170. Memorandum of a Conversation, Pentagon, Washington, November 2, 19551
SUBJECT
- Necessity for Maintaining an OSP Program in Norway
PARTICIPANTS
- Mr. Gordon Gray, Assistant Secretary of Defense
- Mr. McGuire, Deputy Assistant Secretary of Defense, ISA/MDAP
- Mr. Leffingwell, Defense
- Dr. Bennett, Defense
- Ambassador L. Corrin Strong, U.S. Ambassador to Norway2
- Marselis C. Parsons, Jr., State, BNA
Ambassador Strong called on Secretary Gray to express his deep interest in the maintenance of existing ammunition and small arms manufacturing facilities in Norway developed under the OSP program. Ambassador Strong pointed out that [less than 1 line of source text not declassified]the Norwegians had constructed a new [less than 1 line of source text not declassified] arms plant in accordance with our desires and that [less than 1 line of source text not declassified] they were manufacturing Bofors guns and other small arms. He said that he feared the contracts which enabled these facilities to employ labor and keep the plants in operation would be completed during the next few months and that in view of the fact that these facilities were substantially expanded because of our interest it was desirable for us to keep the plants functioning. The Ambassador said that only a small amount of money was involved, probably not amounting to more than $3 million.
Secretary Gray replied that the Defense Department fully understood the desirability of maintaining these facilities but that current appropriations provided only one-tenth the amount for OSP that was available as recently as two years ago which made it necessary drastically to cut allocations for this purpose. Secretary Gray instructed Dr. Bennett to investigate the possibility of using the equivalent of $1.8 million (approximately 25 million kroner) generated by Section 550 Sales of Surplus Commodities to Norway for the purpose of OSP with a view to the consumption of end items in Norway or in third countries.
Ambassador Strong pointed out that in some European countries it was possible that similar products might be produced in plants receiving government subsidies and he asked Secretary Gray to bear this in mind when considering prices quoted by these two Norwegian facilities.
Ambassador Strong voiced his apprehension of the effect upon public opinion in Norway if we failed to provide work for the plants which had been constructed as the result of our desires. He pointed out the great pressure now being exerted by Russia on Norway to withdraw from or at least refrain from active participation in NATO.
In connection with the spare parts program Ambassador Strong pointed out that it was impossible to expect Norway to shoulder the full cost of replacement for matériel. He estimated that the necessity for U.S. assistance in this field would amount to at least $15 million. He pointed out that this matter would be more clearly developed in the USEA study now in preparation.