200. Action Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon 1

SUBJECT

  • Tariff Preferences for Less Developed Countries

Attached at Tab A is a memorandum from Secretary Rogers 2 recommending that: [Page 520]

1)
The US submit, to the OECD Working Group on Preferences, several illustrative lists of items to which generalized tariff preferences from the United States to the less developed countries might apply if such a scheme were adopted globally.3
2)
State be authorized to initiate consultations on the preferences issues with key Congressmen. Both steps would be undertaken with the clear understanding that the US has made no final decision on whether to participate in a preference scheme.

The US is the only major country not to have submitted its illustrative product lists to the Working Group, which is studying the variety of complex issues which would be involved in any preference scheme. We held off pending our review of over-all US trade and aid policies, now completed. As a result, a number of LDCs have complained about our slowing down the work program. It will still take a week or two to prepare the lists, but a decision now to proceed would enable us to maximize the political payoff by announcing our decision at UNCTAD beginning on April 28. (Paul McCracken disagrees. He argues at Tab B that we should go ahead with interagency preparation of the lists, but believes we should make no official announcement because the LDCs would take it as a statement of US intention to work for a preference scheme.)4

You have indicated that you want to see the results of the study directed by NSSM 485 before deciding whether the US should support a preference system but that you wish the work on it to proceed urgently. Submission of our lists and initiation of Congressional consultations are necessary prerequisites to a final judgment. There is some risk, as McCracken says, that our submission of lists will imply a commitment to ultimately proceed with a scheme and increase the political repercussions if we eventually back away, but the submission of multiple lists instead of a single list and a clear statement that we have not yet made up our minds should keep the record straight.

Recommendation:

That you approve Secretary Rogers’ proposals.6

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 404, Trade: Preferences for LDCs. No classification marking. The memorandum is attached to an April 22 memorandum from Bergsten recommending that Kissinger send it to the President, and a stamped notation at the top of the page reads: “The President has seen.”
  2. Rogers’ April 19 memorandum is not printed.
  3. In the attached memorandum, Rogers explained that in 1968 the OECD had established an ad hoc Working Group to study the issues related to preferences, and that the Working Group had agreed that all potential donors would table illustrative lists of products which might be covered or excluded from a preference scheme.
  4. McCracken’s April 24 memorandum is not printed.
  5. Document 198.
  6. The President initialed his approval. Below his initials is the handwritten note: “State Secretariat has been notified per Houdek 4/2969.”