240. Memorandum From the Special Representative for Economic Summits (Owen) to President Carter 1

SUBJECT

  • The Venice Summit

This memorandum reports on a trip to Italy last week to meet with representatives of the Summit nations to prepare for the Venice Summit.

1. Macro-economic policy. There was general agreement that the Summit communique should, as recommended in a paper that Charlie Schultze prepared for our group,2 call for continued fiscal/monetary restraint—plus measures to improve productivity by encouraging the shift of resources from consumption and the public sector to investment. The Canadians (whose new government’s3 views on macro-economic policy appear to diverge from those of other Summit governments) indicated some reservation about committing themselves to politically unpopular measures for the latter purpose. Others said that it would help their heads of government to take these difficult measures if the Summit said that they were needed. (C)

2. Energy. Only the Germans objected to some kind of quantitative goals or yardsticks for (i) reduced oil imports in 1985 and 1990, and (ii) aggregate increased production of alternative energy sources by 1990. All agreed that present efforts in both these areas are inadequate. It was also agreed that there should be close monitoring of commitments, to make sure that they are fulfilled. The French thought that a collective commitment to increased production of alternative energy [Page 695]sources (coal, nuclear power, synthetics) should be the main outcome of the Summit. All saw energy as being its main business.

3. North/South. All, except the British (who are cutting their foreign aid), agreed that more attention should be paid to North/South issues at this than at previous Summits. The German proposal to focus on helping LDCs produce energy found favor; so did the US suggestion that the World Bank be asked to examine means of increasing its activities in this field, including the possibility of creating a new IBRD affiliate for this purpose, in which OPEC could play a large financing role. It was agreed to convene a special Summit preparatory sub-group to examine the US proposal to give the war on hunger higher priority in the Summit countries’ aid programs—with particular emphasis on increased food production, improved food storage, and strengthened agricultural research.

4. Political. The French delegate objected to any Venice consideration of political issues (although this didn’t prevent him from agreeing that strong language about terrorism should be included in the communique). The British said that they had been told the French would eventually agree to Summit consideration of political issues, if this was done informally. The Italians may propose that a seven-nation group, which would be an extension of the present Summit Preparatory group, meet before the Summit to canvass political issues. Several delegates spoke of the need for some such means of involving Japan, the major EC countries, and the US on a regular basis in informal consideration of political issues [before?] they come to a head, quite aside from Summit preparations.

5. Scheduling. There will be an 8:30 breakfast on the first day for the heads of governments to figure how they wish to run the Summit. (This leaves you free to arrange a breakfast of the four on the second day, if you wish.) The general view was that it might be wise to start the first day with a brief discussion of economic issues, so that the economic types could then go off to revise the draft communique in light of this discussion, while heads of governments devoted most of the first day and their dinner to political issues. The second day would be devoted to economic issues. The press conference will be at 6:00 p.m. of the second day.

6. Comment. I agree with the French that a collective commitment to greatly increased production of alternative energy sources should be the Summit’s main outcome. It would help to elicit efforts from other Summit nations comparable to those the US now plans to undertake. At a dinner for OECD Secretary General Van Lennep last night, Congressman Wirth said that he thought such a commitment by the industrial nations would be welcomed by the American people as a sign that [Page 696]the energy problem was being tackled on the global scale required for success. It would, he thought, redound to your political benefit.

It would also, I believe, provide the sense of allied cohesion that comes from jointly mounting a large and useful undertaking—responding to the current crisis, by making us less dependent on vulnerable Middle Eastern oil, in somewhat the same way that the Marshall Plan responded to the crisis of 1948, by enhancing Western Europe’s ability to resist Soviet pressure. The Summit countries seemed more ready at this meeting to join in this kind of commitment than they were at our previous meeting, perhaps because events in Iran have highlighted the insecurity of their sources of oil supply.

7. Your Bilateral Visit. Dick Gardner has some interesting ideas about your bilateral visit—about one of which I will write you about separately: a meeting between you and representatives of the FAO and the other three international food organizations headquartered in Rome, at which you would receive a medal honoring your contributions to food and agriculture in poor countries.4 He also suggested you be accompanied to Rome by leading Americans of Italian descent (as Schmidt is accompanied by prominent German businessmen and labor leaders on his bilateral visits overseas); I have reported this suggestion to Al McDonald.

8. Next Steps. The Italians will now prepare a first draft of the communique along the lines indicated above. They will send it to members of the Preparatory Group in mid-May, and I will submit it to you for review then. The Preparatory Group will meet again in late May and early June to put the communique in final shape, so that it will be ready for submission to the Venice Summit.

  1. Source: Carter Library, National Security Affairs, Brzezinski Material, Subject File, Box 65, Summits: 9/79–5/23/80. Confidential. Carter wrote at the top of the page: “Sounds ok. C.” Brzezinski also initialed at the top of the page.
  2. The paper was not found.
  3. Prime Minister Pierre Trudeau formed a majority Liberal government in Canada after the February 1980 Federal election.
  4. Neither a memorandum from Owen to Carter on this proposal nor any record of the proposed meeting between Carter and international food organization representatives was found.