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Mandatory Review . t'- f
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NATIONAL INTELLIGENCE^ESTI/vWEtA:.^
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Guyana (British Guiana)
DIRECTOR OF CENTRAL INTELLIGENCE Ciin by fh#
UNITED STATES INTELLIGENCE BOARD
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USAF ACTING EXECUTIVE SECRETARY, USIB
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The following intelligence organizations parinpreparation of The Centrol Intelligence Agency and Ihe. intelligence organizations ol Aoof Stote, Defense, and
Dr. R. J. Smith, lor Deputy Directorr. George C. Oenney,or The Director of Intelligence ond Research, Deport.
men.
lieuienont General Joseph F. Carroll, USAF, Director, Defense.Intelligence Agency Ueulenonl General Marsholl S. Carter,
Agency
Abstaining:
Dr. Charles H. Reichardl, lor Assistant General Manager for Administration,*
Mr. Williom O. Cregor. for Assistant Director, Federal Bureau of Investigation, the subject being outside of their '
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NATIONAL INTELLIGENCE ESTIMATE
Guyana (British Guiana)
GUYANA (BRITISH GUIANA)
THE PROBLEM
To estimate the prospects for Guyana over the next year or two. CONCLUSIONS
Guiana will probablyelatively smoothto independence, but racial suspicions between East Indianswill continue to dominate Guyanese politics.
(or whether) these tensions break out again intodepend in large measure on the conduct of Prime Ministerleader of the Negro party (thend of Cheddiof the East Indian party {theorear,governed with considerable restraint and Jagan has refrainedopposition- But new elections are due bynow and then tensions will rise and may at some pointof hand.
after British troops depart inforces can probably cope with sporadic violence. Ifout of control, Burnham would probably calleturn ofIf US consent were forthcoming and British troops werewe believe that London would comply.
governing coalition ofrofessed butsocialist, and the conservative United Force leader.will continue toenuous one. Friction betweenover patronage and fiscal issues will probably beindependence, but chances areommon fear ofhold the coalition together.
E. Cuyana's economy will need substantial foreign capital, much of it from the US. The need for aid will keep Burnham ou tolerable terms with tbe US, UK, and Canada, though his administration will inclineeutralist posture in foreignf Jagan came to power, be could, because of his Marxist sympathies and hisin Communist countries, count on some help from these countries. However, they probably would furnish only tokenof aid.
DISCUSSION I. THE SITUATION Background
After yean ol political aad racial strife. British Guiana will becomeonlthough tbe UK bad long desired to be rid of this underdeveloped, unprofitable and often troublesome colony, if wanted toeasonably stableH Tbe coalition which took office in4 persuaded tbe British that it gave promise of such stability, and inS terms for independence woe agreed to. The new country will be called Guyana; it willember of tbe Commonwealth; il willovernor-general, at least untilhereafter the new National Assembly may vole to change the countryepublic. Thespecifies that new national elections must be held by
Isolated Irom Its mainland neighbors by roadless expanses of forest and grassland. Guyana is La many ways like an island. Overercept ofnhabitants are concentrated in tbe intensively cultivated coastal region. This constitutes less thanercent of (be total area and in It the majorcommodities, rice and sugar, are grown. Bauxite deposits, whichCuyana's most reliable source of foreign exchange, are located in tbe interior. The economy suffers from ills that plague other underdevelopeddependenceewigh rate of unemployment, limited investment, inadequate transportation facilities,hortage oftrained personnel.
The two predominant ethnic groups arc the East Indians (who comprise aboutercent of the population) and the Negroes and mixed strains (abouthe remainder consists ol Amerindians, whites, and Chinese. The East Indiansigh birth rate and are the fastest growing part of the population. With the exception of an increasing number of business and professional men in Georgetown and other towns, they live in the country, working on their own small rice fields or on Urge British-owned sugarMost of them have remained Hiodu or Moslem. The Negroes areChristian, they tend to live in the towns and to work in the Sugar factories and bauxite mines. They hold most of the positions in the civil service and tbe police.
The Politics of Race
political life is dominated by considerations of race. TheCongressparty of Prime Minister Forbesbased on the Negro population, while the People's Progressiveled by former Premier Chcddi Jagan, depends on East Indiansmall third party, the United Forceuts across racial lines to appeal
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to conservative businessmen as well as to most voting Amerindians. It is. the political vehicle of Peter D'Aguiar, the present Finance Minister and Burnham's partner in the coalition.
The domuunil political figures continue to be Cheddi Jagan and Forbes Bumliam, once political allies in the PPP, but5 bitter rivals. Jagan's appeal to the East Indians, combined with tbe organizational talent of his US-bom wife, paved the way to PPP victories in the election*hen first in power, Jagan's general demeanor and ties withCommunist organizations antagonized the British, who removed him from office. He regained their respect by his moderate behavior, but after1 victory, his policies frightened the businessmen, and his open espousal of East Indian interests exacerbated raoa! tension. Burnham broke with tbe PPPnd7 had succeeded in organizing the PNColitical opposition to Jagan's programs was transformed into interracial violence. That year, as well as3his violence became so serious that Jagan had to appeal to the UK for troops.
