231. Memorandum of Conversation1

SUBJECT

  • Meeting and Lunch with Australian Foreign Minister Peacock

PARTICIPANTS

  • US

    • The Secretary
    • Richard Holbrooke, Assistant Secretary, EA
    • Christopher A. Squire, EA/ANP (Notetaker)
    • PLUS (AT LUNCH)
    • Charles W. Duncan, Deputy Secretary of Defense
    • Philip C. Habib, Under Secretary of State for Political Affairs
    • Admiral Stansfield Turner, Director, Central Intelligence Agency
    • Robert Oakley, Deputy Assistant Secretary, EA
    • Michael Armacost, National Security Council
    • (Deputy Secretary of State Warren Christopher joined for a short time)
  • AUSTRALIA

    • Foreign Minister Andrew Peacock
    • Ambassador Alan Renouf
    • First Assistant Secretary Rawdon Dalrymple
    • Minister Philip Flood

The Secretary said he had read reports of Minister Peacock’s press conference of March 24, and very much appreciated how the Minister had downplayed the contretemps over the Indian Ocean. He noted that in Alan Renouf Australia had a first-rate Ambassador in Washington. Peacock said that Renouf had been his own personal choice. The Secretary added that in Philip Alston he knew that Australia would have a first-rate American Ambassador as well. Peacock answered that he had telephoned Alston last evening and spoken with him at some length. Peacock had been impressed not only in speaking to Alston but also by what he had heard about him as well. Mr. Alston had said that he hoped to reach Australia late in April. The Secretary said that we expected to be able to request agreement of the Australian Government around the first of next week. Peacock said he would personally hand the request to the Governor General, and expected to get a favorable answer within two days or so.

Mr. Alston, said the Secretary, was one of the four or five people in the country closest to President Carter. Apart from Charles Kirbo and perhaps one other person, the President was most comfortable with Philip Alston.

He would like to start with the hard question right away, said Minister Peacock. How did the Secretary see Australia in his thinking?

The Secretary answered that he had a twofold response to that question. In the Pacific, the US needed Australia’s help and advice across the whole spectrum. But the US would like to see that help and advice reach far beyond the Pacific. Australia could and should participate in global problems, particularly the economic problems which today seem the most severe.

There is a limit to what Australia could do on the global economic side, answered Minister Peacock.

(At this point Deputy Secretary Warren Christopher joined the meeting).

Minister Peacock noted that he had taken the liberty of saying to Dick Holbrooke, who had asked if Australia would feel too bad if the [Page 757] Secretary of State could not go himself to the ANZUS Council meeting, that Australia would certainly hope for Deputy Secretary Christopher instead.2 While he could not answer for New Zealand which might be terribly upset, added Peacock, Australia certainly would not be upset. Australia would welcome Mr. Christopher, with whom he was doubly glad to meet right now. Again, Mr. Peacock added, he was very grateful for the fact that the Secretary had fixed it up for Prime Minister Fraser to meet with President Carter in June.3

To return to the North/South issue, continued Peacock, he would like to do more. Discussions were underway within the Australian Government. Australia should concentrate on the particular problems of her geographic region. This was Peacock’s view, not necessarily that of his Government; she should take steps to act in Southeast Asia. Australia could make a contribution in many areas, but that could best be done in Australia’s own geographic area. The countries of Southeast Asia see any steps which Australia might take as undoubtedly helping them in their dealings with Japan.

On the whole concept of trilateralism, continued Peacock, Australia has been somewhat troubled. Australia understood the European conglomerate leg, and the North American leg. But for the third leg, the US seemed to stop with Japan. In Australia’s view this could be myopic, as to the real role Japan could play in the near future in Southeast Asia. Australia’s relations with Japan were of singular importance. Australia recently signed a basic trade treaty with Japan, which was a first for both countries. The Australian Prime Minister had visited Japan. Australia and Japan had agreed to cultural exchanges, the Australian beef quota had been increased, and Australia had provided port access to Japanese fishing vessels which was a point of great importance to Japan. All in all, Japanese-Australian relations were very sound. Australia was, in short, an influence in her geographic area; she believed she could get things done in that area. But in Southeast Asia Australia realized that there was somewhat the same suspicion of Japan as there was of Australia.

