786A.5–MAP/11–2150: Telegram
The Secretary of State to the Embassy in Saudi Arabia
180. Emb will be advised date notification to Cong Comites of designation SA as eligible cash reimbursable mil assistance, re Deptel [Page 1195] 171, Nov 15.1 Emb shld simultaneously notify SAG. Emb also authorized as of that date institute negots extension this aid.2
FYI fol is substance of note which shld be submitted SAG at appropriate time setting forth minimum requirements for extension assistance.
“Re request of Govt SA for trans of certain items of mil supplies and equipment, there are certain assurances and understandings which US Govt is required obtain from ur Govt before completing any transaction under section 408(e) of Mutual Defense Assistance Act of 1949 (Public Law 329, 81st Congress) as amended by Public Law 621, 81st Congress.
“I understand ur Govt is prepared to agree to use such items as may be provided to foster internatl peace and security within framework of Charter of UN”; and moreover, that the items to be provided by US Govt are required by SAG to maintain its internal security, its legitimate self-defense or permit it to participate in the defense of the area of which it is a part, and that it will not undertake any act of aggression against any other state.
“I understand also that your Government will obtain the consent of the Govt of the US prior to the trans of title to or possession of any equipment, materials, info, or services furnished, and that ur Govt will take measures to protect the security of any article, service, or info furnished.
“In order pay for mil assistance, SAG will open an irrevocable ltr of credit in favor of SecState in US bank for full cost including accessorial and administrative expenses incident thereto of each order equipment to be purchased when order made. Drafts on this ltr payable Treasurer of US will be drawn before equipment out of USG stock is transferred to SAG. Re equipment for which orders must be placed with manufacturers, contracts will be placed in behalf SAG by agency USG. Payment for such equipment must therefore be arranged in advance in same manner outlined above including such amounts as may be required to defray progress payments on contract and plus the estimated cost of damages resulting from possible cancellation of contract by the SAG. Increments necessary cover possible damages will be applied toward final payment under contract. Any remaining funds will be returned SAG.
“The Govt of SA will also understand that the Govt of US necessarily retains the privilege of diverting items of equipment or of not [Page 1196] completing services undertaken, if such action is dictated by considerations of national interest.
“A reply by the Govt of SA to the effect that these understandings are correct will be considered as constituting an agreement between our two Govts.”
Dept aware payment scheme undoubtedly unpalatable SAG, but law stringent re this point and above payment scheme least burdensome legally possible. Might be helpful cite recent example advance SAG payments to UK for arms.
- Not printed; it informed the Embassy that the final instructions on military assistance were being prepared, and promised to consider the Embassy’s suggestion on lending equipment to Saudi Arabia (786A.5–MAP/11–1550). Further information on cash reimbursable military assistance is in the editorial note, p. 1182.↩
- Telegram 188, November 29, from Washington, not printed, authorized the Ambassador to begin negotiations with the Saudi Arabian Government on cash reimbursable military assistance. Negotiations for military aid were to be carried on simultaneously with negotiations for the new Dhahran Airfield Agreement. (786A.5–MAP/11–2950)↩