femininity. We are women and we want
to be women all the time. The Puerto Rican women are working
with the men, side by side, in the legislature, as well as in execu-
tive and administrative positions in the government, both state
and municipal.
The women of today in the Caribbean, sharing with the men
these responsibilities, are following their ancestors, the women
of other times. Our history is rich in examples of the participa-
tion of our women in the conquest and colonization of the
various countries.
With clear outlines and appropriate words, Germain Arciniegas
describes one of them when he says:
The unfortunate Beatriz de la Cuenca, mourning over the
death of her conqueror, Don Pedro de Alvarado, acted as Dofia
Juana la Loca, but when she wanted to be recognized as gover-
nor of Guatemala, exercised such audacity and strength that she
was restrained and overwhelmed only by the cataclysm which
reduced to ruins the old city of Guatemala; she was defeated by
the earthquake, the flood, and death.

6

Jose Rolz Bennett: GUATEMALA ITS
RESOURCES AND RECENT EVOLUTION

0 UR TIMES are witness to the numerous changes-some
evolutionary, others of a revolutionary character-that have tak-
en place in all nations of the world. It is the purpose of this
brief paper to present, although in a very general manner, the
fundamental modifications that have occurred in Guatemala in
recent years, because I believe it constitutes a good example for
a better tmnderstanding of the economic, social, cultural, and
political conditions of the Latin American countries. I must
warn, of course, that there are great differences between one re-
public and another in the Latin world of the Americas, but in
general it is my belief that the experiences of my country set
forth some of the fundamental problems that affect them all, in
different grades or shades.

I
The case of Guatemala is very enlightening because, in its
small territory and population, it offers the most varied aspects
in regard not only to geography, ethnical composition, and lan-
guages, but to socio-economic, political, and religious conditions
as well. Some facts will undoubtedly help us to understand the
quantity and complexity of its problems.
Territory and Geography.-The total extension of Guate-

67

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mala's territory is 108,889 square kilometers, equivalent to 42,-
042 square miles-without taking into consideration the territory
of Belize, known also as British Honduras, which belongs to
Guatemala but which is presently occupied by Great Britain.
Bounded by Mexico, British Honduras, Honduras, and El Salva-
dor, Guatemala has coasts on both the Atlantic and Pacific, but
the Pacific coast is considerably longer than the Atlantic.
Located in the tropical zone, Guatemala is endowed with a
variety of climates, ranging from the very warm in the coastal
plains to the temperate of the highlands. One changes climate
merely by varying one's altitude. Guatemala's only seasons are
the rainy season, from May to October, and the dry season, from
November to April.
The territory is very mountainous and volcanic in more than
two-thirds of the republic. The other third, located in the north-
ern part, comprises the Department of Petin, with an area of
35,854 square kilometers (13,843 square miles) of thick forest
plains, rich in hardwoods and, probably, in mineral deposits, but
practically uninhabited and with very limited land communica-
tion facilities. As long as Great Britain holds Belize, it blocks the
outlet of the Pet&n to the Atlantic. This vast region, therefore,
will integrate only slowly into the development of the rest of the
country.
The mountains that cross Guatemala, with several peaks and
volcanoes higher than 12,000 feet, help to shape the zones and
regions as follows: (1) the coastal plains, very warm and with
a rich soil; (2) the mountain slopes and foothills, from 300 to
4,500 feet, producing coffee, sugar cane, and other tropical
crops; and (3) the highlands above 4,500 feet, surrounded by
mountain peaks and volcanoes. Because of the excellent climate
and reasonably good soils in the highland valleys, the greater part
of the population is concentrated there.
Population.-According to the census of 1950, Guatemala had
2,788,122 inhabitants. Today this number is estimated at a little
more than 3,000,000, of which 1,350,000 are white or mestizos,