Under these conditions of turbulence, the parties were never able to agreeolitical system for an independent Guyana. Finally in'Aguiar. Burnham. and Jaganoint statement agreeing to accept whatever political solution tbe British Colonial Secretary might devise. The latter, to Jagan's dismay.ecree changing the electoral system from plurality elections in each constituency to country-wide proportionalIn the4 election, the PPP8 percent of the vote andheercent andeats, and tbe4 percenteats. By joiningoalition, tbe UF and the PNC were able toovernment whichajority of the legislature.
The Present Coalition
the turmoil of the Jagan years, the coalitioa government hasstability than many observers had dared hope for. Burnham hasconsiderable restraint In the political Geld and hasumberto mollify the fears of the East Indians. The confidence of tbehas been largely restored, and economic growth, which hadwith3 disorders, seems now to have started up again.1Jagan government's policies discouraged private Investment. Burnhamsought it to help underwrite his recently drafted seven yearplan. Though Bumham's hopes are over-optimistic, hisillion in private investment, chiefly foreign. It also callsaid to help finance public sector expenditures of approximately
' TKough tiuee ol thwe PPP roetoben new luiu imdVpcodcnn, ihey eaiitlaue to vote on many occasions with their former party.
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& 'Kid the coalition itself there arc strains. Significant personal and political differences separaterofessed but pragmatic socialist, from D'Aguiar, his conservative bsisuiesi-orieoted Finance Minister. Their coeLoon is largely held togetherommon fear of Jagan's return to power.evotionalanced budget has clashed with Burnham's schemes involving deficit spending as well as bis continuance of subsidies to the East Indian rice growers D'Aguiar fears that Burnham will be harder to deal with after the British leave.
present, public order is maintainedolice force ofan reserve. They are supportedattalion ofwhich is scheduled to leave onfterewother ranks will stay on to train the new Cuyana Defense ForceCDF will eventually consistattalion ofen, whichhope will be fully trained by. These units are to be racially balanced and eventuallyofficers, but at present no Guyanese arc sufficiently trained tosenior officers In the CDF. Until they are trained, the British willnecessary officers, including the comoiandor.
strength of the police force is scheduled to increase toend ol this year, andn five years. It has traditionally beenpercent Negro. Although it has generally been impartial, the Easttended to look upon itegro-dominated body which cannot beprotect then in emergences. To rectify this racial imbalance theprogram (adopted on the recommendation of the Internationalof Jurists) aims at enrolling three East Indians out of everyBurnham presumably hopes to insure the loyalty of both forcescontrol over their commands.
The Opposition
losing Ihe genera] electionhe PPP has been in adisarray and the country haseriod of relativeis in part due to Burnham's detention of the more extreme PPP leaders, andto his moderate policies toward the East Indian population. ButJagan's party has been beset by the troubles that often accompany apower. It has been torn by disaffection and dissension and splitand strategy. Some important party figures have resigned otherssuspended or fired, and still others have been replaced.
despite serious dissension and continuing criticismPPP and Jagan's Inability to disburse patronage as he could when inis no substantial evidence that the loyalty of the vast majority of thehas been diminished or that jagan's control of tbe partybeen significantly loosened. Jagan continues to be an outspokenand maintains connections with Castro's regime in Cuba and withgovernments. But inside Cuyana this posture has little to do with
hut political standing, there his appeal is thattrong racial leader. Jagan still commands tbe support of most of tho East Indians because they continue to fear and distrust Burnham and tbe Negroes, because tbey prefer to beby one of their Own race, and because they* stall find Jagan more attractive than any other Induo leader.
policy has also been shifting and inconsistent. Up to now.eschewed major violence; such violence as has oceiiiicd has beenmore at property than at individuals. Jagan presumably recalls theof the Negroes in tie disorders of previous years, and be fears thatscant excuse to bear down ruthlessly on tbe PPP. Tbe PPP membershaving originally refused to take their seats, have long sincethe legislature. The evidence to date leaves us uncertain whether Jaganto carry on the opposition by "parliamentary" or byorombination of the two,
II. THE OUTLOOK Political Prospects
Bumham's performance to date, combined with Jagan's current indecislvc-ne.u. has improved the prospectselatively smooth transition toBut the formidable array of social, political, and economic ills that have plagued the country in the past will persist. With the departure of British troops at the end ofbe likelihood of an outbreak of violence will be increased.
Independence will also probably bring the suspicions and hostility between the coalition partners into clearer focus. These might lead D'Aguiar to resign from the cabinet o: burnham to dismiss him. But even in this event, the fear that Jagan could again come to power would probably keep tbe other UFfrom leaving tbe coaliboo D'Aguiar's departure wouldlow toconfidence, but so long as the coalition bo Ids together we do not think that there woulderious effect on the economy.
