WESTERN HEMISPHERE: THE ECONOMICS OF VESTIGIAL COLONIALISM

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001700020033-2
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 16
• Document Creation Date: December 22, 2016
• Document Release Date: March 2, 2010
• Sequence Number: 33
• Publication Date: September 1, 1971
• Content Type: IM

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C~~~ ~ 2 ~'~-~ ~'/ 7 ~'_' / 25X1
7
Confidential
DIRECTORATE OF
INTELLIGENCE
Intelligence 10~1emorandum
Wlestern Hemisphere: The Economics Of Yestigidl Colonialism
Confidential
ER IM 71-179
September 1971
Copy No. ?~'
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~J~.~~.1~. ~ I N G
't'his document contains in:orznation affecting the natinnal
defense of the United States, ~vitlun the meaning of Title
18, SCCtiOi)5 i93 and i~4, of the US Code, as amended.
lts Uansmission or revelation of its contents to o~ re-
ceipt by au llnFlllthOrl7.ed l)e2'SOll is prohibited by Jaw.
^FOUP 1
Faclvded Isom ou~ommie
downgrodinq mid
dednuifiwiion
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CENTRAL INTELLIGENCE AGENCY
Directorate of Intelligence
September 1971
WESTERN HEMISPHERE:
THE ECONOMICS ?1F VESTIGIAL COLONIALISM
Introduction
1. The Western Hemisphere retains the largest number of remnants
of European colonial empires of any major geographic area. Their number
poses the question of what economic and other factors are operating to
:ind them to their mother countries - the United Kingdom, the
Netherlands, and France -and delay their independence. In contrast, many
former European possessions in Africa and Asia have become sovereign states
since World War II. This memorandum examines the economic
characteristics of Europe's Western Hemisphere possessions and their
relations with the mother country. It also assesses their recent economic
trends and outlook, as well as other factors affecting their prospects for
gaining independence during the next several years.
Discussion
Europe and Its Western Hemisphere Possessions
2. The present-day remnants of Europe's once-great colonial empires
in the Western Hemisphere embrace a total land area of some 111,000 square
miles -about the size of Arizona -- and a population of 2.3 million persons,
mostly black or mulatto. They are characterized by narrow resource bases,
tiny markets, and heavy dependence on imports. Moreover, there are strong
population pressures in the case of the islands, which account for 75% of
the population but only 10% of the land area.
3. The possessions contribute little economically to `heir mother
countries, and many of them have become financial burdens. They are
Note: This memorandum was prepared by the Office of Ecvrromic
Research and coordinated within the Directorate of Irttelligerr^e.
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neither important sources of raw materials nor significant markets for
manufactures. European direct investments in them -and thus profit
remittances -are generally small. The more prosperous British and Dutch
territories are more closely oriented economically to the United States than
to Europe. At the same time, mast of the territories are dependent on
economic aid from their mother countries for infrastructure development
and also need budget support to help provide educational and other services.
Britain's Dependencies
4. Britain's remaining possessions -the British West Indies ~ and
the crown colonies of Bermuda, British Honduras, and the Falkland
Islands 2/ (see the map) -are the most numerous, although making up
only 17% of the land area and about 40% of the population of the
European's colonial areas. 3/ ?,:side from sentimental attachments and small
receipts of economic aid, the possessions have few ties with the United
Kingdom. Only the Falkland Islands has a population of predominantly
European origin. Whites make up only about one-third of the population
in Bermuda, 25% in the Cayman Islands, 10?Jo in the Bahamas, and 1%-2%
in the remaining possessions (see the table). Britain exercises relatively little
political and economic control over its dependencies. All continue to have
London-appointed royal governors, but the granting of full autonomy in
all but foreign affairs and external security, mainly in the last decade, has
left the governors as little more than figureheads.
5. British investments, while larger than those of the other mother
countries, are overshadowed by rising US investments in the Caribbean.
