28. Telegram From the Department of State to the Embassies in Turkey, the United Kingdom, Pakistan, and Iran1

178786. Subject: USUK Talks on CENTO.

1.
Summary: US/UK discussions on CENTO revealed close similarity of views. Both agreed should continue present support of CENTO even though CENTO has only limited value. UK hopes continue present level CENTO economic support but urges US increase its declining (due completion capital projects) CENTO financial support either via increased CENTO labelling or as actual increase. US noted (a) relatively high level of US aid if both bilateral assistance and CENTO assistance considered; (b) lack evidence Regionals want increased CENTO labelling and (c) failure Regionals suggest capital projects which meet our criteria. UK proposed creation CENTO Multilateral Industrial Fund to assist in industrial development. We agreed consider carefully. Both agreed we should not approach RCD but should be prepared consider RCD request for assistance. Since Pakistani intentions re CENTO uncertain now, both agreed take look later. If Pakistan opts out, UK supports idea of truncated CENTO primarily because UK has no other treaty arrangement with Iran. We reserved our position stating that we would wish consider all options at time. (End Summary)
2.
Talks with UK on CENTO held Washington October 27. British side consisted of Minister Millard, First Secretary Melhuish and Overseas Development Authority representative McKenzie-Johnson. US represented by DepAsstSec Van Hollen, Schiff, Helseth and Wampler (AID).2
3.
UK stated its review stimulated by very gloomy report on CENTO submitted early 1970 by former UK Ambassador in Ankara Allen, who inter alia suggested converting CENTO into ANZUS-type organization without permanent staff. On basis FCO review, UK however had concluded that CENTO: (a) puts USSR on notice against adventures in ME; (b) provides framework for UK alliance with Iran (which UK values) and amongst three Regionals; (c) gives Shah entree into Western councils; and (d) serves useful function in coordinating [Page 96]Regionals’ interests. UK believes economic program is of most importance and is, in fact key to CENTO’s future. Demise of CENTOwould be to disadvantage of West, especially in view UK withdrawal from Persian Gulf and USSR expansion there. UK had considered its role in CENTO in this light. Various possibilities had been examined including possible shift to observer status; however, UK has decided its main interest is “to soldier on” and continue its current role.
4.
US stated our reviews of 1969 and 1970 had raised essentially same questions and had reached same conclusion: CENTO, even if only of limited value, serves useful purpose at small cost. We therefore intend stay on course and gratified UK anticipates no diminution its role.
5.
UK hopes maintain its role at roughly present level including economic assistance of about $2.4 million per year. UK believes CENTO could be plausible cover for increased naval presence in Persian Gulf (visits and joint maneuvers, not a semi-permanent presence) but care must be exercised not to make Shah think we expanding CENTO military activity. UK noted no decision yet taken so that it remains an option dependent upon number of events, especially stability in Gulf. We said our views not yet crystallized, and we would give UK considered reaction.
6.
Brits urged US provide more aid through CENTO either via increased CENTO labelling or as actual increase. Brits argued capital projects spending nearing end, and US support of CENTO would register drop to one half million dollars annually. Brits urged we seek maintain our total CENTO support at roughly $5 million annually. Discussion revealed Brits prompted mainly by internal UK presentation problems with some within HMG contrasting British CENTO contribution of about $2.4 million unfavorably with US contribution of about one-half million. We gave no ground on this suggestion. We noted a) no felt need or desire on part Regionals for increased CENTO labelling; b) US had indicated willingness consider support for projects meeting our criteria but Regionals have not presented additional projects for consideration in recent years; and c) US FY 70 aid of all types to CENTO countries totals over $300 million even if only one-half million dollars slugged “CENTO.” Of this, $11.7 million is Technical Assistance to CENTO countries.
7.
UK floated suggestion for establishment of a CENTO Multilateral Industrial Fund (CMIF) with an initial capital of $250,000 to be contributed by members on basis CENTO cost sharing formula and to be replenished on an as needed basis. Objective would be further development of industrial projects having multinational value, training of industrial managers and provision of consultants. Might also undertake feasibility studies for those projects which meet criteria. Brits pointed out this idea, which not yet cleared with their own Treasury [Page 97]people, might be useful in heading off regional proposals of more grandiose nature. They are openminded on terms of reference for fund. Brits suggested US and UK might make joint proposal to January Economic Experts meeting, but agreed prior report from Industrial Development Advisor might be helpful in reaching decision. We agreed study proposal and consider carefully both substance of idea and timing of unveiling to others, if we come out affirmatively.