RESOURCES AND PRODUCTION

69

and 1,650,000 are descendants of the indigenous groups that in-
habited the country before its discovery and conquest by the
Spaniards.
From the ethnological point of view, it is impossible, if not
absurd, to establish a difference between the various groups, and
even the term indigena, which denotes the aboriginal inhabitant
of the country, is questionable if it is to be based on one trait
alone, be it racial, cultural, social, or economic. Rather, one has
to combine them all and add a few more traits-chiefly religion
and ways of living-to arrive at a more realistic concept of in-
digena.
And yet the indigenous groups are different-and sometimes
radically different-from the others, which are known generally
as ladinos. They participate only partially or periodically in the
commercial economy of the country, contributing mostly to a
domestic economy whose limited surplus is sold in local markets
to provide for the family needs. They have languages different
from the official Spanish language; the family and social struc-
ture differs greatly from the other groups; and their religion is in
many cases a paradoxical combination of Christianity and their
own ancestral religious beliefs.
Of the total inhabitants of Guatemala, 2,772,225 occupy two-
thirds of the territory, and the other 15,897 are scattered
throughout the Department of Pet&n, which, as has been said be-
fore, represents almost one-third of the total area of the republic.
The general density of population is 25.6 inhabitants per square
kilometer, but the figure for the Department of Peten is only 0.4
inhabitants per square kilometer. This gives the rest of the coun-
try a density of population of nearly 38 inhabitants per square
kilometer. Of the total population, some 1,863,091 persons,
equivalent to about two-thirds, live in areas at an altitude of
4,500 or more feet, although the whole area at this altitude is
less than one-third of the total area of the country.
Languages and Illiteracy.-Although Spanish is the official
language in Guatemala, the indigenous population speaks its own

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languages, which number about twenty, and are distributed in
the following groups: (1) Quiche, (2) Mam, (3) Pocomam,
(4) Chol, (5) Maya, and (6) Caribe. With a vigor that clearly
shows their cultural value, these languages have resisted the
penetration of four centuries of official use of the Spanish idiom.
The Indian groups still use them exclusively as maternal lan-
guages, for the majority either will not or cannot utilize Spanish.
It is easily perceived that this situation presents innumerable
cultural, socio-economic, juridical, and political problems, for al-
though the official language (official for the ladino) is Spanish,
in reality there are more than twenty tongues in present use, and
actually very large sectors of the population cannot express
themselves in Spanish.
According to the preliminary tabulations of the 1950 census,
it is estimated that the percentage of illiterates of more than
seven years is 72.2; the least illiteracy is found in the Department
of Guatemala with 41.1 per cent, and the maximum in Alta
Verapaz, where illiteracy reaches 92.5 per cent. The dominance
of indigenous languages in many zones has demonstrated that
the attack on illiteracy must be performed with the aid and
through the use of native languages, and not only Spanish. This
requires extensive efforts in linguistic research and much larger
human and material resources than an ordinary literacy cam-
paign, when there is a common language for the whole popu-
lation.
Economy and Finance.-Three fundamental branches can be
found in the Guatemalan economy: (1) production of basic
foodstuffs and prime materials for domestic consumption; (2)
production of crops for export, principally coffee and bananas;
and (3) industrial production, which includes the manufactur-
ing of food articles as a complement to agricultural production,
and the manufacturing of consumer goods like textiles, leather
products, constructio-A materials, and others, as well as the in-
come from public services in transportation, banking, commerce,
and the tourist industry.

RESOURCES AND PRODUCTION

71

Agriculture represents almost 60 per cent of the total national
output and is the structural basis for the foodstuff industries,
which in turn constitute one-third of the total industrial sector.
The Guatemalan economy is, therefore, predominantly agricul-
tural and depends on importation to satisfy the needs for manu-
factured consumer goods.
According to the latest data compiled by the Department of
Economic Research of the Bank of Guatemala, the total national
output, at current prices for the ten-year period 1943 to 1952,
rose from Q.131.6 million in 1943, to Q.541.9 million in 1952.
One must keep in mind that the quetzal is on par with the
United States dollar. In other words, in the last ten years, the
total national output has increased more than four times, which
gives an idea of the rapidly expanding economy of the country.
Within the Guatemalan economy, a division must be made
between the economic activity of the indigenous and nonin-
digenous populations. Its fundamental difference-from this
point of view-arises from a fact already stated, namely, that the
indigenous population participates only partially or seasonally
in the commercial economy of the country. As has been pointed
out in a recent study of the finances of Guatemala, the typical
indigenous family obtains a considerable part of its livelihood
from a domestic economy that consists mainly in the growing of
basic foodstuffs and the weaving of textiles for family use. This
economy is somewhat modified by the exchange of surplus crops
and articles in local markets. The seasonal employment of a
member of the family in the commercial sector of the economy,
principally on the coffee farms, serves the purpose of completing
the domestic economy. To the salary are added payments in
kind, chiefly corn, beans, and rice.
The indigenous part of the population participates, in a very
limited way, in the commercial economy of the country; and
this fact, plus the primitive methods of production, gives as a
result a substantial difference between the per capital income and
standard of living of the indigenous and nonindigenous groups.

