Foreign Relations of the United States, 1977–1980, Volume XX, Eastern Europe

299. Telegram From Secretary of State Muskie to the Department of State¹

New York, September 25, 1980, 1833Z

Secto 8014. Subject: (U) Secretary’s Bilateral With Yugoslavian Foreign Minister Vrhovec.

1. Confidential-entire text

2. Summary: Yugoslavian Foreign Minister Vrhovec met for an hour with Secretary Muskie and continued the conversation for an additional 40 minutes with Under Secretaries Newsom and Nimetz after Secretary Muskie left to attend UNSC meeting. The conversation covered the full range of current international issues, as well as the Yugoslav economic situation, the Markotic case, and Assistant Secretary Derian’s testimony on human rights. End summary.

3. The meeting lasted from 4:30 p.m. until 6:10 p.m. on September 23. U.S. attendees were the Secretary, Under Secretary Newsom, Under Secretary Nimetz, and Deputy Assistant Secretary Barry. Yugoslav attendees were Foreign Minister Vrhovec, Ambassador to the U.S. Loncar, Ambassador to the UN Komatina, and Vrhovec’s Chef de Cabinet.

4. Secretary Muskie opened the conversation by expressing regret that he had not been able to accompany the President to Yugoslavia in June. Vrhovec commented that the President’s visit had been extremely successful, particularly because of the President’s statements while in Yugoslavia. He noted that Pravda had commented critically on what the President had said, but that a “very high Eastern European official” had recently asked Vrhovec for a Yugoslav assessment of the visit. When Vrhovec responded that the Yugoslavs considered the visit contributed to detente, the “EE official” said that he had thought so too but had wanted to hear this directly from the Yugoslavs.

5. U.S.-Soviet relations. The Secretary and Vrhovec discussed the Gromyko UNGA speech which Muskie described as defensive. Vrhovec said that while the speech had been tough, it was also businesslike and kept doors open. Muskie commented that Gromyko had very little to say on Afghanistan and seemed to be trying to indicate that events there had nothing to do with U.S. and Western attitudes toward the USSR. This clearly does not represent the serious view of the Soviet leadership but we can not tell whether they consider that they made a mistake in Afghanistan by underestimating Western reactions. Muskie said that in his discussions with Gromyko in Vienna and correspondence since then Gromyko has shown no flexibility but has not been hostile or abrasive. The Soviets may be looking for an open door, but they clearly don’t know where it is. Vrhovec opined that the Soviets may actually be ready to talk about a way to get out of Afghanistan, but it was not reflected in Gromyko’s speech. It could be that the Soviet’s are prepared to talk business with the U.S., but at times like that they always play their cards very close to their chest and display a more rigid public image than usual.

6. Iraq-Iran. In response to the Secretary’s query about a non-aligned role in Iraq-Iran hostilities,² Vrhovec suggested that neither side would ask for NAM assistance until it became clear that one side or the other was prevailing militarily. On the question of motivations, Iraq believed that Iran’s military weakness provided an opportunity to humiliate Khomeini and destroy the Iranian Government. Iran similarly is bent on undermining the Iraqi Government. Thus, both parties to the conflict have far-reaching goals. Vrhovec said that Yugoslavia had tried to open sensitive communications with the parties to see if they could be calmed down, but both were unpredictable. Secretary Muskie said that with the threat of blocking the Straits of Hormuz and blocking shipping in and out, the international community could not afford to lose time in ending the hostilities.

7. UN initiatives on Afghanistan. Under Secretary Newsom asked what Yugoslavia knew about possible UN initiatives on Afghanistan. Vrhovec said he had talked to Agha Shahi yesterday, and it was hard to see what could be achieved. Shahi was consulting on his initiative concerning an international conference which would focus on Soviet withdrawal and efforts to calm the situation. However, the “other side” had another resolution in its pocket designed to undo the Shahi proposal. To have two competing resolutions would be a bad thing. In Yugoslavia’s view it would be good to get a consensus resolution to resolve the problem but not to see rival ideas put forward.

8. Yugoslavia economic situation. As Secretary Muskie was about to leave for a UNSC meeting, he told Vrhovec that he and the President were deeply interested in Yugoslavia’s efforts to deal with its economic problems and anxious to be as helpful as possible. Muskie pointed out that the President has expressed this interest before in Belgrade and maintained it today, and that public opinion supported U.S. efforts in this regard. He invited Vrhovec to convey the Yugoslav position on this, on the situation in Poland, and on other matters of concern to Under Secretary Newsom, who would report to him on the remainder of the discussion. Vrhovec, who was clearly not up to date on the current state of Yugoslavia’s efforts to obtain financing, began by stressing that a Western bail-out was politically unacceptable to Yugoslavia. Thus, they sought middle ground between the purely bilateral approach they favored and the global syndication which had been pressed on them by Chase. Ambassador Loncar pointed out that this conceptual problem had been resolved through Yugoslavia’s two-track approach, and that the main questions now were to be certain that the syndication in which U.S. bankers participated produced enough money to meet Yugoslavia’s expectations and that the negotiations be concluded as rapidly as possible.

9. Poland. Vrhovec pointed out that the U.S. approach to the situation in Poland had been a sensitive one. Events there represented a very serious development, unfavorable to the USSR. Yugoslavia regarded developments so far as positive, proving that a way of life imposed from outside was intolerable over time. Vrhovec noted that so far the Soviets had been restrained in their behavior and their propaganda. The fact that events in Poland had not turned into an East-West confrontation had contributed to a positive evolution in Poland. Yugoslav PermRep Komatina chimed in to point out that a very important East European official had recently commented that what had happened in Poland was incompatible with Marxism/Leninism, but that it was hoped that these new developments would “melt” as the economic situation improved.

