215. Briefing Memorandum From the Director of the Policy Planning Staff (Lake) to Secretary of State Vance 1

Prospects for Expanded Soviet Bloc Role in North-South Problems

Summary and Conclusions

There are two contrasting motives for encouraging the Soviet Bloc to play a more active role in North-South problems, particularly in various measures for economic development, as you suggested at CIEC:2

a) to elicit a genuinely cooperative effort on the part of the Soviet Union, with the aim of maximizing the positive role they have to play in Third World development and dampening East-West political competition; or

b) to silhouette Soviet inadequacies in contributing to Third World needs, with the aim of revealing the gap between Soviet rhetoric and [Page 678]reality and exposing the Soviets to criticism on the part of the developing countries.

The relative weight to be accorded these motives shows up when the complex of North-South issues is broken down into its components: negotiations focusing on the International Wheat Agreement, other individual commodity agreements (except coffee), aid for basic human needs, and the producer-consumer dialogue in energy offer some promise of success in integrating the Soviet bloc into the North-South dialogue in a constructive way.3

On the Food Aid Convention, IFAD, general bilateral aid, multilateral development efforts via the UN, trade, and technology, in contrast, it will be extraordinarily hard to move the Soviets into a pattern of positive contribution.4 But it should be relatively easy to expose the dismal Soviet performance to Third World criticism, without our appearing to conduct an anti-Soviet campaign.

The United States need not choose definitively, between the two approaches. Rather, it can explore both options without foreclosing either.

But there are limits to how much we can expect from this effort. While some Soviet officials have recently been throwing out hints of greater interest, Moscow’s official position is that it wants no part of the “North-South” dialogue as such; that it is a false way of looking at the world and that the real division—between capitalist and socialist countries—puts them squarely on the side of the developing states.

Beyond rhetoric and ideology, the Soviets have not wanted to dilute the political impact of their assistance by subsuming it within broader efforts by the industrialized (read Western) nations.5 And they focus more on arms and military equipment than on economic aid. This gives them a short-run political impact disproportionate to their outlays, and leaves Western countries shouldering the more important, longer-term economic aid burden.

Finally, we should be under no illusion that LDC pressure on the West springs from a notion that the Soviets wear white hats and we black. It reflects, instead, a realistic assessment that we have most of what the LDCs need, and are more likely to give at least some of it.6

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Thus, whether we get the Soviets to cooperate in the North-South dialogue or merely score propaganda points off them, we should not expect it to lessen LDC pressure on ourselves.

The Issues

1. Agriculture

(a) International Grain Agreement

This fall the United States wants to begin negotiations on a new International Grain Agreement. The Soviets want an agreement that will produce stable prices, but have been reluctant to sign an accord that requires reserve stocks. To ensure food security for the Third World there must be grain stocks. The Soviet Union must bear central responsibility: variations in Soviet grain production currently account for about 80% of worldwide production variations. And if history is a guide, the Soviet Union will probably encounter serious weather problems in at least one or two of the next five years. They have an interest in getting an agreement to give them some security on price. Pressing them on the need to contribute to protection against starvation in the Third World might push them over the top toward making a commitment on reserves. Probability of success: moderate.7

(b) Food Aid Convention

This fall we shall start negotiations for a new Food Aid Convention, which will consist of pledges by member countries to donate an annual minimum amount of food aid. The Soviets have not been a member in the past. This year we could seek Soviet membership. Probability of success: extremely low. Prospects for shaming the Soviets: good.

(c) IFAD

IFAD is a fund to finance agricultural development in the Third World via projects carried out by the World Bank, regional banks, or FAO. The Soviets have not promised to contribute. We could press them. Probability of success: almost none. Prospects for shaming the Soviets: moderate.

2. Commodity Agreements

The Soviets are already a member of commodity agreements—cocoa, tin, rubber, and sugar (now defunct). To have successful agreements on sugar, copper, and eventually other materials, we shall have to insist that they make their bilateral agreements public (e.g., Cuban sugar) and that they include intra-bloc trade as part of the world trade [Page 680]for purposes of market control (e.g., copper shipments in Eastern Europe). Probability of success: moderate.

3. Development Assistance

(a) Basic Human Needs

There are some specific areas in which the Soviets might be able to make a productive contribution to development assistance in cooperation with American aid programs. One is the training of paramedical personnel, where the Soviets have a comparative advantage and the South has a great need. Other areas for US-Soviet bloc cooperative aid programs in the “human needs” category might include: a) water treatment; b) waste disposal; c) joint research in host countries on tropical diseases; d) responses to protein deficiency; e) immunization; f) clinics and low-cost health delivery systems. (Note: Cuba has an outstanding record in organizing and managing programs, especially rural programs, in many of these areas.)

The US Congress might not like the notion of joint ventures, especially with Cubans. It might be well to begin by adding LDC needs to the agenda of ongoing US-Soviet exchanges on, for instance, agriculture, housing, and medical subjects. Probability of success: unknown.

[Omitted here is information unrelated to agricultural issues.]

  1. Source: Carter Library, National Security Affairs, Staff Material, Office File, Outside the System File, Box 48, Chron: 6/77. Confidential. Drafted by Theodore Moran and Jennone Walker; concurred in by Boeker and Frank and in draft by Martin Kohn (INR/REC/CER) and Barry. Tarnoff also initialed the memorandum. The President wrote on the memorandum: “Some good ideas—J.” Vance sent a copy to him under a June 26 memorandum. (Ibid.) The transmittal memorandum is scheduled for publication in Foreign Relations, 1977–1980, volume I, Foundations of Foreign Policy.
  2. See Document 214 and footnote 4 thereto.
  3. The President placed two vertical lines to the left of the paragraph beginning with the word “negotiations.”
  4. The President placed two vertical lines to the left of the paragraph next to the first sentence.
  5. The President placed two vertical lines to the left of the paragraph next to the first sentence.
  6. The President placed two vertical lines to the left of this and the following paragraph.
  7. The President wrote in the margin next to this paragraph: “Let them know the consequences of not cooperating also.”