Foreign Relations of the United States, 1969–1976, Volume E–9, Part 2, Documents on the Middle East Region, 1973–1976

180. Memorandum From the President’s Assistant for National Security Affairs (Scowcroft) to President Ford¹

Washington, June 7, 1976.

SUBJECT

• Saudi Arabia

Over the past two and a half years, Saudi Arabia has assumed increasing importance in the Middle East and in the broader international economic and political arena. The fundamental reason is that the Kingdom is rich, and will grow richer; its financial reserves, including invested funds, now total more than $40 billion, and it is accumulating additional foreign exchange at the rate of about $25 billion/year. It also produces about one-fifth of all oil outside the Communist world, oil on which Western Europe and the US will become increasingly dependent over the next decade. Although still reluctant to engage itself forcefully beyond the narrow national interest of protecting the Kingdom’s territorial, political and religious integrity, Saudi Arabia is now in position where it can and sometimes does exert considerable influence in the Middle East (principally through providing or withholding financial support for other Arab Governments) and also on the world scene—by its actions within OPEC Councils and on matters broadly affecting the international economy (e.g., the North-South dialogue, world energy and monetary policies, assistance to developing nations).

In light of its special importance, I asked my staff to prepare for you a special background paper (Tab A) describing the regional and world roles of Saudi Arabia. The paper treats both political and economic matters and is divided into four sections: the Middle East, OPEC, the Less Developed Countries, and the Industrialized Countries. It summarizes the basis for potential Saudi influence, as well as Saudi policy objectives, in each of these areas. The actual performance has generally not matched the potential, in part because of problems in the Saudi leadership.

Saudi Leadership Problems

King Faisal’s death in 1974 has not altered the fundamentally conservative, western-oriented, anti-Communist perspective of the Saudi leadership. However, its titular head, King Khalid, is much weaker than Faisal and shares authority to varying degrees with other members of the Royal Family (particularly his more able half-brother Crown Prince Fahd) and close advisors in a loosely structured collective leadership arrangement. While the essential minimum of cohesiveness needed to govern the Kingdom has been maintained, problems are beginning to develop involving personal friction between powerful members of the Royal Family, divergences of view among them on individual policy issues, and the excessive self-indulgence of certain of them. This weakens the regime and, over time, could weaken the country’s ability to cope with threats to its internal stability and basic policy orientation.

The new weaker leadership is presently confronted with two serious challenges: the profound socio-political impact of vast flows of money and foreign personnel into a tradition-oriented Kingdom, and the threat posed by increasing inter-Arab tensions with a resultant upsurge in radical influences working on the Kingdom from without and divisive viewpoints occurring within. These challenges have caused deep concern on the part of the Saudi leaders, a concern augmented by their perception of intensified Soviet efforts to penetrate the Arabian Peninsula/Indian Ocean area, taking advantage of moderate Arab disarray and apparent limitations on the ability of the US to react forcefully.

In reaction to the external threat, Saudi Arabia has joined with Kuwait in an attempt to bring about a reconciliation between Egypt and Syria which would strengthen the position of the Arab moderates, thwart the radical challenge led by Libya, Iraq and Algeria and discourage the USSR. The failure of these efforts thus far to produce significant results may be due to the relative weakness of the post-Faisal regime as well as to the intensity of the mutual alienation between Egypt and Syria. Nevertheless, Saudi efforts to strengthen the Arab moderates will continue. The Saudi leadership is also aware of the Kingdom’s internal problems but apparently considers them less of an immediate danger and much more difficult in terms of agreeing upon a program for their resolution. In dealing with both their external and internal problems, the Saudis are counting heavily upon strong US support.

Saudi-US Relations

Saudi-US relations are good, solidly supported by mutual needs and benefits, similar political perspectives and decades of close cooperation. However, the Saudis are currently concerned over some important aspects of their relationship with the US:

—the general reliability of the US commitment to its friends throughout the world and the uncertain relationship between the Administration and the Congress (with the examples of Vietnam, Turkey, and Angola clearly in mind);

—Congressional initiatives on restricting arms transfers and on the Arab Boycott problem which the Saudis fear could undermine the long-standing USG commitment to Saudi Arabia;

—lack of progress in US efforts on the Middle East problem, and particularly on the Palestinian issue.

It is worth recalling that Saudi Arabia lifted the oil embargo against the United States in 1974 only after the first disengagement agreement between Egypt and Israel and a US commitment to King Faisal to obtain a similar agreement for Syria. Since then our negotiating efforts in the Middle East, including Sinai II, have received strong Saudi support, on the understanding that they will lead to an overall settlement. However, should the United States be unable to restore momentum to the peace process, we can expect a growing coolness in our relations with the Saudis. This would be due to disappointment over what they will perceive as our inability to overcome Israeli opposition and the consequent threat to themselves of a rising tide of Arab radicalism resulting from frustrations over Israeli rigidity and apparent US immobility in the peace process. We must expect that under such circumstances the new Saudi regime will be more inclined to protect itself by accommodation with other Arabs than to standing firmly against radical tendencies, even in isolation, as King Faisal used to do.

Saudi disappointment with the United States for pressing too hard on the Arab boycott/discrimination problem could also lead to a cooling in relations, but to a lesser degree than would a prolonged stalemate in negotiations. The Saudi reaction would tend to be a restriction of purchases from and investment in the US rather than a more fundamental change in attitude. However, this would tend to reinforce any disappointment caused by our inability to generate progress toward a Middle East settlement.

1. Summary: Scowcroft provided a summary memorandum and larger background paper for President Ford on the state of U.S.-Saudi relations and on Saudi relations with other regional and world powers.

   Source: Ford Library, National Security Adviser, Presidential Country Files for the Middle East and South Asia, Box 28, Saudi Arabia (11), 6/76. Secret; Sensitive. Sent for information. A note at the top of the memorandum reads: “The President has seen.” Ford initialed the memorandum. Attached at Tab A but not published is a June 1 paper, drafted by the NSC Staff, entitled “The Role of Saudi Arabia in the Middle East, OPEC, and the International Economy.”