Expropriation

In ten typewritten pages, the Guatemalan government's land-reform administration last week told the U.S.-owned United Fruit Co. that the government will expropriate 225,000 acres of the company's 300,000-acre plantations at Tiquisate (TIME, March 2). Included in the bite: 125,000 acres of woods and brush, 87,000 acres leased to others for cattle and crops, and 12,000 acres lent by the company to its workers to grow corn and beans.

United Fruit appealed to President Jacobo Arbenz to stay or reverse the seizure, but this week Arbenz rejected the appeal.

Company lands now planted in bananas, African oil palms and other crops, as well as dairy pastures, planted mahogany forests and building sites, are exempt from expropriation. Thus the drastic seizure will not immediately end United Fruit's Guatemala operation. But eventually, as the inevitable "Panama disease" (a fungus that attacks the roots) sickens the banana lands, the company, deprived of its reserve tracts, will have to cut production. And United Fruit is on notice that further investment in Guatemala would be unwelcome--and unwise.

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