184. Telegram 1349/Polto 2 From the Embassy in Iceland to the Department of State1

Subject: Iceland Base Negotiations—First Meeting of Second Round.

1. Summary. Good atmosphere prevailed during first meeting of second round of negotiations which came on heels of Icelandic Parliament’s approval of Iceland-UK Fisheries Agreement. FonMin showed great interest in civilianization of IDF, including employment of Icelanders, US civilians, US dependents of those already stationed in Iceland, and NATO civilians. While again mentioning GOI aim to get rid of IDF, for first time he accepted necessity of some military units remaining in Iceland and placed no time limits on civilianization process. [Typeset Page 595] It was agreed both sides would avoid comment to press on substance of meeting, and that second session would be on Nov 15, with next round of talks to be held in mid-December, following NATO Ministerial. End summary.

2. FonMin Agustsson apologized that he was not well-prepared for this meeting because Iceland-UK Fisheries Agreement had absorbed his and GOI attention in recent weeks until vote in Parliament earlier this same day. Under Secretary therefore outlined philosophy of US approach, concentrating on demilitarization (reduction of military personnel) and accompanying civilianization, but on condition that IDF remain effective in defense of Iceland as well as US and NATO interests. Under Secretary then noted that as regards reductions of military personnel, 425 persons on rotational duty should be subtracted from IDF total.

3. With respect to civilianization, Under Secretary cited four categories: replacement of US military by Icelanders (with or without personnel security systems), by skilled US technicians, by dependents of those already with the IDF, or by civilians from other NATO countries. Key is replacement and number involved is in hundreds.

4. FonMin raised question about complete demilitarization. Under Secretary replied we could do considerable amount in this direction but the key is maintenance of defense capability. FonMin did not rule out employment of dependents and NATO civilians but expressed interest especially in employment of US civilians. He said establishment of personnel security system was not likely because of Icelandic reluctance to change laws. On Under Secretary’s request for adequate time (up to four years) to recruit and train civilians, FonMin indicated understanding. FonMin also asked whether additional functions could be performed from elsewhere. Under Secretary cited SAR activity as an illustration, but stressed this represented downgrading of defense capability. He also noted some units (i.e. ASW) were already below normal strength. He cited several figures to suggest number of Icelandic nationals who could be employed as replacements in non-sensitive positions.

5. Under Secretary evoked no substantive reaction when he touched on separation of air terminal from base facilities, on liberalization of living and working conditions of IDF, and on application of Icelandic law to Icelanders employed by IDF. On question of type of agreement, Under Secretary mentioned exchange of notes on understanding as to Article VII Plus MOU on details. FonMin said he personally saw no problem with this and believed no new agreement was necessary.

6. FonMin emphasized (for first time) that GOI manifesto merely aimed at getting rid of IDF, but that one must be reasonable. He ob[Typeset Page 596]served he was “instructed” to say that IDF should be all out by mid-1975 but one must find ways to resolve this. Under Secretary pointed out that GOI would be able to see concrete results by mid-1975. FonMin noted he would talk to Prime Minister and others and hoped he could give us green light on some matters at next meeting on Nov 15.

7. On press guidance, it was agreed no substantive comment would be made and FonMin would merely state that another meeting will be held Nov 15.

8. Comment: We believe this session laid essential groundwork for useful progress on Nov 15 along lines of scenario developed in Washington. We do not plan to go beyond that scenario at this time.

  1. Summary: The Embassy reported the first meeting of the second round of the U.S.-Iceland defense negotiations.

    Source: National Archives, Nixon Presidential Materials, NSC Files, Box 693, Country Files, Europe, Iceland, Vol. I. Secret; Exdis. Sent for information to the Secretary of Defense, CINCLANT, the Mission to NATO, and COMICEDEFOR. Telegrams 1357 and 1358, both November 15, discuss the second session of the second round. (Both ibid.) A memorandum of conversation on the November 15 session is also ibid. During an October 15 to 16 visit to London, Johannesson concluded a two-year agreement with Heath that temporarily settled the UK-Iceland fisheries dispute.