The Acting Secretary of State to the Embassy in the United Kingdom1
3172. Fol consultations here with Min Villard on Libyan request for increased compensation in return for base agreement, Defense now amenable to providing some additional econ aid.2 Defense obviously wishes obtain ratification for cheapest price possible.
Tripoli has not yet been informed of this Defense attitude and it will not be communicated to Libyan Govt until Min Villard’s return later this month. Dept is meanwhile discussing with him in what form and under what conditions offer shld be made.
Important consideration is Brit attitude towards any new arrangement. As reported Tripoli’s 299 (30 to London),3 Libyans now appear [Page 558]interested in using US aid to assist in establishing new econ org, perhaps loan agency for agricultural or gen econ development or perhaps settlement project. Gen opinion here is that we shld attach some conditions to increase to insure that it is well spent. Since Libyans do not want increase to go into Development Agency and appear attach great importance to use of US aid to offset Brit influence, obvious suggestion of assigning aid to Development and Stabilization Agency appears eliminated and we are confronted with delicate problem of how else it can be used.
Further problem is to insure that this is definitely last round in negotiating compensation for base agreement. In this we wld like to enlist whatever influence UK or Brit advisers can exert on Libyan Govt to secure prompt ratification without further demands for econ assistance.
So that he may discuss these questions with FonOff and obtain Brit views before he approaches Libyan Govt, Min Villard is returning Tripoli via London, sailing Nov. 15 on United States which arrives Southampton Nov 20. Suggest Emb meanwhile indicate nature of problem to FonOff so that it will be prepared with opinion upon Min Villard’s arrival.
Defense willing further grant be made on understanding that it will insure ratification base agreement earliest possible moment. Consequently Min will have to negot terms any increase immed upon his return to Tripoli.
- This telegram was drafted by Root (AF) and cleared by Utter (AF).↩
- On Oct. 31 an Air Force official informed the Department of State that Defense could increase funds to Libya by $1 million, with the maximum to be not more than $2 million per year for 20 years, although they hoped every effort would be made to obtain the agreement for less. (Memorandum of telephone conversation of Oct. 31; 711.56373/10–3152) A letter from the Secretary of Defense, dated Nov. 22, confirmed the agreement in writing, stating that the Department of Defense had discussed the necessity for the additional amount with representatives of the appropriate Congressional committees. Defense hoped, however, that arrangements could be made later to permit the annual payments to be made from a nonmilitary source. Attached to the letter was a copy of a proposed technical schedule which included all of the known U.S. military requirements in Libya. (711.56373/11–2252)↩
- Not printed, but see