441. Memorandum From the Executive Secretary of the Department of State (Eliot) to the President’s Assistant for National Security Affairs (Kissinger)1

SUBJECT

  • OEP Request for Exception to Prohibition on Sales of Excess Tin from the National Stockpile

On February 18, General Lincoln requested that a one-time exception be made from the President’s directive of April 9, 1971, which suspended indefinitely commercial sales of stockpile tin.2 The Department of State opposes the lifting of the ban on tin disposals at this time. The foreign policy reasons which caused the Department to recommend previously that no commercial sales of stockpile tin be made still obtain. Although the leftist regime of Bolivia’s former President General Torres [Page 1083]has been replaced by a friendly government, serious political instability, critical monetary and fiscal problems, and high unemployment continue to exist in that country. Stockpile tin sales have not diminished as an emotional issue in the Bolivian political arena, and the precarious tenure of the Banzer Government would be threatened. As you informed the Department on February 2, the President wants a forthcoming assistance program for Bolivia.3 Continued suspension of stockpile sales is an integral part of our cooperative policy toward Bolivia.

The impact of a tin sale to a U.S. Steel subsidiary would have a particular impact on Malaysia since U.S. Steel generally buys Straits Tin. The Malaysians and other Southeast Asian producers would view the release of two thousand tons as damaging to their developing economies and as a prelude to future releases. The United States is committed to consultations with the producer governments and the International Tin Council before the commercial release of tin from the stockpile, and given the certainty of public knowledge of those consultations, the US would be faced with strong diplomatic protests even before the sales were made.

A further foreign policy consideration is the likelihood of strong criticism of the US disposal programs at the upcoming UNCTAD-III Conference in Santiago. If we begin consulting with the tin producing countries now, we can expect adverse reactions at UNCTAD-III in April.4

Although a one-time exception to the President’s directive might be justified on economic grounds, particularly since it involves a barter transaction, I believe that the ban should not be lifted now for the above foreign policy reasons.

R.T. Curran 5
  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 267, Office of Emergency Preparedness, Volume III 1972-1973. Confidential. Attached to Document 442.
  2. See Document 440 and footnote 2 thereto.
  3. Not further identified.
  4. For documentation on UNCTAD III, see Documents 144 ff.
  5. Robert T. Curran signed for Eliot above Eliot’s typed signature.