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According to another recent study, the value of the gross na-
tional product of the republic for the fiscal year from July, 1949,
to the end of June, 1950, was Q.444.8 million, divided into the
following principal items of income: agriculture with Q.203.2
million; industry with Q.91.4 million; transport and communi-
cations with Q.70.0 million; commerce with Q.37.9 million;
and government with Q.31.9 million. Of the total gross product,
45 per cent belongs to the rural population, which in turn rep-
resents 68.4 per cent of the population; and 55 per cent belongs
to the urban population, which represents only 31.6 per cent of
the total number of inhabitants.
The per-capita income of the population taken as a whole
was, at that time, Q.160.66 per year; but, of course, the per-
capita income of the rural population was considerably lower
than that of the urban population, the former being Q.89.65 per
year and the latter Q.311.14. Although in every country there
generally is a marked difference between the per-capita income
of rural and urban populations, one must note that in Guate-
mala this difference takes on considerable significance. The
Guatemalan per-capita income is similar to that of the countries
in Latin America which have the same basic economic condi-
tions, but is, of course, strikingly lower than, for instance, that
of other nations like Great Britain, Switzerland, and the United
States.
Production for export is made up mainly of coffee, bananas,
abaca, chicle gum, essential oils, cocoa, and fine woods. Coffee
is still by far the most important product of the country. In
1948, for example, it represented 61.2 per cent of the total ex-
ports; bananas, 20.6 per cent; hardwoods and others, 11.6 per
cent; chicle, 4.9 per cent; and essential oils, 1.7 per cent.
The budget of the government for 1953-1954 totals Q.74.6
million. The most important of its sources of income are duties
on imported merchandise, taxes on alcohol and alcoholic bever-
ages, taxes on cigarettes and tobacco, export duties on coffee,
and a profit tax on enterprises. Fiscal expenditures increased

RESOURCES AND PRODUCTION

73

from Q.12.7 million in 1937-1938, to Q.51.1 million in 1947-
1948, and to Q.74.6 million in 1953-1954. From 1943-1944 to
the present budget year, the increase has been significant-from
a total budget of Q.16.9 million in the former year to Q.74.6
million in the latter. This means an increase of nearly four and
one-half times in the past ten years.
Other sources of government income are: taxes and contri-
butions; public services; income from state property, products
of state establishments, or articles monopolized by the state; and
others of different nature. In the year 1948-1949, more than
40 per cent of the taxes and contributions came from import
duties and more than 25 per cent from internal excise duties.
In violent contrast to these figures, direct taxes provided only
10 per cent of the total contributions. There is as yet no system
of income tax, but congress already has under study an income
tax law, and it is understood that it will be enacted in 1954. The
per-capita contribution in Guatemala was only Q.12 in 1948,
equivalent to 9.3 per cent of the personal income. This figure is
similar in percentage value to that of many other Latin Amer-
ican countries. In 1953, the per-capita contribution had mounted
to Q.22 per year, which represents an increase of nearly 90 per
cent in five years.
The balance of trade has maintained Guatemala in a favor-
able financial position. The currency is named quetzal, after the
famous bird which is the national symbol of liberty; it is equi-
valent to the dollar, as was stated above. Guatemala is one of
the few Latin American countries with a strong, well-backed,
and stable currency. No change in the value of the currency has
occurred since 1924-1926, when a monetary reform was carried
out. As a result of its solvent finances, Guatemala has no ex-
change control; and there are no limitations in securing foreign
currencies for payments.
Some Other Socio-Economic Aspects.-Of the total territory,
only 18.6 per cent is occupied by farms or agricultural enter-
prises; 37.3 per cent is occupied by towns, roads, lakes, and