Although Jagan has notolicy of violence, we do not believe that he has completely ruled out the possibility of doing so eventually. Ina decision he will be Influenced by his estimate of several factors: thebe could muster among tbe East Indiansesort to violence, tbeeffectiveness of the Guyanese security forces (possibly reinforced by theis chances of coming to power peacefully; and the aid he could hope to receive from Communist regimes- He mayore moderate courseimited time, perhaps ending the PPPs sporadic sabotage andore constructive attitude in the legislature He may repeat his offer to enteroalition with Buraharn, on onTer that Burnham would regard with suspicion and would almost certainly spurn. At any rate. Jagan will probably continueuntil be can spot some exploitable vulnerability in the Burnham government. Flare-ups could be sparkedew independent extremists, but without Jagan's
backirg these would amount toore systematic effort, if Jaganone, would probably take the traditional form of widespread disorder and terror rather than an organized guerrilla movement.
Even after the British troops depart ooctober, tbe local security forces will probably be competent to deal with violence on the limited scale experienced since4 elections. However, it is unlikely that they could control aof near anarchy like that in tbe worst days3f violence did get out ot band, Burnham would probably calleturn of British troops. If US consent were forthcoming and British forces were available, we believe that London would comply.
The foregoing suggests tbat Bumham's control of the situation is not likely to be seriously challenged for some months. But in the longer term, hethe fact that tbe East Indians areajority of tbe population and that he must cope with tba implications of this development in8 elections. Thisery tricky problem, and bow Burnham will seek to deal with it is by no means clear. He will certainlyary eye on the Jagins and be alert for an opportunity to detain or exile them, in tbe hope that other East Indian leaders would lack their wide appeal. At the same time, Burnham will continue his efforts to mollify East Indian fears. He will probably continue to subsidize rice crops, but this will be impeded by considerations of cost He may also make it somewhat easier for East Indians to get government jobs.
Burnham will Snd il difficult to win substantial and reliablesupport, he may turn to measures designed to overbalance them inHe bas already suggested encouraging the immigation ofthe West Indies, or joiningederation with some of theislands. If he became convinced tbat these schemes were inadequatetbe growth in the East India- voting population, be would probablypostpone, or to rig.8 elections. Any such attempt to perpetuatein power would alarm the East Indians and increase the chance ofAll riungs considered, tbe pre-election period is likely to be aio Guyana.
Economic Outlook
Economic growth will dependarge degree on Bumham's success in obtaining private and public capital for his government's seven year development plan. He will press ahead with efforts to get it from tbe US. Canada, and the UK. While the climate for foreign investment will probably lemain favorable under Burnham and capital flight is not expected to be serious, financialon the government, both for current and developmental expenditures, will probably grow faster than revenues. Hence. Cuyanese requests for foreign assistance are likely to exceed even the sizable ones already planned
In the short run, the rice industryajor problem to the Burnhamay of life to tbe majority of East Indians, rice is iaenScirntly produced on small family farms and is generally of inferior quality. To insure
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tbe loyalty of Ins East Indian followers, Jagan encouraged tbe increased pro-ductioo of rice. Heew major outlet for it in Castro's Cuba, which was willing to pay cash at prices above the world market These terms have been denied to Burnham, who has accordingly had to sell rice where he could at world prices. Yet he has felt compelled to continue the high payments to the rice growers in order to avoid serious disaffection, as well as the possiblethat could result. Thb subsidizationtrain on tbeand on the relations between Burnham ando diversify agricultural production is an obvious solution, but it is an expensive and long-term one, on which little progress has been made.
long-term future of Cuyana's economy will continue to bo cloudedproblem of employment. Unemployment is estimated atercent offorce. Underemployment is diScuh to quantify, but it isin tbe rural areas. Planned expansion of investment in bauxiteextractive industries will improve the governments revenues andposition but will notarge number of additional jobs.is true of investment to mechanize agriculture.
Foreign Affairs
Burnham will seek loeutral posture on tbe international scene-He may trade with and accept aid from Communist regimes, but he will continue to recognize his country's ultimate dependence on the US, UK, and Canada. Jaganonsiderable amount of help from Cuba in years gone by, but even were be to return to power be would probably now find Castro leu able and Castro's foreign sponsors less willing to provide much assistance, though token aid would probably be fortbec^mng.
Guyana inherits border disputes with Surinam and with Venezuela. The former involves little territory and can almost certainly be amicably resolved. The latter is more troublesome; it involves over half of Cuyana's area and is an emotional political issue in Caracas, which claims that the settlement madeears ago was fraudulent and is hence invalid. Inbe parties agreed to refer the caseoint commission which has four years to reach agreement, failing which the parties ore pledged toolution through the UN. We think tbe matter will be dormant for the nest couple of years, though ft cooH be revived during8 Venezuelan presidential campaign.
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