Office of the Historian

343. Telegram 81789 From the Department of State to the Embassy in the Philippines, April 5, 1976, 2357Z.1 2

April 5, 1976, 2357Z

TELEGRAM
Department of State
081789

R 052357Z APR 76

FM SECSTATE WASHDC TO AMEMBASSY MANILA
INFO USDEL MTN GENEVA
CINCPAC HONOLULU HI

STATE 081789

LIMDIS CINCPAC FOR POLAD

E.O. 11652: GDS
TAGS: ETRD, RP

SUBJECT: PHILIPPINE NEGOTIATIONS — MEETING WITH VIRATA

1.
APRIL 2 FINANCE SECRETARY VIRATA, AMBASSADORS VEGA AND SUAREZ, MET WITH ASSISTANT SECRETARY HABIB, AMBASSADOR SULLIVAN AND DEPUTY ASSISTANT SECRETARY EDMOND. FOLLOWING ARE MAIN POINTS OF CONVERSATION. MEMCON BEING POUCHED.
2.
VIRATA CONFIRMED THAT TAX TREATY APPEARED AGREED SUBJECT TO FINAL REVIEW OF TEXT. HABIB NOTED THAT TEXTILE CONSULTATIONS NOT SUCCESSFUL BUT SUGGESTED NEW EFFORT AIMED AT TRANSFER BETWEEN TRADITIONAL AND NONTRADITIONAL CATEGORIES.
3.
REGARDING ECONOMIC NEGOTIATIONS, HABIB SAID PHILIPPINE TRADE OFFERS SO FAR DID NOT APPEAR VERY CONCESSIONAL, THAT U.S. APPRECIATED HAVING PHILIPPINE DRAFT ON INVESTMENT AND WOULD REVIEW IT, AND U.S. WOULD EXPLORE POSSIBILITY OF GSP WAIVER. HOWEVER, HE STRESSED THAT BLANKET WAIVER GOP SEEKING IS NOT IN THE CARDS AND THAT ESSENTIAL REQUIREMENT FOR AGREEMENT WAS A SATISFACTORY OVERALL PACKAGE THAT THE UNITED STATES COULD ACCEPT AS BEING IN ITS INTERESTS. ASKED HOW HE SAW NEGOTIATIONS PROCEEDING, HABIB SAID HE FELT WE WERE IN FIRST STAGE AND THAT AFTER A FEW MORE EXCHANGES WE WOULD PROBABLY WANT TO RECESS AND EACH SIDE CONSIDER THE OTHERS PROPOSALS FOR A PERIOD OF TIME. HE INDICATED THAT WE FELT WE SAW THE SHAPE OF AN ULTIMATE AGREEMENT, BUT THAT IT WOULD TAKE CONSIDERABLY MORE WORK TO ACHIEVE.
4.
TO VIRATA INQUIRY ON LINKAGE OF ECONOMIC AND BASE TALKS, HABIB REPLIED THAT WE VIEWED THEM AS SEPARATE, WITH EACH PROCEEDING ON ITS OWN MERITS. HE THOUGHT THE ECONOMIC NEGOTIATIONS WOULD BE THE MORE DIFFICULT OF THE TWO. BASE TALKS HE FELT SHOULD PRESENT RELATIVELY FEW PROBLEMS, SINCE THE PHILIPPINES RECOGNIZED THE DESIRABILITY OF THE U.S. RETAINING ITS BASES AND THE U.S. RECOGNIZES THE NEED TO MEET REQUIREMENTS OF PHILIPPINE SOVEREIGNTY. HE REJECTED A COMPARISON WITH SPAIN POINTING OUT THAT THE U.S.-PHILIPPINE RELATIONSHIP IS BASED ON A MUTUAL DEFENSE TREATY. KISSINGER
  1. Source: National Archives, Record Group 59, Central Foreign Policy Files. Secret; Limdis. Repeated to the MTN Delegation in Geneva and to CINCPAC in Honolulu. Drafted by Willner, Country Officer for the Philippines; cleared by Edmond; and approved by Habib. The memorandum of conversation is in the Ford Library, National Security Adviser, NSC Staff for East Asia and Pacific Affairs, Convenience Files, Box 10.↩
  2. The Department of State reported on a meeting between Habib and Virata that covered economic aspects of the U.S.-Philippines relationship.↩