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rivers; 29 per cent is formed by the forests of the Pet&n; 12.1 per
cent consists of forest and brush on private property; and 3 per
cent is unusable land. As can be immediately perceived, the
agricultural phase of Guatemala's economy depends on a very
small portion of the territory, representing only 18.6 per cent
of the total.
Land also is distributed quite uneconomically. In a total
number of 341,191 Guatemalan farms or agricultural units,
259,169 (representing 76 per cent), are very small holdings of
from 1.75 to 5.75 acres each. Therefore, 76 per cent of all the
agricultural units or farms represent only one-tenth of the land
occupied by agricultural enterprises. At the same time, 22 large
farms of more than 22,400 acres have a total acreage greater
than 259,169 small holdings, and 7,446 farms of medium to
large size represent 60 per cent more land than the 259,169 small
holdings. These results from the agricultural census taken in 1950
showed that two vast problems arising out of this situation are
the existence, on the one hand, of very large farms and, on the
other hand, of a considerable number of extremely small agricul-
tural units.
Another important aspect of this question is the human rela-
tionship to the land. Of the 341,191 agricultural units, 46.6 per
cent were operated by their owners; 8.8 per cent were operated
under the immediate direction of partial owners who own part
of the land and who rent, use, or occupy the rest; 16.4 per cent
were operated by tenants; 12.6 per cent were operated by farm
hands for their own use; 3.9 per cent were operated by occu-
pants; and 5.9 per cent were run by common joint holders of
a tenure of land.
The conditions of work of farm hands offer a wide variety of
situations which are illustrated in the figures obtained in 1952
by the Statistical Bureau of Guatemala (Direccion General de
Estadistica). These range from cases in which the agricultural
worker was paid a daily wage of 10 centavos without any other
benefits in kind, was given a small piece of land to cultivate un-

RESOURCES AND PRODUCTION 75
der the obligation of giving the owner 1 quintal (101.4 pounds)
of the crop, and was required to work forty-five days without
payment for the owner; to the case where the agricultural worker
was paid 80 centavos a day, received an adequate and free supply
of corn, beans, salt, and lime, enough land to cultivate on his
own, and living quarters.
It is obvious that agricultural wages are still quite insufficient
to promote the welfare of the rural population and to give it the
means to participate more actively in the commercial economy
of the country. On the other hand, one must point out that the
productivity of the agricultural worker is not high; and this
makes it imperative to raise his wages and also his contribution
to the production process.
Welfare and Sanitation.-It is impossible, within the limits of
this short paper, to analyze the extremely complex problems of
the welfare and sanitation of Guatemala; and even the data
which are included below are hardly enough to give a panoramic
perspective of the problem. This paper should be taken only
as a preview which may incite further and more detailed study.
Malaria and intestinal parasitic infections are the most im-
portant endemic diseases; they not only account for high rates
of mortality, but also have a decisive influence on the productiv-
ity of the population. Innumerable hours of work are lost on
account of these illnesses, while, at the same time, the persons af-
flicted with them lose a considerable amount of their energy and
working capacity. Serving the country are thirty public hospitals,
six hospitals subsidized by national funds, and three private
hospitals. In addition, there are quite a number of private clinics.
Treatment in the national hospitals is entirely free, but there are
also reserved accommodations for those who can pay.
The total number of medical doctors is 497, which gives a
general average of one doctor per 6,060 (the population estimate
for 1952 being 3,011,708). Of the total number of physicians,
381 are concentrated in the capital of the republic and only
116 (23.3 per cent) are distributed throughout the rest of the

