347. Memorandum of Conversation0
SUBJECT
- COCOM List Review
PARTICIPANTS
- The Viscount Hood, Chargé d’Affaires ad Interim, British Embassy
- The Under Secretary
- Mr. Harold A. Levin, Director, USRO/ST, Paris
- Mr. L.O. Sanderhoff, Office of European Regional Affairs
- Mr. Robert B. Wright, Chief, Economic Defense Division
The Under Secretary referred to the British proposals for COCOM which had been transmitted to the Department on September 8th.1 He said that the proposals were described as being the product of the official working level within the British Government, not as yet reviewed or approved by British Ministers. He said that of course the United States had not made a detailed technical analysis of the British proposals, but did have some initial views.
The Under Secretary said that the cumulative effect of the British proposals was so extensive as not to be in accord with the spirit of the general understanding which prevailed at the time of the 1958 Consultative Group meeting to the effect that the annual list review would involve only minor adjustments in the international lists necessitated by significant changes in technology or Soviet bloc utilization during the year. He said that the prevailing view had clearly been that the 1958 list review represented a major revision and reshaping of the international control system for a long-term period, at least several years. The previous general list review had taken place in 1954 and it was the view of the participating governments that the 1958 review would remove the necessity for any major revision of the lists for approximately a similar period of time. He said that of course it was understood that any participating country might make a special proposal on a particular item at any time as, for example, the UK had done with respect to rolling mills.
The British proposed changes, contrary to the view that the 1959 review should be a minor overhaul operation, would affect half of the present embargo list. The list contains 120 items at present and the British proposals would contemplate removing 26 items plus an additional six sub-items, would propose redefinitions for an additional 12 items, and might involve some potential changes in an additional 16 items which are still under study within the British Government. Changes of this magnitude would necessitate a major negotiation in COCOM on the scale which was necessary last year, especially when the suggested changes of other participating governments were added to the changes suggested by the British. One of the most disappointing aspects of the British proposals was the fact that they proposed the deletion of all the items which had been the subject of special compromise efforts in 1958. This honestly seemed to us not to be in the real spirit of the 1958 agreement. The Under Secretary said he hoped the British Ministers would consider this U.S. reaction most seriously.
He said that the British proposals left us in a difficult situation. A major negotiation would require the assignment of large numbers of technicians and lengthy discussions in COCOM which would unquestionably [Page 773] extend for many months. This negotiating process could not possibly be completed within the schedule set by the Consultative Group. Instead of a January 1 effective date for the revised lists, a June 30 date would be more realistic. Apart from the extended time involved for such negotiation, the worst part of the situation is that it would inevitably involve a sharp and unedifying debate between the United States and the United Kingdom in the multilateral forum before the other participating governments. Such an exhibition could not help but be damaging to the interest of both the United States and the United Kingdom in maintaining a cooperative atmosphere within the COCOM and NATO community. Any such flare-up of basic differences on East-West trade control questions would be particularly unfortunate at this time since such good progress has been made in recent months in resolving the various economic problems which have troubled US–UK relations.
The Under Secretary said that he felt there might be a better way out of the difficult situation which we would face if the British proposals were tabled as they stand in COCOM, and that he wished to outline his views on this matter for consideration by the British Ministers when they go over the UK official-level proposals. He said that it might be possible for the British to select a few items which were of special importance to them either for trade reasons or for political reasons or because of other considerations of urgency, and propose changes on those items in the forthcoming annual list review. If the British were to select six or eight or, at most, ten of such items for discussion in COCOM, this would represent a manageable task for the Committee and would be quite acceptable to the United States in terms of a feasible working program. The remaining items in the British proposals could then be made the subject of bilateral technical discussions between the United States and the United Kingdom, beginning at such time as the 1959 annual COCOM review has been completed. The purpose of such bilateral US–UK discussions should be to discover whether a substantial agreement might be reached between the two countries on the remaining British proposals. If such agreement could be reached, the United States would then have no objection to British submission of such proposals to COCOM at any time following the 1959 list review or at the latest at the time of the 1960 list review. This arrangement would have the advantage of permitting the British to deal with a few items which are of importance to them and on which changes might be justified in COCOM and would be in accordance with the prevailing concept of a limited annual list review. In addition, it would remove the danger of an unrewarding semi-public debate between the United States and the United Kingdom and would permit an orderly bilateral examination of the British [Page 774] proposals on their merits. As a practical matter, the British would not really lose any time as compared with a major review which would extend well into next year in any event.
Lord Hood said that he was not familiar with the details of the items dealt with in the British proposals but inquired whether the Under Secretary had in mind that the British might make the selection of items for discussion in COCOM in the 1959 review themselves or whether he had in mind that such selections would be a joint matter with the United States. The Under Secretary said that he had in mind that the British would make the selection themselves taking account of their own special interests. Lord Hood said that he had little idea of what items might be of special importance, but he did recall that he had heard considerable reference made to the importance of aircraft. Mr. Dillon noted that the British proposal with respect to aircraft did not appear to be a troublesome one to deal with in the COCOM discussions. He said the British proposal was essentially for a clarification and extension of embargo coverage for aircraft engines to bring this treatment into conformity with the treatment of aircraft themselves, and seemed to be an appropriate suggestion. He noted also that the British had made proposals for the liberalization of certain instrument systems and navigation radar systems for aircraft to make such equipment freely available for export to the Soviet bloc for use on scheduled services to the free world. Mr. Dillon said that this might be another point of special interest to the British. It was a liberalization somewhat beyond our present policy on such sales but might be a reasonable question to re-examine.
The Under Secretary said that while there might be some items such as those which had been mentioned which were of significance to the British and which might profitably be re-examined, he felt that there certainly appeared to be many items in the British list to which the British themselves might wish to give some careful second thoughts. For example, he said that the proposal to delete fishing vessels designed for speeds of 17 knots and over was a type of proposal which seemed to be highly doubtful. It was clear that nobody would build a fishing vessel of that speed unless it was actually intended for naval applications. While the United Kingdom and the United States might not wish to build or sell such vessels to the bloc, the removal of the item from the international list would make it possible for other COCOM countries to take advantage of such trade, and the Japanese, for example, might be most interested in building substantial quantities of fishing vessels for sale to the Communist Chinese where they would in fact constitute a significant military potential item.
[Page 775]The British Chargé said that he would report the U.S. reactions and proposal to London for consideration there and indicated that he saw some merit to the proposal which Mr. Dillon had outlined.