Small agricultural processing plants, public utilities and transportation,
trading outlets, and tourist facilities have received most UK funds. In the
Vlindward and Leeward Islands and, to a lesser extent, in British I-Ionduras,
1. As used itt this memorandum, the term British West Indies embraces:
(a) the crown colonies of the Bahamas, the Cayman Islands, the Turks and
Caicos Islands (a dependenev of the Bahamas since 1965), and the British
Virgin Islands and Montserrat in the Leer~ard Islands; and rb) the individual
Associated States of L'ominica, St. Lucia, St. Vitrcent, and Grert~zda in the
i-i~indward Islands, attd Atttigtta at:d St. Kitts-Nevis-Artgttilla itt the Leeward
Islat:ds.
2. Also kttowtr as the Malvinas, these islartc?s Itave been claimed by
Argentina since 1833.
3. The four riost ecottom.fcally and politically v(~?;le of Britain's
long-standing passzssiorts in the Hemisphere gained their independence
during the : ~60s, as follows: Jamaica attd Trinidad attd Tobago, 1962;
Guyana r,;rd Barbados, 1966.
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European Dependencies in the Western Hemisphere
~' ~ a !siand~
~V
r British
- .Ji Honduras
Guatemala` "~~"'~~--
~Honduras
-~_~ ~.
E7 Sal~tadorl
Nicaragua
mil,
Costa',
`-~?%~ Rica` _
`~ 1 `~
/~
~~-
~:~,~ Panarrla`
Red United Kingdom
Green France
Brown Ttte Netherlands
Bermuda
e
., Turks and
'? ~ Caicos tslanos
British Virgin -
Puarto Islands
Rico /
;`--"-St'Eustatius.',St. Martin Fr ,,~,~r:w..
~-~ -baba -,_ # Antigua
St. Kitts- eMontserrat
Nevis-An~guiila GUad eIOU e
ee4 ~f- P
~ Bonaire
~-~.,
~- '~ rruracao
'~ r~ ~~,
~'v,? ~ Dominica
~ Martinique
" ! St. Lucia
~ ~Barbador:.
3 ~
t: St. Vincent
c
~ ~ Grenada
~ _, "Trinidad entl
St. Pierre and
Miquelon
_ - _ 1
I
Falkland
Islands
S_ urinam
- French
'..`Guiana
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Of Euro-
Value of
Net
Value of
Unem-
Economic
Aid,
Area
Number
Growth
Rate
pean
Origin
Per
Capita
Imports Tourist Exports
(Million Earnings (Million
Principal
Prin-
cipal
ployment
Rate
Average
1967-69 b/
(Squaze
Miles)
(Thousand
Persons)
(Per-
cent)
(Per-
cent)
GNP
(US $)
US $
c.i.f.)
(Million
US $)
US $
f.o.b.)
Export
Items
Export
Market
(Per-
cent)
(Million
US $i
Netherl:nd~
to~riteries
Surinam
55,100
417_
3.5
1
580
99
Negl.
113
9auxite,
United
20
11
Netherlands
349
224
1.4
10
1,200
184 c/
16
193 d
/
alumina
Petroleum
States
United
12
16
Antilles
French overseas
_
products
States
department
French Guiana
35,100
52
4.3
2
840
52
Negl.
3
Shrimp,.
United
10
20
?
French West
1,120
672
2.7
5
550
234
N.A.
71
timber
Sugar,
States
France
25
117
ladies ~
French territory
St. Pierre and
Miquelon
British dependencies
Bahamas 1
93
4,566
5
183
N.A.
3.4 ff
100
10
N.A.
1,400 g/
N.A.
251
N.A.
155
N.A.
46
bananas,
rum
Codfish
Petroleum
France
UniteZ
Negl.
9
3
N_egl.
Bermuda
21
53
2.0
37
2,200 of
85
65
3 h/
products,
cement,
rum
Cut
States
United
Neql.
