GENERAL: KUGOWN OPERATIONS - SPECIFIC: ORRISON REPORTS (W/ATTACHMENTS)

Created: 4/22/1954

OCR scan of the original document, errors are possible

Air

ife stern Hemisphere division

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Lincoln Guatemala

uateraalair.colniles

CIA HISTORICAL REVIEW PROGRAM RELEASE AS SANITIZED

Re: Guatemala

cement company in Guatemala is rolled "Carlos r.la. Patriceento, originally formed by the late Cerlos V. Novella and pres* itly run by the tro eons, Ing. Estuardo Novella C, Manager and Enrlouesst. Mgr.

On previous Missions to Guatemala, anti-cosmuMst elementsto n- that Estuaroo Novellaanti-communist enJthan one person had offeredno to him In *ny role asti-eownunist. urned offerso business with Novella

elt thet it might not b* ix tee two.

In thes'l always talked in generelitiecv-lln about conditions in thy country and ?luays sung the same tune ebout how brd things vere; the (roverr.mont was ti-ylng to put them out of business byos*<i'ol* labor de-wads, etc.

lastaw himpn connection with

telked to binft bout condone. Ketly

bv Indicating tbet thinn were not too bad. hi*

turned to Estnaurdo and told him that "relleccr" sae in the down-

office with he and crotl-.cr :'i .unue, theytheir

Itior contract for their workers. Ofretendedconcerning fellecer ana he "ssit on to iellut his tftround.

however, heer>by stringr, Spite of the fact bheta knoni memberiust Purtrt t'round hliu to he culte fair. tated that he listened to both sices of th*sror nnc aanagement -snd that his decisions did not par vIly fnvor either side; that hie decisions were usually fair *nd Just.

CcfcuardOn tc ?tate that conditions seeaed to b* snakingthe courtry and thett leirly optimistic for thftheir own problemsto be stabilizingatthey could no* begin tr -len ?heec. old hinepr-srnt cufte etinen he had always toldthe pest thet conditions were intolerable end thry did not the? tou).H be able lr in DUelnetta under th* j or It .of labor, 'iy the government, et al. herue but thet -orditionschanging andnoepftand th-ir problems and

with th-m.

At one time the government had actuallyan to Europe to' etudy cement plant practice, costs, etc, withovernment cementt competitive with the hovelloa. Since the domestic demand is only sufficient to support oneith possible, future cxpunaion this would have run" them out of business, fie stated that this project has now been abandoned.

fit la my opinion that tho above change of attitude, if alaoamong other business-men, la quiteannot 'say Just how far this has gonenly spent one day Inbefore going north and one after returning. About half of my time was taken up with Panjulid not see too manym listing some of the reactions below. Actually, peoples* attitude seems to run the entire gamut of Novellas' attitude down toward the cry that things could be no worse,

Rene Wlllemson, Manufacturers Representative: stated that things were never better; that he did not have enough time to talge care of everything.

"Pop" Rudar, Manager, Tropical Radio Telegrapheemed to feel that things were about the same or better.

"Cloyde Smith, Manager, Hotel Panamerican: stated that it was worse than ever.

Arturo Bianchi, Panjul partner (raiilrtn business,eemed to be riding high.

While In one of my conferences with Fanjul he asked menew the Manager In Guatemalt of theuerza (Electricho he feltery nice fellow, he told oe that when they had begun their talks with them about higher wages, etc. that the Manager had flatly refused. Fanjul says that now he has come back, beggingompromise but that they, thahas refused to mske any more concessions.

Panjul states that they consider themselvesife andwith the Fruit company and the railroad and thatnot Intend to budge until they have eliminatedrates and other abftses. He feels that the new port oncoast, coupled with the new highway paralleling thehelp greatlybreak tha monopoly of the Railroad.that tho Port would be finished this year, possiblyschedule, and at least ahead of the highway. Ha thinkswill request bids from contractors for paving the mof highway that will stillhe timeIs ready. He wants me to getbid on the Job.

J

U

>amuel

Orrlson

He: rAH-AMERICAN LiFJi INSUKANCK CO.

route to Hew York, tetween planead dinner in Mow Orleans with ar. old friend Fritzindley end wife, Martha. Lindley la Superintendent, Latin Amtrican Division for subject company.

I'r. Lindley mentioned to n* that they were going back Intoand asked mehought Rbout it* old him thet In my opinion any American investor should think twice before Investing money In Guatemala at thin time; not only because of the risk due to the shaky conmunlst government, but also because thoy would beroat deal of aid and comfort to athat was known to be communist domLnated, but also was an outspoken enemy of tbe United States.

Ho seemed to take my comments to heart and said that possibly they would be hetter off to wait and see what develops there. old him that they would probably be much safer to wait and they should certelnly give sariouB consideration to tha un-patrlotic Aspects of such an Investment at this time; that tho government was not only politically unntable but was also financially in bed shape and tliat an investment on their part might well be of great aid inovernment, enemy to.

It ls my suggestion that our organization take steps throughecure medium to contact either Mr. lindley or some top official f subject company and scare them off for the present. m sure you will agree that several million dollars Investedompany with thn fine name of this one woulderious blow to our anti-communist program. tep would undoubte-il_ be ^iven wide publicity by the Guotemaltecan government as proof that they are highly regarded in the bent circles of American flnrnce and might very well encourage other Investors to come in. o not believe that it would be to our advantage to see the economy of Guatemole strengthen'd at this time.

Original document.

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