What do you think we should do with regard to ASEAN, asked the Secretary.

ASEAN feels very uncertain of the United States, said Peacock. If Australia at times is uncertain, one can imagine how ASEAN nations feel. Peacock said he was to visit the Philippines, Thailand and Malaysia in two weeks time. It was terribly important that Australia and the US [Page 758] keep in close contact with these countries. He would repeat what he told them last year, added Peacock. It was totally explicable that the US would not publicly discuss the area until after the 1976 elections. Peacock would tell them not to rely on the absence of US rhetoric about the area as the sole reason to worry (although he noted that there had been a reference to the area in the President’s UN speech).4 If the US was serious about sending an official out to hold talks, that would be a great reassurance for them.

The Secretary replied that the US would probably send Dick Cooper, as he had been talking with Deputy Secretary Christopher on North/South dialogues.

Peacock asked if the Secretary would be going to CIEC.5 The Secretary replied that he would be spending most of the month abroad, at the NATO meeting, the economic summit, then at Geneva, meeting Assad with the President, Tehran.6 After returning for his son’s college graduation May 19 he would go back again to CIEC and the OECD.7

Peacock noted that he himself would be going to CIEC. This would be a first for an Australian Foreign Minister. In the past the Treasurer had always attended, but this time the Prime Minister had weighed in on Peacock’s behalf.

What did the Minister think about Korea, asked the Secretary. Peacock noted that he had had a fairly thorough discussion on the subject with Phil Habib. Japan tended to cling to her hopes for rather long periods, yet it appeared that the US had finally just about convinced Japan before the Vice President’s trip there.8 Japan’s next concern was that the withdrawal from Korea not be precipitous. It could be assumed that Japan was prepared to accept the removal of US ground forces from Korea now provided there was proper monitoring of North Korean intentions and deployments. Australia had assumed that at some stage withdrawal from South Korea would occur. There was always a danger when one was asked to give “a” view; it was the cumulative effect that really mattered, Peacock continued. Aid to Viet-Nam, withdrawal from South Korea, the bogging down of Philippine base negotiations, the redeployment of naval vessels to Europe and [Page 759] the Mediterranean—taken all together these were causes for real apprehension.

What do you think about the Philippine base negotiations, asked the Secretary.

We hope that you make progress and are successful at a not too inflated price, said Peacock. It appeared, in fact Romulo had told the Minister late last year, that everything was going OK. But apparently Romulo was not keeping Marcos fully informed, and the agreement he thought he had reached with Secretary Kissinger proved to be only ad referendum, and unacceptable to Marcos.

What were US intentions with respect to China, asked Minister Peacock.

The US had merely said so far that its policies would be guided by the principles of the Shanghai Communique.9 This has helped indicate to the PRC the continuity of US policy. The US had just started some negotiations on claims and assets. The Secretary said he planned to travel to Peking in late summer or early fall.10 Dick Holbrooke and his group were putting together a strategic analysis. A major endeavor was to decide how the US should move along the road to normalcy. The security of Taiwan remained a major US domestic issue.

Australia had found that having a tangible presence in Peking was helpful, said Peacock, and more useful than talking from time to time with the Chinese Ambassador in Canberra. The Secretary said he had recently talked with the PRC Ambassador for an hour or so, and had explained to him what America’s main purpose was in his visiting Moscow. The Secretary had also undertaken to brief Huang upon return from Moscow.11

Mr. Holbrooke suggested that if Minister Peacock had good contacts with the PRC Ambassador in Canberra, it would be helpful if Peacock would talk to him from time to time and reassure him of US intentions. It would only be natural if the PRC had apprehensions concerning US contacts with Viet-Nam, the Soviet Union, etc. Minister Peacock noted that former Australian Ambassador to Peking, Gary Woodard, was also good value.