Negl.
British Honduras
8,870
123
2.9
2
380
30
2
17
flowers
Sugar,
States
United
25
5
citrus
fruits
States
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Europe's Western Hemisphere Possessions: Economic Data a/
~Ccntinued)
Of Euro- Value of Net Value of
Growth pean Per Imports Tourist Exports
Area Number Rate Origin Capita (Million Ea pings (Million Principal
(Square (Thousand (Per- (Per- GNP US $ (Million US $ Export
Miles) Pezsons) cent) cent) (US $) c.i.f.) US $) f.o.b.) Items
British Wind- E26 400 2.2 1 220 50 5 f 22 Bananas,
ward Islands sugaz
British Leeward 367 132 1.6 1 340 3A 10 f 8 Sugar,
Islands i/ molasses
Cayman island 100 11 N.A. 25 600 g/ 9 1 Negl. Rope
Falkland Islands 4,700 2 N.A. 100 N.A. 2 Negl. 2 Wool
a. Data are for the most recent yaar available, generally 1970 for population, 1969 for foreign
some of the per capita gross naiionaZ product estimates.
b. From mother countries only.
c. Excluding Bruce oil for refining.
d. Petroleum products are valued at the estimated refinery processing markup.
e. Including t:~e lurks and Caicos Islands (population, 7,000; area, 166 square miles).
f. Excluding immigration. Inclusion of immigration could increase the groc~th rate to 7S.
g. Estimated from fragmentary data.
h. Excluding re-exports.
i. Estimated.
j. Including the Br?tish Virgir. Islands (population, 11,000; area, 69 square miles).
Unem-
Prin- ployment
cipal Rate
Export (Per-
Market cent)
Economic
Aid,
Average
1967-69 b/
(Million
US $)
IInited 15-2~
Kingdom
United 15-25
Kingdom
Jamaica Neql. Negl.
United Negl. 1
Kingdom
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however, : orporation-owned plantations controlled by UK residents remain
economically dominant. Imports from the United Kingdom average about
$105 million annually, but exports to it total only about $~0 million.
Deliveries to Britain consist mainly of sugar and bananas sold under
Commonwealth trade preferences. The economies of t}~e Bahamas and
Bermuda are much more closely linked to the United Stales than to Britain.
The United States takes most of their very small exports and supplies most
of their imports; US tourist expenditures account for nearly all of their
relatively large foreign exchange earnings. US firms predominate in the
foreign holdings in the Bahamas and Bermuda; US investments in the
former -mainly in tourist facilities and infrastructure -amount to about
$1.2 billion, or nearly one-third of the Western Hemisphere total outside
of Canada.
6. British aid to its possessions totals only some $18 million
annually, about 90% of which is in the form of grants. Budget support
for current expenditures, which totaled $5.6 million in 1968, is limited
to the British Windward and Leeward Islands. In addition, all possessions
receive grants for capital projects, although the amounts going to the
Bahamas and Bermuda are negligible. In 1968, development grants
approximated $10 million and accounted for two-thirds or more of the
capital expenditures of the smaller possessions. Britain also provides funds
for salaries for some 3,000 educational and public administration personnel
and for the training ;n the United Kingdom of some 1,200 students annually.
The Netherlands' Territories
7. The Netherlands' possessions -Surinam (formerly Dutch Guiana)
on the South American mainland and the Netherlands Antilles ~ -are,
along with the Bahamas and Bermuda, the most important economically
of Europe's possessions in the Hemisphere. Surinam is a major source of
bauxite, and Curacao and Aruba have sizable petroleum refineries established
during 1915-28 by Royal Dutch Shell and Standard Oil of New Jersey to
process Venezuelan crude oil. Like the British dependencies, the
Netherlands' territories have full autonomy in domestic affairs, but they
retain greater economic and political ties to the mother country. Only about
5% of their population is of European origin. Although Dutch private
investments -primarily in petroleur,~ refining -are sizable and rising, they
are still smaller than US investments. Much of Surinam's bauxite is mined
4. These consist of Curacao (where thy; capital is located), Aruba, acid
Bonaire near the Yenezuelar: coast and the Leeward Islands of St. Eustatius,
Saba, and the southern half of St. Martin (the northern half belongs to
France and is included in the Department of Guadeloupe). About 90% of
the Netherlands Antilles' population resides in Curacao and Aruba.