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country. This is the reason why, in the city of Guatemala, there
is an average of one doctor for about 800 persons. In some ex-
treme cases, as happens in the Department of Huehuetenango,
the situation reaches the astronomical figure of one doctor for
every 110,836 persons.
It must be indicated that our University of San Carlos, which
is one of the oldest of the Western Hemisphere, has an excellent
school of medicine; but its output has not been enough to close
the gap between the needs of the population and the number of
doctors. Another serious problem is that most of the indigenous
population, and a large percentage of the so-called ladinos, do
not favor consulting physicians, either because they do not have
the means to do it, or because they would much rather trust
their own home remedies or take the advice of local witch
doctors.
The standard of efficiency in the medical profession is high;
especially is it true that in the city of Guatemala there are ex-
tremely capable physicians, who have done postgraduate work
outside of the country, chiefly in the United States and Europe.
What has been said about physicians can also be applied to
nurses, midwives, dentists, pharmacists, and laboratory techni-
cians. The city of Guatemala has good facilities and a sufficient
number of these professionals; but the rest of the country is in
dire need of an adequate proportion. Most of these professional
people will have to be subsidized by the government and by local
institutions, because a great percentage of the population does
not have an economic capacity to pay for their services and will
not come for consultations. This is one reason why the problem
of "socialized medicine" or "subsidized medicine" cannot be dis-
cussed in a general way, but only according to the special struc-
ture and the conditions in each country.
Although 9 per cent of the ordinary budget of the country is
destined to go to welfare and sanitation, this is absolutely in-
sufficient if the country is to carry out a successful campaign
against the endemic diseases that plague the population.

RESOURCES AND PRODUCTION

77

The general mortality rate in the past five years has been as
follows: 23.2 per cent in 1948; 21.5 per cent in 1949; 21.6 per
cent in 1950; 19.3 per cent in 1951; and 23.9 per cent in 1952.
This indicates the mortality for every 1,000 babies born alive.
The infant mortality rate (infants of less than one year of age)
in the same period of five years has been as follows: 11.7 per
cent in 1948; 10.1 per cent in 1949; 10.7 per cent in 1950; 9.2
per cent in 1951; and 11.2 per cent in 1952. These figures, and
especially the ones concerning the infant mortality rate, reveal
the seriousness of the problem. The rates are similar to those of
countries in America, Europe, and Asia which have conditions
like our own; but they are still extremely high, and are in them-
selves a clear indication that more and more attention should
be given to the health problem.
In a very general way, these are some of the outstanding facts
and problems about Guatemala. They also approximate the real-
ity and problems of many other nations of the Spanish-, Portu-
guese-, and French-speaking parts of America.

II

Let us now glance at some of the measures taken by my coun-
try in regard to the most pressing of its problems, so that we may
have a rough idea of the changes that have taken place already
or are bound to occur in many other Latin American areas. But
first, I must say that the nature of this paper is merely descrip-
tive and, in some cases, analytical; certainly it is not our purpose
to make judgments or to offer a positive or negative evaluation
of facts. We intend to present a picture of the most important
elements so as to give readers an opportunity to elaborate their
own conclusions and, we hope, the incentive to probe more deep-
ly into the matter.
The Constitution of 1945.-As in most written constitutions,
there are found, in the Guatemalan fundamental charter, two
principal parts: the dogmatic part, and the organic part. The

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former includes declarative principles in regard to the public,
nationality, citizenship, and fundamental rights of those who live
within the boundaries of the nation. The second part refers to
the structure of the state and prescribes the general norms in
regard to the organization of the legislative, executive, and judi-
cial branches.
In the dogmatic part, consisting of four chapters, there can
be observed two prominent and seemingly contradictory tenden-
cies, which reflect the care of the legislators in regard to the
necessity of guaranteeing at one and the same time the rights of
the individual and the rights of society. In effect, the fundamen-
tal rights of the individual are emphasized, sometimes with a
detail that would seem immaterial were it not for local and
historical considerations; but immediately following we find
chapters dedicated to the rights of the family, the workers, and
the public servants, and to culture. Protection is given with
equal care to the individual and to those rights which are be-
lieved to be inherent in his personal dignity; but at the same
time there can be found principles of great social sensibility,
which seek to preserve the social rights of the worker and the
family-never before recognized in the Guatemalan constitution.
The text was written and enacted in a moment of great patri-
otic enthusiasm and marked idealism; it will stand in the legal
history of Latin America as a generous effort to obtain through
law what historical events should have straightened out before.
While many of the provisions in the constitution are outstand-
ing, we shall present here only a few examples. Dual nationality
is expected for those born in other Central American republics,
so that Salvadoreans, Hondurans, Nicaraguans, and Costa Ri-
cans, by the mere event of establishing their domiciles in Guate-
mala, acquire Guatemalan nationality without losing their own,
unless they expressly waive this privilege. In economic matters,
the constitution establishes that land that is the property of the
state cannot be sold but only leased or given for useful exploita-
tion. The emphatic prohibition regarding presidential re-election