The Secretary said that the US was now in the process of deciding on its new representative to Peking, and would have made its decision within the next couple of weeks. This would be an important signal to [Page 760] the Chinese. The large majority of Americans, continued the Secretary, wanted to see normalization of our relations with the PRC. But at the same time they felt very deeply that the security of Taiwan must not be jeopardized.

Peacock said he would like to turn briefly to the Indian Ocean. He noted the President’s second (UN) speech put the US and Australian views on the Indian Ocean in close harmony. It was of course obvious that Berbera was not just a Somali air base.

The Secretary said he was sorry that the President’s first reference to the Indian Ocean had come out without anyone discussing it with Australia. President Carter felt that the USSR for a long time had been making a lot of propaganda points with nothing to back them up. He felt it was time to call their bluff, so he had taken that occasion, that is, the Indian Ocean occasion. The US would raise the issue in Moscow. If the Russians were really serious about their Indian Ocean statements the US would talk with them, but only in preliminary terms. The US expected, frankly, that they would say “get rid of Diego Garcia, since after all the USSR has no bases in the Indian Ocean area.” If they are really serious, however, the US would consult fully with Australia and with all other littoral countries directly involved. Again, said the Secretary, he regretted the way that Australia was caught up by the Indian Ocean issue.

Unfortunately, said Minister Peacock, it came after Australia’s particularly strong support for the US on Diego Garcia. The present Australian Government had, as a result, taken a serious pasting on this issue. This pasting had occurred not only editorially in the press, but also in Parliament.

The Secretary asked which in Australia’s view were the main areas in which consultation between us should take place at a very early stage. Peacock said that NATO, and the European region in general, should be considered major arenas. He noted that he was also concerned about Africa. The Secretary replied that it would be a good idea to talk about Africa during lunch.

Peacock noted that Africa had an important domestic aspect for Australia. There were strong feelings about absorbing “20,000 fascists” from Rhodesia into Australia, should the need arise. But Peacock added he was more concerned about the total impact. It meant control and influence in Africa by the USSR. Australia had taken a strong stand on racial issues, as strong or perhaps stronger than any other nation within the Commonwealth. He feared, added Peacock, that the impact of the Southern Africa question could burst the Commonwealth wide open, which he personally thought would be a pity since the Commonwealth had unused potential for good. Turning back to the Pacific area, he said he could not get it clear in his mind exactly the sort of role [Page 761] that US military and non-military aid programs would be expected to play in the region. It appeared to him that there would be real problems with the US Congress in this regard.

The Secretary confirmed that there would be real problems over Indonesia and the human rights issue. That was true also with Thailand.

Minister Peacock noted that they had covered together the cumulative effects on security in Southeast Asia. He could not see a great role there for US defense, in the military sense. Thailand was very weak; Malaysia had a longterm problem in its communal attitudes; and Australia really had no adequate reading on Cambodia. Australia could not see very far beyond the Suharto election in Indonesia, although they expected that Suharto would be returned. But what would happen there when Suharto finally went was uncertain.

Mr. Holbrooke asked the Minister for his views on the Mindanao rebellion in the Philippines. The Minister replied that here again he could not get an accurate reading. His own understanding, continued Holbrooke, was that the whole Philippines base negotiations were being deferred by Marcos until settlement of the South Philippines problem. That fact was healthy, he thought. The Philippine base agreement in any case did not expire until 1991. While we were not telling the Philippines that we were in no hurry, we were content to adhere to their deferred timetable.

Minister Peacock noted that the US seemed to be reconsidering the redeployment of its military forces. Australia would naturally be concerned with any shift, say, to the NATO area of the Pacific forces. Mr. Holbrooke hoped that the Minister was not saying that any shift at all would be destabilizing. That was not what he meant, answered Peacock, but it was the coupling effect he feared.