- 6 -
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and processed by US firms, mainly for shipment to the United States and
Canada. The United Stites supplies some 47% of Surinam's imports,
compared with a European share of 36% (and a Dutch share of 20%).
Similarly, almost all Netherlands Antilles imports (excluding crude oil) come
from the United States, and oil exports, largely frozen out of Europe by
cheaper Middle Eastern supplies, go mostly to the United States.
8. Dutch aid to the Western Hemisphere territories .averaged about
$27 million annually during 1967-69, a fraction of The Hague's total foreign
aid outlays. About 60;'o goes to the Netherlands Antilles, ;about half as
grants and half as long-term loans; this aid is used mostly for infrastructure
development. The remainder, consisting primarily of grants, goes to
Surinam -mainly for investments in infrastructure, although an increasing
share has been allocated for supporting current outlays in the last 2-3 years.
Since 1965, Dutch aid to the two territories has been supplemented by
small grants from the European Development Fund (EDF) by virtue of
their status as associate members of the European Community.
France's Possessions
9. in sharp contrast to the United Kingdom and the Netherlands,
France has sought to maintain firm control and close economic ties with
its Western Hemisphere possessions. These consist of French Guiana on the
South American mainland, the French West Indies -Martinique in the
Wind~Nard Islands and Guadeloupe in the Leeward Islands -and St. Pierre
and Miquelon, off the coast of Nova Scotia. Although only 5% or less of
the populations of French Guiana, Martinique, and Guadeloupe are of
European origin - in sharp contrast to St. Pierre and Miquelon -France
made them overseas departments and conferred full French citizenship on
their populations in 1946. Especially in the last decade, moreover, Paris
has supplied aid liberally to boost education and other social services to
levels comparable to those in metropolitan France.
10. Reflecting high French-imposed tariffs on goods from other
countries, more than two-thirds of tl~e possessions' imports of some $290
million annually come from the mother country. The French market absorbs
a comparable share of their limited exports, mostly sugar, bananas, and
rum. Nevertheless, these possessions contribute little to the French
economy. French private investments, mostly i:i agricultural processing and
tourism, are very small. The products exported, for which France pays
subsidized prices, could be acquired more cheaply elsewhere. Paris' only
non-sentimental stake in the Hemisphere is its $100 million space center
in French Guiana, constructed during 1964-69 to replace a similar cer-ter
lost when Algeria gained its independence in 1962.
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1 1. French aid to its dependencies has grown substantially during the
past decade and is now fairly large. It averages some $140 million annually
and consists mainly of grants aimed at supporting both cu*rent and capital
expenditures. Some $117 million is distributed to Martinique and
Guadeloupe in approximately equal shares - a sum amou:iting to a
thumpii;g one-third of their combined gross national product. Another $20
million go.s to French Guiana, and the remaining $3 million is allocated
to St. Pierre and Miquelon. Apart from direct aid, Paris provides (at French
expense) an extensive civil service, which includes most of the professional
and clerical personnel as well as the bulk of the police forces. As a result
of their status as rrench overseas departments, the territories in the
Caribbean area receive small amounts of EDF aid.
