The administration's campaign against Cuban influence in the Caribbean has been dealt a rebuff by regional governments that are refusing to accept a U.S. proposal that would bar the tiny, Cuban-allied island of Grenada from receiving American financial aid disbursed through the Caribbean Development Bank.
In a secret vote late last week, those English-speaking island republics belonging to the Barbados-based regional development bank spurned an intense U.S. lobbying effort and unanimously rejected Washington's attempt to specify that Grenada not be among those eastern Caribbean ministates sharing in a proposed $4 million U.S. grant for "basic human needs" projects.
The vote was potentially far more significant than the amount of money involved, because it indicated resistance among Caribbean nations to U.S. efforts to draw ideological distinctions in the area and to use foreign aid as a weapon for rewarding pro-western governments while punishing those that the administration sees as adversaries.
U.S. officials took refuge yesterday in the fact that Washington has not yet been notified officially of the bank's decision and said that, as a result, they could not say yet how the administration will react. To allow the grant to go through on a no-strings basis would thwart U.S. hopes of putting pressure on Grenada, but withdrawing the proffered $4 million would deprive other potential recipients of its benefits and create resentment toward the United States.
That, in turn, could cause problems for the administration's evolving Caribbean basin policy -- an ambitious plan to combat communist influence in Central America and the Caribbean through increased economic and military assistance supplied by the United States and other major western industrial nations.
Underlying the policy is the administration's desire to show that it is not locked into a one-track military approach to such regional problems as the civil war in El Salvador, and instead is capable of a broader focus that will address not only U.S. security concerns but also such Third World concerns as trade and development.
However, many of the potentially involved countries suspect that the policy is, at its root, an elaborate scheme for containing Cuban and Soviet activities and, as such, is likely to increase Cold War tensions in the Caribbean. During his recent visit here, for example, Mexican President Jose Lopez Portillo reportedly argued strongly that such a program cannot exclude regional countries such as Nicaragua and Grenada, even though the administration regards them as under Cuban influence.
According to reliable sources, a similar feeling that the United States was trying to inject political considerations into the decisions of an organization that is supposed to be apolitical in dispensing loans accounted for the rejection of the U.S. position in the Caribbean Development Bank. fAlthough the United States is not a member, it channels much of its aid to the eastern Caribbean through the bank.
U.S. relations with Grenada have been strained since two years ago when radical young leftists seized power in a coup and espoused policies that have been openly pro-Cuban and anti-American. Earlier this year, the United States irritated some members of the European Economic Community by trying to intercede with it to reject Grenada's pending request for financial help with a new airport being built with Cuban assistance.
In dealing with the bank's member states, the United States took the position that it had the right to choose which countries should be recipients of the grant. However, while it argued that it was earmarking the recipients to ensure that the money went where it was most needed, the bank members are understood to have considered the U.S. position as an ill-disguised move against Grenada.