The Secretary noted that what changes, how and when they were made in force deployments were all terribly important.

Peacock said he apologized for raising the question of US aid to the South Pacific, which he realized was primarily an Australian-New Zealand area of responsibility, but he felt he could not leave Washington without alerting the US to the importance of being seen to take some action in this area. It was not a question of the US providing vast amounts of aid; he realized we had in mind an amount of $2–3 million, although he would have preferred a somewhat larger sum. Australia had earmarked $60 million over the next three years, in addition to other Australian aid to Papua New Guinea and Indonesia. There was certainly an element of blackmail when the small island states used Russian aid offers to procure US aid. But Australia felt the situation should in any case be watched very closely. The Prime Minister of Western Samoa, Efi, was no radical, but he was developing a Samoan entity. After he had invited the Chinese into Samoa, they rushed in in [Page 762] large numbers to set up their diplomatic mission. Efi had now learned that a receiving state could set the size of another country’s diplomatic mission. When the USSR got around to setting up a diplomatic mission in Apia, Efi had undertaken to slip Australia the names for whom the USSR wanted visa clearances. In turn Australia would pass the names sub rosa to the US for a security check. He felt, said Peacock, that if the Soviets got firmly established in the small Pacific island states the consequences within a decade could be serious.

The Secretary asked if Australia followed Micronesian events closely. Peacock answered that there was not really much interest among the public at large, but the Australian Department of Foreign Affairs followed the subject closely.

The Secretary noted that the US was now trying to get a firm handle on the situation which had gone on too aimlessly for too many years. Responsibility for Micronesian negotiations had been fragmented between the Navy, Interior and State. In the future the US would be following an integrated approach. It had been a very difficult period for the Micronesians; the primary negotiating focus would now, however, be in State.

Was the Palau superport issue of any major interest in Australia, Mr. Holbrooke asked. It was not, answered Peacock.

The Secretary noted that North Korea had recently made overtures about having talks with the US. We had made it very clear that we would not talk with them unless South Korea was also present. There had been some confusion in Japanese news stories over this subject, but the US hoped that it was straightened out now. Did Australia have relations with North Korea?

Formally, said Peacock, Australia had diplomatic relations, but had no mission now in Pyongyang, nor a North Korean mission in Canberra. The North Koreans had very recently put out a few feelers to re-establish mutual presences. A North Korean party wanted to visit Australia. The Minister himself would not receive this party, and it would be handled through a “friendship association.” Mr. Holbrooke asked Peacock about the Pine Gap agreement.12 Peacock said that had been covered in discussions with the Vice President. Presently Pine Gap was being operated on a twelve months denunciation clause, and he knew the US was reassessing its position. The Secretary noted that our judgment was to leave the agreement the way it stands. Mr. Holbrooke asked if the opposition party would make trouble over the [Page 763] issue. Peacock thought not. While some in the opposition did not really understand the matter, those in the know had not caused any difficulties and had not divulged information about the installation.

(At this point the meeting was ended in the Secretary’s office, and the participants, with additional persons, moved in to a working lunch).

The Secretary said it would be useful to talk about Zaire. Zaire was a rich state in its own right particularly in its potential. But the present situation in Zaire was somewhat cloudy. The US did not have its own information sources in Zaire, and had to rely on local sources. A lot of the information the US had received had proved to be wrong. It was very clear that former Katanga gendarmes were in the country and were supported logistically out of Angola. Whether Cubans were involved directly in the fighting or only in training and support roles was unknown. What was certain was that Zaire’s troops were terrible fighters. The situation was very unstable. The US was supplying Zaire with non-lethal assistance. The Nigerians were playing a very helpful role.

Admiral Turner said he had little to add. Neto might possibly back off if guerrilla actions mounted from Zaire against Angola were curtailed.

