The Reagan administration yesterday voted for a $35.7 million loan to Chile from the Inter-American Development Bank despite calls from congressional liberals that the United States oppose the loan to protest the Chilean military government's mass arrests of more than 7,000 people in the past two weeks.
However, U.S. officials said the administration has not decided whether it will support another pending IADB loan to Chile of $125 million that is scheduled for a vote Monday. The officials said the administration's decision will be "influenced heavily" by events in Chile in the next few days.
A senior State Department official, who asked not to be identified, said last night that yesterday's vote was "made on the basis of the economic benefits that it will provide to the people of Chile and does not reflect U.S. indifference to what is going on in Chile."
"We are still deeply concerned by the internal Chilean situation and have communicated this view to both the government and the opposition there," the official added. "We cannot say at this point what position we will take when the next loan vote is taken, but it will depend, at least in part, on what happens there in the next week."
The situation could signal a new outbreak of a controversy that has gone on intermittently since 1981 when the Reagan administration abandoned President Jimmy Carter's policy of opposing, for human rights reasons, all so-called "nonbasic human needs loans" to Chile by multilateral lending institutions.
The move was part of the new U.S. administration's campaign to improve relations with the government of Chilean President Augusto Pinochet. The administration said it would consider loans to Chile on a case-by-case basis, taking into account their economic merit as well as human rights considerations. The practical effect has been U.S. support for all Chilean loan requests since 1981.
Recently, however, U.S.-Chilean relations have been strained severely by the Pinochet government's declaration of a state of siege and its subsequent campaign of mass arrests and intimidation against its opponents. These moves have been criticized publicly by Secretary of State George P. Shultz, and the State Department has made several calls for the Chilean government to engage its political opposition in a dialogue leading to restoration of democracy.
The situation also prompted several members of Congress to call on the administration to underscore its protests by voting against or abstaining when the loans were considered by the IADB.
Voting by the bank's ruling general committee is weighted according to the contributions made by different countries to the bank's funds. As the largest contributor, the United States has 35 percent of the voting rights on such loans, with the rest distributed among 42 other countries.
Despite the congressional appeals, the U.S. representative to the bank, Jose Monroe Casanova, was directed to vote in favor of yesterday's decision to approve a $35.7 million loan for improvement of roads in southern Chile.
A second loan request that would provide $125 million for municipal improvements in Chile had been scheduled for a vote last Monday. But at the request of Japan's IADB representative, the vote was postponed one week.
Officials at the State Department and the Treasury Department said the decision to vote for the road-building loan was motivated both by a feeling that its economic effects are potentially of great benefit to the Chilean people and by uncertainty about whether punitive U.S. action at this time would help improve the human rights situation in Chile.
Some officials said the U.S. ambassador in Santiago, James D. Theberge, has argued strongly that attempts to ban aid would be counterproductive to efforts to moderate Pinochet's course.