Economic Structure and Trends
12. Poorly endowed for the most part with natural resources, Europe's
Western Hemisphere possessions engage in a narrow range of economic
activities, and most are experiencing economic stagnation and considerable
unemployment. Except for Surinam and possibly French Guiana, mineral
resources are almost nonexistent, and manufacturing remains little
developed. Gross national product (1NP) per capita ranges from an
estimated $2,200 annually in Bermuda to only $220 in the British Windward
Islands, Owing to their narrow resource bases and limited industrial
development, the possessions are dependent on imports for sizable shares
of their food and for nearly all of their manufactured consumer and capital
goods. Consequently, they have very high ratios of imports to GNP. The
ratio in Surinam, for example, is 40%, and in the Bahamas, ] 00%.
13. The economies of the Windward and Leeward Islands, French
Guiana, British Honduras, and the Falkland Islands rest on production of
a small number of agricultural products, chiefly sugar, bananas, rum, and
in the last case, wool; St. Pierre and Miquelon depends heavily on codfish.
Except for France's Caribbean possessions, economic growth in the
dependencies barely keeps pace with the population growth rates of
1.5%-4.0% annually. Aside from the Falkland Islands and St, Pierre and
Miquelot-, unemployment is high, ranging from 8%-10/0 of the labor force
in French Guiana to as high as 25% in some of the islands. Sparked by
French aid, real economic growth ij~ the French West Indies averaged some
5%-6% annually during much of the 1960x, and growth received a substani:al
boost in French Guiana during construction of the space center. In the
British Windward Islands, economic advance has been based on rising banana
sales to the United Kingdom, while in the British Leeward Island, expanding
tourist expenditures have helped to compensate for declining sugar
production.
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14. Aside from Surinam, the remaining possessions -Bermuda, the
Bahamas, the Cayman Islands, and the Netherlands Antilles -? are lacking
in agricultural resources. Tlie relative prosperity of Bermuda and the
Bahamas depends on US tourist expenditures -which rose from $114
million in 1966 to $190 million in 1970 -and on US investments in tourist
facilities. The two possessions also benefit from tax laws that have
encouraged numerous international companies to establish their nominal
]teadquarters there. The Bermudan economy, in addition, has been aided
by the presence of a US air force base, lease payments for which make
up about one-third of government revenues. Both colonies have some labor
shortages, partly because of immigration restrictions. I-Iowever, cu~backs in
tourist expenditures and investment in tourist facilities in the Bahamas in
1970-71 have resulted temporarily in an 8%-10% unemployment rate. 5/
Although the Cayman Islands' exports are negligible, remittances by subjects
employed in Caribbean-area merchant marines and in the United States,
together with moderate tourist earnings, have given the population a living
standard about average for the European possessions.
15. Surinam's economy rests on bauxite. Output reached 6 million
tons in 1970 -about 14% of the world total. Although one-fourth of the
labor force is engaged in agriculture, most farm workers are on subsistence
units. Orce a prosperous plantation economy, Surinam now has only small
agricultural exports and, like the rest of Europe's remaining possessions,
depends on imports for a large share of its food supplies. After experiencing
an economic boom during the mid-1960s, when large US investments were
made to expand bauxite production and to initiate alumina refining and
aluminum smelting, the economy slowed sharply in 1968-70, helping to
induce rising inflationary pressures. Although a sizable share of tl~e rapidly
growing labor force has been absorbed into government employment in the
last two or three years, the unemployment rate still is about 20%.
16. The Netherlands Antilles' long-standing prosperity derives almost
entirely from oil refining. The industry provides 52% 6/ of export earnings
and until the 1960s employed about one-third of tl~e labor force. After
a long period of expansion, refining capacity has stagnated since the
mid-1950s at about 800,000 barrels per day. Two factors were responsible:
expanded refining in Venezuela and restrictions on demand for Venezuelan
oil caused by US oil import restrictions and rising competition from Middle
Eastern suppliers. GNP probably declined in the first half of the 1960s
but has risen in the last 4-5 years because of invcsti~~cnts to modernize
6. Oil exports arc valued at tlrc estimated r?efruert~ procc.~ssing markup.
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the refineries, rising tourist earnings, and a small expansion of
manufacturing. Refinery modernization, however, had cut employment by
1970 to about one-fourth of its earlier peak, helping to boost unemployment
to about 12% of the labor force. The consequent downward pressure on
wages culminated in mid-1969 in a violent labor uprising with racial
overtones in Curacao. The dispute was settled by providing a large share
of the labor force with pay hikes of 20%?30%.