8.
Both we and Brits agreed Secretariat could be made more effective and efficient but also agreed inadvisable to push for major changes now. Brits stated no intention reduce their current level of personnel assigned to CENTO. We noted it might be desirable to take hard look at structure of organization, possibly next year, if Pakistan continues its membership.
9.
UK proposed switch of Special Assistant and DSYG/Economic positions between US and UK in 1971. We undertook to give them prompt reaction since they need to know soon for assignment purposes.
10.
Brits presentation on relationship CENTO and RCD closely corresponded our own views. Consensus was that we should not approach RCD now but should be prepared consider request for assistance by RCD. UK indicated that RCD had approached Hungarians and UNIDO for assistance. We asked for more information re reported approach to Hungary, of which we unaware. We noted question Pakistan remaining in CENTO highly uncertain and suggested we take further look after formation new Pakistani Government. We expressed hope that recent US decision on one-time military sale to Pakistan would help encourage Pakistan to take more positive attitude toward CENTO as well as strengthen regional ties by slowing Pakistani drift toward Chicoms. Brits agreed complete reassessment CENTO necessary if Pakistan opts out. Partly because only formal tie UK has with Iran is via CENTO, Brits urged that CENTO be maintained even without Pakistan; but stated UK might then have to reduce its economic aid to CENTO. If any Regional withdrew from CENTO, UK believes that rapid action including public statement on part remaining members necessary in effort limit danger. UK apparently has in mind example of 1958 London declaration.3
12.
We stated US bilateral agreement with Regionals would not automatically expire with CENTO demise. We also expressed belief [Page 98]Turkey and Iran unlikely withdraw from CENTO in foreseeable future. We not sure Pakistanis prepared make final decision by next Ministerial meeting and suggested UK and US keep in close touch and possibly confer with Turkey and Iran, when new Pakistani Government expresses its intentions toward CENTO. In response specific questions, US stated could foresee continuation of some type truncated CENTO in event Pakistan opts out, but that we would wish take careful look at that time and study all options.
13.
Would appreciate addressee comments, especially on British proposals paras 6, 7 and 9.4
14.
Addressees should not discuss with regional representatives.
Irwin
  1. Source: National Archives, RG 59, Central Files 1970–73, DEF 4 CENTO. Confidential. Drafted by William A. Helseth (NEA/RA) on October 29; cleared in NEA/RA, AID/NESA, NEA/IRN, NEA/PAF, NEA/TUR, and EUR/BMI; and approved by Van Hollen.
  2. Stanley D. Schiff, Director of Regional Affairs, NEA; William A. Helseth, Multilateral Organizations Adviser, Directorate of Regional Affairs, NEA; and Mary Wampler, AID.
  3. Reference is to the communiqué issued July 28, 1958, after the Baghdad Pact Ministerial meeting in London, which welcomed the U.S. agreement to cooperate with member states (Iran, Pakistan, Turkey, United Kingdom) for their security and defense. The Foreign Ministers agreed to maintain collective security and to strengthen their ability to resist direct or indirect aggression and to strengthen their united defense posture. The meeting followed a coup in member state Iraq and the deployment of U.S. troops to Lebanon.
  4. The Embassy in Ankara responded in telegram 7348, November 20, that the United States should not wait for a Pakistani withdrawal but explore a transformation of CENTO, although not a truncated version. (National Archives, RG 59, Central Files 1970–73, DEF 4 CENTO) The Embassy in London responded in telegram 9452, November 16, noting the intense pressure Treasury placed on the British Government to cut expenditures, such as those associated with CENTO, and the possible defense against this pressure provided by U.S. confirmation of support. (Ibid.) The Embassy in London again responded in telegram 9664, November 20, which noted that the British regarded their CENTO review to be complete following the bilateral talks, and the only major question left was how the British CENTO policy would mesh with their policy in the Persian Gulf. (Ibid.) The Embassy in Tehran responded in telegram 4883, November 9, that no real political gains could be accrued from increased usage of CENTO labeling. (Ibid.) The Embassy in Rawalpindi responded in telegram 8611, November 5, that the U.S. attitude expressed in the bilateral talks closely paralleled those held in the Embassy. (Ibid.)