RESOURCES AND PRODUCTION

79

exists in order to prevent the president in power from using the
machinery of government to perpetuate himself in the highest
office-as has happened many times in the past. There is a
prohibition against the establishment of enterprises that absorb
or tend to monopolize one or more branches of industry. There
is created the post of Chief of the Armed Forces, so as to have a
person other than the president of the republic in control of the
army. There is a limited parliamentary regime, stated in such a
way that congress has the power to force the resignation of a
minister by a vote of "no confidence," even though he might
have been named by the president and not by congress.
Labor Legislation.-On May 1, 1947, Guatemala's first labor
Code was enacted. The workers were given the right to organize
unions, to demand better economic and social conditions, to ob-
tain compensation in case of unjustified dismissal, and to have
other protections; labor courts were established, as were depart-
ments and offices of inspection, to see that labor laws are obeyed
and also to register all the pertinent facts related to labor matters.
It is evident at the present time that social legislation has not
penetrated sufficiently in all parts of the population. Many of its
principles still remain, and will remain for quite some time,
without a general and effective application. In addition, this
legislation has raised considerable protest and resistance from em-
ployers, who do not believe that the law should be protective of
the workers' rights to the extent that the code prescribes.
Social Security.-Prior to January, 1948, when the Social Se-
curity System was inaugurated, the workers had no protection in
case of accidents, illness, old age, or incapacity. The Social
Security System was carefully planned in such a way as to start
with protection, in case of accidents, for groups of workers in
certain economic zones of the nation. From there it has been
extended to other parts of the country in accordance with medi-
cal, hospital, and socio-economic facilities. Very recently, the
system launched the plan for maternity benefits in the city of
Guatemala by providing an excellent hospital with outstanding

80

The Caribbean

equipment. In a very short time, the Social Security System
has grown into one of the most important institutions of the
country, in regard to the services it renders and the magnitude
of its finances, hospitals, and medical facilities.
At the beginning of the Social Security System, the medical
profession made considerable resistance to it, claiming it was a
danger to the free exercise of medicine. However, as time has
passed, it has come to be accepted with less apprehension be-
cause, instead of socializing medicine for those who can afford
to see a doctor privately, it has brought great sectors of the
population, which did not have the economic means to pay for
medical services, under the care of the staff of physicians em-
ployed by the system. Employers have offered less opposition to
the Social Security System than to labor legislation, although
they vigorously claim that contributions could be reduced if
more efficient administrative methods were employed.
The budget of the Institute of Social Security for the year
1951-1952 totaled Q.4.06 million, based on contributions from
the state, the employer, and the workers themselves. Major ex-
penditures were paid for benefits, administration, and new equip-
ment and organizational functions, while Q.587.4 thousand
were accumulated in reserve funds. During that period, the insti-
tute took care of 35,329 people who suffered accidents and
provided medical treatment and hospital care for 32,856 emer-
gency and first-aid cases. It also accorded financial benefits to
32,621 of those who suffered accidents. This medical attention
is provided by no less than 150 doctors who make up the staff of
the Institute of Social Security.
Agrarian Reform.-The main concern of Guatemala is agrar-
ian and agricultural: agrarian in the sense that land distribution
was and still is inadequate, and agricultural because the wealth
of the country, up to now, depends on products of this type.
In order to remedy the inadequate distribution of the land,
the government enacted, on June 17, 1952, the Agrarian Reform
Law, the main provisions of which are here characterized. (1)

	Cover
	Title Page
	Contributors
	Foreword
	Table of Contents
	Introduction
	Part I: Introduction
	Part II: Resources and product...
	Part III: Manufacturing and...
	Part IV: Transportation and...
	Part V: Labor and industry
	Part VI: Culture and the econo...
	Index

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