17. At least in part because of the generally poor living levels, there
have been relatively few internal pressures for full independence among
Europe's remaining Western Hemispher? possessions. Since World War II,
only four British possessions among some 20 European dependencies in
the Hemisphere have sought and gained independence. At the present time,
only three more -the Bahamas, British Honduras, and possibly Surinam -
are seriously contemplating such a move. As experience elsewhere has
shown, being very small in area and population does not necessarily keep
colonies from seeking full independence. The now-independent countries
of Barbados, Fiji, and Equatorial Africa, for example, are smaller than a
number of Europe's remaining possessions in the Western Hemisphere. As?de
from the economic weakness, the major factors restraining independence
pressures in the Western Hemisphere have been the lack of national
identities, owing partly to the varied origins of she populations and the
willingness of the mother countries in recent years either to grant full
autonomy in domestic matters, as in the British and Dutclt possessions,
or to provide generous economic aid, as in the French possessions.
18. The attitude of the mother countries has discouraged movement
toward full independence in the case of the Dutch and French possessions.
The Netherlands has warmly embraced its Western Hemisphere possessions
since the loss of Indonesia, whereas France leas vigorously repressed
independence activity. On the other hand, the United Kingdom precipitated
the hemisphere's only major independence movement in years through its
postwar policy of curtailing overseas commitments. In 1958 it formed the
West Indies Federation, including most of its island possessions in the
Caribbean area, in the hope that by combining the economically weak small
islands with the much stronger economies of Jamaica, Trinidad and Tobago,
and Barbados, the basis for a viable independent state could be
established. ~ The Federation lacked popular support within the territories,
7. Members of the West hrdies Federa?tia: consisted oJ'Ja?raica, Trinidad
a~td Tobago, Barbados, the Cayr:a~t Is/a~tds, t/re Turks a~td Caicos Isla~tds,
the British Windward Islands, and the British Leeward !sla~tds except the
~irgi~t Islands. Britain's other Caribhear:-area possessions chose to remain
separate.
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However, and London did not provide an}~ financial incentives to Help make
it work. Political rivalries among the ]]tree strong members and between
them and the smaller islands also arevented the Federation from becoming
a going concern, and in 1962 it foundered with the withdrawal of Jamaica
and Trinidad and Tobago to become independent states. Most of the
remaining possessions returned to their former statt:s as colonies, but six
of the Windward and L,ee~,v.~~d Islands became "associated states" of the
United Ki~igdom, retaining the option of becoming independent at will.
19. The European powers' benevolent policies have ]lelped to ease
racial frictions in the predominantly non-white possessions that could have
turned them against the mother countries as instruments of foreign white
domination. The granting of full local autonomy and the elii,~ination of
property and income restrictions on voting eligibility by the United
Kingdom and the Netherlands generally have permitted political control to
pass to the non-white majorities. In Bermuda, however, the dominant
political party is biracial, although white-controlled. Economic power,
nevertheless, has remained in white hands in nearly all the territories. This
circumstance recently has resulted in more frequent outbursts of racial
animosity throughout the area except for the French Caribbean possessions,
w}terc extensive inter-marriage has ]lelped to blur the race issue.
20. Racial animosity was a factor in pressures for independence in
tl~e four British possessions that have recently achieved it and has become
increasingly important in Surinam and to a lesser extent in the Bahamas.
