Foreign Relations of the United States, 1977–1980, Volume XXII, Southeast Asia and the Pacific

199. Memorandum of Conversation¹

Washington, October 7, 1977, 11:30 a.m.–12:30 p.m.

PARTICIPANTS

• U.S.

  • President Carter
  • Vice President Mondale
  • Warren Christopher, Deputy Secretary of State
  • Zbigniew Brzezinski, Assistant to the President for National Security Affairs
  • John Holdridge, Ambassador to Singapore
  • Richard Holbrooke, Assistant Secretary of State for East Asia and Pacific Affairs
  • Mike Armacost, Staff Member, NSC

• Singapore

  • Prime Minister Lee Kuan Yew
  • Sinnathamby Rajaratnam, Foreign Minister
  • Goh Chok Tong, Senior Minister of State for Finance
  • Punch Coomaraswamy, Ambassador to the U.S.
  • Ram Chandra, First Secretary, Singapore Embassy
  • James Fu, Press Secretary

The President met privately with Prime Minister Lee from 11:30 to 11:55 a.m. in the Oval Office.² In the larger meeting in the Cabinet Room the President began by giving Prime Minister Lee a copy of Why Not the Best? and a portfolio of earth satellite photography. The President noted that in the private meeting he had informed the Prime Minister of U.S. willingness to sell Singapore production data for the M–203 grenade launcher. He had also informed Lee that sale of I-Hawk air defense missiles would contravene our arms transfer guidelines.³ The President added that Lee had apprised him of the reasons for Singapore’s desires for I-Hawks, and that he had agreed to review the matter further.

The President asked Prime Minister Lee for his assessment of recent developments in Southeast Asia, with particular emphasis on the attitudes and policies of Vietnam, China, and the Soviet Union in that area.

Prime Minister Lee asserted that the psychological climate in Southeast Asia is unsettled. In part this is because change is in itself unsettling; in part it results from uncertainties about President Carter and his new team, e.g. the emphasis on human rights, and the prolonged silence about Asia by the Administration earlier in the year, except for the Korean troop withdrawal announcement.⁴

Lee noted that these anxieties have subsided recently. The Vance speech was helpful in affirming a continuing U.S. role,⁵ but one which acknowledges new realities and is based upon greater expectations of self-help by the nations of the area. The most important requirement for U.S. policy, Lee maintained, is to preserve a climate of confidence and stability in Southeast Asia by making clear our intent to keep a strategic and economic presence in the region.

He suggested that there is a lurking fear that the Soviet thrust in Asia cannot be deflected merely by arms control proposals to stabilize the USSR’s presence in the Indian Ocean. Acknowledging that the Soviets had encountered frequent setbacks in the past, Lee emphasized that the Soviets are persistent, and the determined Soviet thrust to achieve world supremacy must be matched by U.S. resolve to frustrate the Soviet’s relentless drive for domination. “The Soviets are long-term players in the game, and I would like to leave Washington with the reassurance that the Americans, despite changes in style and in the relationship between the Executive and the Legislature, have the same resolution.” It goes without saying, Lee added, that Southeast Asians would not expect American involvement in local guerilla wars.

Lee indicated that Singapore regards itself as being irrevocably committed to the Western world, but he described insistent Soviet pressures to establish more substantial ties with Singapore. First the Russians sought to secure berthing rights for navy ships. This was refused. Then they sought to utilize Singapore for the repair of merchant marine vessels. Singapore now contracts for repair services, but Lee has noticed that the Soviet trawlers that put into dock carry all kinds of modern electronic equipment. One cannot ever be sure of what kinds of activities they are engaged in. Singapore is not loathe to demonstrate its support for the United States. It has long provided access to its ship repair facilities and to its oil. Last year Lee said he was asked to take another step forward by allowing Orions and P–3C’s to stage out of Singapore in order to maintain more efficient surveillance over Soviet activities in the Indian Ocean. The Soviets, he said, do not view this sort of cooperation kindly. Singapore is prepared to assume these risks, but would find them more acceptable if assured that the U.S. will be tenacious in pursuing its competition with the Soviet Union.

Lee then turned to the economic side of the equation, emphasizing that the most important objective for the Southeast Asian governments is rapid economic growth and a more equitable distribution of its benefits. If the needs of ASEAN countries for investment and trade are not recognized, efforts to compete strategically are meaningless. Lee commented that the Japanese have recently adopted a somewhat more forthcoming attitude toward economic assistance in Southeast Asia, but the Japanese cannot do it alone. Over the years the Americans have been most forthcoming, and their contributions in the future would be decisive. Lee expressed special concern that proposed changes in our tax deferral rules might discourage foreign investment. If such investments falter and growth is not sustained, he predicted an erosion of confidence, political confusion, and growth of local insurgencies, and temptations for Vietnamese adventurism.

The President replied that the U.S. has long been committed to competition with the Soviet Union, peaceful if possible, but with force if necessary. He expressed confidence that our military forces remain superior to those maintained by the Soviets, and he noted that we possess monitoring capabilities adequate for assessing trends in the East-West balance with some precision. A thorough analysis of the US-Soviet competition provides ample grounds for confidence that the U.S. retains a stronger relative position with respect to virtually every significant measurement of national power.

The President said he was proud that Singapore has cast its lot with the West, and he regarded Singapore as an important part of the West’s economic, political and military strength. We need not only quiet displays of cooperation, but public demonstrations of our close relations—noting with satisfaction the prospect of cooperative arrangements with regard to the transit of P–3C’s.

In economic terms, the President noted the value we attach to having U.S. companies invest heavily in Southeast Asia. He also noted a growing feeling that to the extent the U.S. Government encourages private investment, it should be encouraged principally in countries with low per capita income, i.e. those which need it the most. He suggested that Singapore could perhaps sustain a sizeable flow of American investment through bilateral treaties which would provide confidence against such contingencies as confiscation or inequitable tax treatment. As for tax reform legislation, the President indicated he could not predict how this would ultimately come out, but he welcomed the chance to hear the concerns of the Prime Minister. The President also noted his satisfaction with the recent conclusion of a US-Singapore civil air agreement.

The President invited Prime Minister Lee to offer his counsel and advice at any time. Expressing appreciation for Prime Minister Lee’s frank assessment of trends, he said it would be a pleasure to receive directly communication of any concerns he might have in the future.

The Prime Minister thanked the President for the invitation, and said he would take him up on it.

1. Source: Carter Library, National Security Affairs, Staff Material, Armacost Chron File, Box 5, 10/1–14/77. Secret. The meeting took place in the Oval Office and the Cabinet Room at the White House. Lee was on an official visit to the United States October 4–12.
2. No memorandum of conversation of the private meeting has been found.
3. See Document 198.
4. On June 5, the administration announced that it had informed the South Korean and Japanese Governments that the United States would remove 6,000 American ground troops from South Korea by the end of 1978. (Bernard Gwertzman, “6,000 Ground Troops in Korea Will Leave By End of Next Year,” New York Times, June 6, 1977, p. 1)
5. See footnote 2, Document 196.