10. Markotic case.³ Under Secretary Newsom brought up the Markotic case in the name of the Secretary, urging that the Yugoslavs find a solution to this problem compatible with our good political relations. Vrhovec reacted without emotion and said he wished devoutly that Markotic had never come to Yugoslavia. He pointed out that he had been forced to “engage” the Yugoslav leadership to get information on this case. While the sentence they handed out was severe, it was understandable. Vrhovec pointed out that while the sentence was within the framework of Yugoslav law, the authorities had interpreted the law as harshly as possible. The case had not yet reached its final stage, and he hoped the higher courts would take a different approach. Newsom said we did not want to interfere in Yugoslav law, but that given the number of Americans who also held Yugoslavian citizenship, he hoped for a resolution which would not interrupt the movement of people back and forth, and would recognize American interest in this type of case and consider leniency.

11. Derian testimony.⁴ Ambassador Loncar raised a point about which he said he had not had an opportunity to brief Vrhovec in detail. He objected to the inclusion of Yugoslavia in Assistant Secretary Derian’s testimony on human rights in Eastern Europe, to some of the specifics in the statement, and to the fact that the statement was circulated by the U.S. Embassy in Yugoslavia. Mr. Newsom stressed there had been no change in U.S. policies toward Yugoslavia and pointed out that our policy had been clearly and authoritatively enunciated by the President and the Secretary of State.

12. Global negotiations. Vrhovec asked Newsom if he saw any possibility of a breakthrough in negotiations at the UN. Newsom pointed out that Ambassador McHenry believed that a solution could be found once the overheated atmosphere of the Special Session cooled off. Newsom pointed out that the U.S. could not agree to any formulation which detracts from the authority of UN specialized agencies or international financial institutions, especially in view of the difficulty the U.S. was having in getting congressional funds for these institutions. Vrhovec said that the Yugoslavs and others had hoped that a vague formulation would enable the U.S. to agree since this would only result in the beginning of talks at which all issues would be discussed in detail again. Newsom pointed out that Washington agencies were not prepared to accept vagueness of this kind and required recognition of UN specialized agencies’ roles and independence. However, he said that no one was more anxious than Ambassador McHenry to find a solution to the problem.

Muskie

1. Source: National Archives, RG 59, Central Foreign Policy File, D800458–0419. Confidential; Immediate; Exdis. Also sent to Belgrade. Sent for information Immediate to Moscow, Warsaw, USUN, Baghdad, and Havana. Muskie was in New York to attend the opening of the 35th Session of the UNGA.
2. Iraq invaded Iran on September 22, 1980, marking the start of the Iran-Iraq War, which ended August 2, 1988.
3. Mirko Markotic was a naturalized U.S. citizen of Yugoslav (Croatian) descent. He traveled to Yugoslavia in May 1980 and was arrested immediately after his arrival. The Yugoslav Government tried and sentenced him to jail time for “anti-government activities,” and refused to allow U.S. officials visitation rights, arguing that Markotic was a Yugoslav citizen. On September 1, Eagleburger wrote that Washington “must exact a price, even though to do so will certainly affect the course of what has been over the past three years an increasingly warm and cooperative bilateral relationship.” However, Eagleburger cautioned, the United States should not allow the Markotic case to affect Washington’s attitude toward assisting Yugoslavia with its balance of payments challenges. (Telegram 6817 from Belgrade, September 1; National Archives, RG 59, Central Foreign Policy File, D800416–0995) On January 11, 1981, the Presidency of Yugoslavia granted amnesty to Markotic “in consideration of the excellent overall state of our bilateral relations.” (Telegram 186 from Belgrade, January 12, 1981; National Archives, RG 59, Central Foreign Policy File, D810015–0788)
4. On September 16, Derian testified before the Subcommittee on International Organizations of the House Committee on Foreign Affairs on the status of human rights in the Soviet Union and Eastern Europe. (Current Policy, No. 204, U.S. Department of State, October 1980) Responding to a congressional inquiry, Derian included Yugoslavia in the presentation, and discussed the Markotic case, eliciting a protest from the Yugoslav Government. (Telegram 7453 from Belgrade, September 19; National Archives, RG 59, Central Foreign Policy File, D800447–0459) While in West Berlin, Eagleburger wrote that it was unwise to lump together Yugoslavia with the other Warsaw Pact countries as doing so does not serve U.S. foreign policy. “We are dealing with an uncertain and therefore neuralgic post-Tito leadership,” he cautioned, and “how we handle that fact can have a substantial impact on the future of our bilateral relations.” (Telegram 1996 from West Berlin, September 17; National Archives, RG 59, Central Foreign Policy File, D800444–0096) Hoping to resolve the issue prior to the Muskie-Vrhovec bilateral, the Department instructed the Embassy to deliver the U.S. response, emphasizing that the administration “make a very clear and fundamental distinction between nonaligned Yugoslavia and the countries of the Warsaw Pact” and stress that there was no change in U.S. policy toward Yugoslavia. (Telegram 251422 to Belgrade, September 20; National Archives, RG 59, Central Foreign Policy File, D800450–0059) The Embassy delivered the U.S. response to the Foreign Ministry on September 22.