The Secretary said that the US had talked to the Soviets through their Ambassador in Washington. We told Dobrynin that the Soviets would be expected to exercise restraint. If they did not, it was bound to affect bilateral US-Soviet relations. The Secretary added that he would raise the issue again during his Moscow trip.

Ambassador Renouf noted that Zambia’s Kenneth Kaunda seemed to be worried about the Zaire situation, and particularly the fact that the radical belt was increasing in size in Africa. He asked if the Chinese were being slow to respond to African events.

The Secretary confirmed that the PRC was in fact only wringing its hands, and doing very little else. Mr. Habib noted that the Chinese could provide arms if they wished, and they had a capacity to do small things in East Africa.

Minister Peacock asked the Secretary for his thoughts on law of the sea (LOS) matters. The Secretary noted that he had talked with Eliot Richardson just before the latter’s departure on a Far East trip. The Secretary realized that Richardson would not be visiting Australia this time, and asked if Peacock had any thoughts on LOS.

Peacock said that much depended on the US and the political will that the US could generate. He had been advised that Richardson was not as pessimistic as those in the previous administration seized with LOS matters. Richardson did not feel that the issues must be settled “by May or else”. Australia’s expert Lauterpach would stay in close [Page 764] contact with Richardson, and was totally up to date on all aspects of LOS.

Minister Peacock asked how the Secretary expected the CIEC meeting in Paris to go. The Secretary replied that we must come up with concrete proposals enough not to end up in a bloody confrontation between the LDC’s and DC’s. The US had been working with the EEC on suggestions, also in preparation for the economic summit. The Secretary hoped by the middle of April to have concrete proposals which were both practical and from a political standpoint acceptable to the LDC’s.

The Secretary said that within the next two weeks President Carter would announce that the US unilaterally would forego any reprocessing capacity in the US. This came as a result of a study under way since January. It should have major repercussions when the announcement was made. The President had finally decided to take this step only last night.13

Peacock asked if he could inform Prime Minister Fraser in strictest secrecy. The Secretary said he could inform Fraser, and noted that Australia was the first country to be informed of this step. Peacock expressed his thanks for that fact and for the information.

  1. Source: Department of State, Office of the Secretariat Staff, Records of Cyrus Vance, 1977–1980, Lot 84D241, Exdis 1977 Memoranda of Conversation for Secretary Vance. Secret; Sensitive; Limdis. Drafted by Squire (EA/ANP) on March 28. The meeting took place in the Secretary’s office.
  2. The ANZUS Council met in Wellington July 27–28. Christopher’s report to Vance is in telegram 3151 from Wellington, July 28. (National Archives, RG 59, Central Foreign Policy File, D770270–0240)
  3. The meeting took place on June 22. See Documents 237 and 238.
  4. For the text of Carter’s UN speech, delivered on March 17, see Public Papers: Carter, 1977, Book I, pp. 444–451.
  5. The CIEC met in Paris May 28–June 2.
  6. References are to the NATO Ministerial meeting May 10–11, the G–7 Economic Summit May 7–8, the meeting between Assad and Carter in Geneva May 9, and the CENTO Ministerial meeting in Tehran May 12–15.
  7. The OECD Ministerial meeting in Paris June 22–24.
  8. January 30–February 1.
  9. For the text of the Shanghai Communiqué, which laid the groundwork for normalization of U.S.-Chinese relations, see Public Papers: Nixon, 1972, pp. 376–379.
  10. August 20–26. See Foreign Relations, 1977–1980, vol. XIII, China, Documents 4752.
  11. Vance was in Moscow March 27–30. See Foreign Relations, 1977–1980, vol. VI, Soviet Union, Documents 1722.
  12. Pine Gap was a joint U.S.-Australian defense space research facility. The agreement was signed on December 9, 1966, and extended on October 17, 1977. (29 UST 2759; TIAS 8969)
  13. For Carter’s April 7 nuclear power policy statement, see Public Papers: Carter, 1977, Book I, p. 581–588.