Expropriation and consequence: Peru-United States relations (1963–1975)

Abstract

This article studies the nature of Peru-United States relations during the period 1963–1975 through an analysis of the dispute over the potential expropriation of the US-owned International Petroleum Company. The United States government implemented a tough policy towards the first government of Fernando Belaúnde – who sough a “special” relation with the Unites States –characterized by the threat of economic sanctions if the Peruvian government did not solve the issue in favor of the company. The threat of the Hickenlooper Amendment, which sought to penalize countries that expropriated American owned businesses, was a clear sign of this. Once the company was expropriated by the Revolutionary Government of the Armed Forces in 1968 the American government was ironically forced to follow a more flexible approach, as the new military regime sought to diversify its bilateral relations in the bipolar context of the Cold War. The American policy of supporting the IPC had negative long-term effects fo American interests in the region, as it accelerated the overthrown of Belaúnde and ushered in the arrival of a military junta which sought a more independent foreign policy. A country that had been solid American ally camp since the end of World War II had become a nonaligned nation.