Since 1967, small, radical black power movements have attempted to fan
racial antagonisms in most of the remaining possessions with a little success,
helping in varying degrees to precipitate outbreaks of racial violence in
Antigua (1968) and Bermuda (1968 and 1970). Nevertheless, the
independence issue has remained largely somnolent. In the French
possessions, serious pressures for change that have resulted in occasional
strikes and scattered violence in recent years ]lave been aimed merely at
gaining greater local autonomy from the French bureaucracy. The British
possessions' interest in independence and political federation may be
rekindled by black Prime Minister Forbes Burnham of Guyana, however.
Using the common bond of blackness as one potentially unifying theme,
Burnham organized a meeting of representatives from Guyana, Trinidad and
Tobago, and five of the six "associated states" of the British Windward
and Leeward Islands in July 1971. ~ Although the representatives reached
an agreement in principle on eventual federation, many formidable obstacles
remain.
~. The five include Dominica, Crenadu, St. Lucia, St. Vincent, a,ta St.
Kitts-Nevis-Anguilla. A representative of Antigua also attended us an
observer.
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Outlook and Conclusions
21, With few exceptions, the prospects for Europe's remaining
West;:rn Hemisphere possessions over the next several y:.ars are for
continuing stagnation in output and high unemployment levels. Their narrow
resource bases generally preclude investments that could significantly
stimulate economic growth. Since few of them export goods demanded by
the others, the recently-formed Caribbean Free Trade A~~,ociaticn
(CARIFTA..) 9/ is not likely to provide much benefit. The main hope of
most of the island possessions in trying to maintain economic advance
commensurate with population growth is to woo increasing numbers of US
tourists, along with investments in tourist facilities. But tourist earnings
remain highly vulnerable to racial violence, which could erupt without
warning at any time. Moreover, worldwide competition to attract tourists
is strong, and food and hotel prices in the area are relatively high. In sum,
per capita incomes and employment rates at best are likely to remain
substantially at present levels in most of the possessions over the next several
years.
22. The bleak economic outlook for most of the possessions
undoubtedly will help to put a damper on any new independence stirrings.
The next several years thus probably will not see a significant upswing in
the formation of new, independent states in the Western Hemisphere. At
the same time, there is little evidence that the mother countries' policies
will change. Britain will continue to pay lip service to independence but
probably will offer its possessions few financial inducements. The
Netherlands probably will stand ready as in the past to tolerate but not
encourage independence, and Paris will continue to vigorously r;;?press
independence activity on the part of any of its dependencies so foolhardy
as to envision sacrificing French aid.
23. Even the possessions now contemplating independence may move
slowly. Unless US tourist expenditures revive sharply in 1971-72, the
Bahamas, which has a 1973 independence target, may be forced into further
delays. Surinam's continuing financial and unemployment difficulties also
could cause it to postpone independence, set for 1975, despite the prospect
of a limited revivial of US bauxite and alumina investments in the next
year or so. Even the independence efforts of British Honduras, which have
not been hampered by economic difficulties, seem destined to be blocked
indefinitely by Guatemala's claims to its territory -claims that could be
deterred only by UK or possibly US border guarantees. Neither country
seems willing so far to provide such guarantees. As for a possible federation
9. Members of CARIFTA, which was established irr 1968, include:
Barbados, Cary:;rra, Jamaica, Trinidad and Tobago, Antigua, Dominica
Grenada, Montszrrat, St. Kitts-Nevis-Anguilla, St. Lucia, and St. Vincent.
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of the British Windward avid Leeward Islands with Guyana or Trinidad and
Tobago, past experience indicates that such efforts are likely to become
hung up on political rivalries unless Britain moves to provide strong financial
incentives to union.
24. The prospective entry of the tJnited Kingdom into the enlarged
European. Community (EC) is not likely to be a major factor in the decisions
of the British possessions to seek independence. Either as British
dependencies or as independent states of t;ie EC, their present preferences
in the British market probably would be replaced by similar EC preferences
and, under certain circunnstances, they would qualify for EDF economic
aid in addition to any obtainable from the United Kingdom.
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