786A.5 MSP/9–1952

No. 1443
Memorandum of Conversation, by Robert Sturgill of the Office of Near Eastern Affairs

top secret

Subject:

  • Grant Aid for Saudi Arabia

Participants:

  • Mr. Raymond A. Hare, Ambassador to Saudi Arabia
  • S/MSA—Mr. Martin Mr. Bryan
  • NEA—Mr. Daspit
  • NE—Mr. Sturgill

Summary:

Mr. Martin referred to developments regarding the Air Force base in Libya as . . . . It seemed to him, he said, that SA had plenty of money of its own and there was no ME defense program, so what reason was there to give SA grant aid?

Ambassador Hare replied by describing briefly some of the history relating to the signing of the Dhahran Airfield Agreement on June 18, 1950 [1951]. The cash-reimbursable military assistance agreement signed on the same date had been offered as a quid pro quo for DAF. The US had given the SAG nothing else, except a limited training program under the DAF Agreement. However, with authorization from Defense and State, he and General Day had discussed with the SAG the special position of SA vis-à-vis the US and the possibility of some grant aid becoming available in the form of 10% of the funds earmarked for Greece and Turkey. For a [Page 2423]long time following conclusion of the DAF negotiations, the SAG had remained silent, but then they began making inquiries about grant aid. The newest inquiry had come during the recent MAAG negotiations. The situation could be summarized as follows, said Ambassador Hare: The US has an “implied commitment” to give grant aid to SA. The SAG is now proceeding with implementation of the cash-reimbursable program. The Air Force now wants additional rights at DAF, and the success of negotiations for these rights is not foreseeable without grant aid. JCS documents indicate the special position of SA in US military planning. . . .

Expressing the view that he had always thought of grant aid as being a reward for participation in MEDO, Mr. Martin asked whether the US would lose Saudi participation, if SA were given grant aid in advance. The Ambassador said no, and Mr. Daspit remarked that SA, in making DAF available to the US, was far ahead other ME countries when it came to such lines of cooperation.

Mr. Martin asked what amount of grant aid for SA the Ambassador was thinking of in this discussion and what items it would be applied to. Originally, the Ambassador replied, he had been thinking in terms of about $10 million; but now he was thinking of about $5 million. As to which items the money would be applied to, he didn’t know. This was something for discussion, and he asked whether grant aid funds could be used for purposes of construction. Mr. Martin didn’t think they could be.

Mr. Bryan was curious to know whether SA could absorb this amount of equipment under present training conditions or whether giving SA grant aid would merely be a political gesture? The Ambassador replied that it was both; and Mr. Daspit referred to the US training mission already in SA and said SA, therefore, would be able to use the equipment later if not now. Mr. Martin inquired whether the grant aid would be used for the present Saudi military program and whether it would be spent on the ground or air portion? The Ambassador thought it would be used for both but probably for the air portion first. Was any jet air force envisioned? Mr. Martin asked. He remarked that SA was the only country he knew of which could afford jets. The Ambassador pointed out in response that Saudi Arabia’s financial condition now was good but that the country really had nothing, relatively, by way of modern development, still having a long, long way to go to catch up with some of the other ME countries.

If fiscal 1953 funds were used for grant aid, how long would it take to develop a program for SA and what would we have to give next year if we gave $5 million this year? Mr. Martin asked. Mr. Daspit pointed out that grant aid was visualized as supplementing [Page 2424]but not adding to what SA was already getting under the cash-reimbursable program. The Ambassador said he and General Day had talked to the SAG only in terms of existing legislation; however, it was well to note that under terms of the DAF Agreement the US was committed to provide training to SA for five years. Mr. Martin then inquired whether $5 million a year for five years would accomplish what the US wanted to accomplish, and the Ambassador said the US would have to keep looking over its shoulder at that one. Mr. Martin wanted to know whether that meant that the US would have to give more to SA than to other ME countries, if the others participated in MEDO? The Ambassador replied that the SA position would change, depending upon the quantity of participation of the other states.

Mr. Bryan described what he thought was a weak spot in the Defense letter endorsing grant aid for SA.1 He said the Air Force appeared to be behind grant aid, but apparently they were unable to swing a positive Defense interpretation of their position. The Ambassador alluded to his recent discussions with Defense officials and said their oral interpretation was positive.

Pointing out the difficulties in other countries in obtaining a 511(a. agreement, Mr. Martin inquired whether there was any possibility of negotiating such an agreement with the SAG. The Ambassador replied there probably was a possibility; it would be difficult, but he was willing to undertake such negotiations. Mr. Martin asked whether the SAG thought the US was reneging on grant aid, even though an area program had not been started. (He was referring to discussions during negotiations for the DAF Agreement in May of 1951, when the Ambassador and General Day had talked to the Saudis to some extent of grant aid in terms of an area program.) The Ambassador replied that the emphasis during the discussions had been on the possibilities of Congress passing the necessary legislation, not on an area program.

The Defense letter, Mr. Martin then observed, had weaknesses. Mr. Daspit interrupted and asked whether Mr. Martin felt the Department should not go ahead with its intended request for a Presidential finding? Mr. Bryan added the thought that perhaps the Department should go back to Defense for a more favorable endorsement; and Mr. Daspit, expressing tentative agreement, said the movement within the JCS for a program for the NE had been more favorable during the past two months, and perhaps the Department should talk to Admiral Smith. Mr. Martin said the squeeze for money was very tight this year (fiscal 1953), and the Department [Page 2425]would have to have a very strong case to take to DMS; so it would be better to go back to Admiral Smith.

The Ambassador inquired whether it would be possible to push ahead anyway, even if it weren’t possible to get a more positive endorsement from Defense? Mr. Martin said he thought so but that the Department should try first to get something further from Defense. Mr. Daspit and Mr. Bryan agreed to approach Admiral Smith on the matter.

  1. This reference is to the letter from the Secretary of Defense, Document 1438.