262. Record of a Meeting of the Council on International Economic Policy Senior Review Group1
- Edwin M. Martin
- Thomas O. Enders
- Department of State
- Charles H. Cooper
- Howard Worthington
- Department of the Treasury
- Clayton K. Yeutter
- Don Paarlberg
- Richard E. Bell
- Department of Agriculture
- Frederick B. Dent
- Lawrence A. Fox
- Robert S. Milligan
- Department of Commerce
- Gary Seevers
- Council of Economic Advisers
- B. A. Bridgewater
- Phil DuSault
- Office of Management and Budget
- Harald B. Malmgren
- Office of the Special Representative for Trade Negotiations
- Roger E. Shields
- Department of Defense
- Daniel Parker
- Phil Birnbaum
- Agency for International Development
- Council on International Economic Policy (CIEP) Senior Review Group Decisions on the Dairy Issue and the World Food Conference
At the CIEP Senior Review Group meeting of August 23, 1974, the following decisions were taken:
[Omitted here is discussion unrelated to the World Food Conference.]
II. World Food Conference
The U.S. will suggest for purposes of encouraging discussion and comment, but not as a negotiating proposal, that consideration be given to an international system of grain reserves in the range of 30 to 60 million metric tons above world-wide working stocks. The SRG agreed that the reserves should be over and above working stocks, that the targets for countries should be based on a combination of reserves and working stocks, that the targets should be calculated as a total of all grains, and that rice should be included in the definition of grains.
It was agreed for present purposes that a combination of three criteria should be used in discussing how the burden of sharing reserves should be distributed. These criteria include the level of gross domestic product, the trend level of imports and exports, and the variation from trend in total grain production. It was further agreed that the export/import criteria would include a proposal that two-thirds of the reserves be held by importers and one-third by exporters. Among importers, some distinction will be made between less developed countries (LDCs) and developed countries.
The SRG authorized Ambassador Martin to present these ideas as our present thinking. He should in particular present the range of reserves and the criteria for burden sharing, not as the U.S. position, but as a plausible framework for discussion in the present economic context, without commitment to our possible positions in the future in any more firm negotiating context. Ambassador Martin is not authorized to pursue these points with greater specificity in the context of the World Food Conference. The details will be left for negotiations following the World Food Conference.
U.S. Government (USG) Role
It was felt that a U.S. commitment to a reserves system would be interpreted as a USG commitment to hold reserves if necessary. The SRG agreed that Ambassador Martin must make it clear in his consultations and at the World Food Conference that the USG is not commiting itself in advance to hold reserve stocks and that the U.S. reserves the right to determine how it will fulfill any reserves commitment.
Ambassador Martin presented a draft resolution which outlines in very general terms the U.S. thinking at this time. The draft resolution was approved in principle by the SRG, with the exception of two specific reservations and a general proviso that we should avoid undue specificity where possible. The specific reservations were:
- STR and Treasury objected to the World Food Conference follow-up procedures as outlined in paragraph three of the resolution.
- OMB objected to the language in paragraph 4b concerning the calculation of reserves.
Ambassador Martin agreed to resolve these differences with the agencies involved before presenting the resolution to other World Food Conference participants.
Future Work Schedule
Ambassador Eberle and Gary Seevers will agree on a new chairman for the working group which will focus on the following issues:
- Reserves versus stocks analysis for burden sharing.
- Accumulation and release criteria for stocks, including budget costs.
- A system of sanctions to get countries to participate in the reserves system.
- Food aid policy.
In addition, a Special Task Force of the Trade Steering Group will be established to clarify those issues which need to be negotiated further in the context of the MTN and the longer term commercial objectives of the U.S. in relation to reserves, stocks, and world food security questions generally.
- Source: National Archives, RG 429, Records of the Council on International Economic Policy, 1971–1977, Box 255, Senior Review Group Meetings, 1971–1974, 53908 From W. D. Eberle Re Calls CIEP/SRG Meeting for 2 p.m. August 23, 1974 Agenda: International Grain, World Food Conference, Grain Reserve, Trade Issues and Dairy Issue Date 8/22/74. Confidential. Prepared by J.M. Dunn of the CIEP staff; revised on August 28. Background materials for this meeting are in the Ford Library, National Security Council, Institutional Files, Box 12, Senior Review Group Meeting, 8/23/74—Food Committee and CIEP.↩
- No classification marking.↩
- Thus keeping room for some play of market forces in adjusting demand and supply. [Footnote is in the original.]↩
- This formula includes no provision for consumption above trend. [Footnote is in the original.]↩