Foreign Relations, 1977–1980, Volume XXIII, Mexico, Cuba, and the Caribbean

165. Memorandum of Conversation¹

Washington, September 29, 1979, 10:15–11:30 a.m.

SUBJECT

• International Issues and Energy

PARTICIPANTS

• U.S.

  • The President
  • The Vice President
  • Secretary Vance
  • Secretary Duncan
  • Dr. Brzezinski
  • Mr. Eizenstat
  • Assistant Secretary Jules Katz
  • Assistant Secretary Viron Vakey
  • Robert Krueger, Amb at Large-Des.
  • Ambassador Patrick Lucey
  • Ambassador Henry Owen
  • Jerry Schecter, NSC Staff
  • Guy F. Erb, NSC Staff
  • Bob Pastor, NSC Staff
  • Everett Briggs, State

• Mexico

  • President Lopez Portillo
  • Jorge Castaneda, Secretary of Foreign Relations
  • Jorge de la Vega Dominguez, Secretary of Commerce
  • Jose Andres Oteyza, Secretary of Patrimony and Industrial Development
  • Alfonso de Rosenzweig Diaz, Under Secretary for Foreign Relations
  • Jorge Diaz Serrano, Director of PEMEX
  • General Miguel A. Godinez Bravo, Chief of Staff, Pres. Gen. Staff
  • Rafael Izquierdo, Advisor to the President
  • Jose Antonio Ugarte, Advisor to the President
  • Dr. Robert Casillas Hernandez, Private Secretary to the President
  • Rosa Luz Alegria, Under Secretary for National Planning and Budget
  • Andres Rozenthal Gutman, Director General of North American Affairs, Secretariat of Foreign Relations
  • Hugo Margain, Mexican Ambassador to the United States
  • Jose Ramon Lopez Portillo, Director of Analysis, Secretariat of Programing and Budget
  • Abel Garrido, Director of Bilateral Trade Relations, Ministry of Commerce

Saturday morning

President Carter said he had enjoyed the dinner and that the toasts and comments showed our publics that we are working well together. (C)

President Lopez Portillo agreed. He lamented the impression that had been given of the last meeting. The spirit had always been as it was today. He was very glad of that. (C)

President Carter said he had looked into Lopez Portillo’s U.N. speech and his proposal for a UN Working Group,² which he found to be promising. It would be advisable if the two Secretaries of State quietly kept each other informed on this matter. We would confine our public remarks to the joint positions that they reach. (C)

President Carter said that the United States would continue to support energy development in developing countries through the World Bank and bilateral programs. At the Tokyo Summit, we and others had resolved to limit to the maximum degree possible the future imports of oil. Actions which he had taken alone and with the Congress would reduce our otherwise likely imports by four million barrels a day by 1985. Additional measures now awaiting Congressional approval would reduce our demand for oil imports by another 4 million barrels a day by 1990. With your permission, Secretary Duncan would describe briefly the presentation that he made in Paris. (C)

Secretary Duncan described the Paris meeting of the seven Energy Ministers of the Summit countries.³ The meeting had opened with a determination that world oil supply and demand were in a fragile balance, but for several reasons there existed a possibility of supply interruptions. The situation seemed to be set for 1980, but that could be affected by economic changes or by political events or disruptions. In the medium and long term the fact that the system would continue to be fragile drove the need for conservation measures and constraints on imports. (C)

Duncan then discussed the measures that had been taken since the Summit to reduce reliance on oil imports. The main questions had been what the members of the European Community would agree to as their individual targets for 1979 and 1985. They had agreed to 472 million tons, approximately 9.5 million b/d, as the ceiling for EC members in 1980. The figure of 472 million tons compared favorably to EC imports in 1979, which were projected at 515 million tons. All nine EC countries had accepted the necessity of adopting national targets and the four Summit countries in the EC had already made national commitments. Japan had accepted a range but the Japanese Energy Minister had said at the meeting and at a press conference that he would try to achieve the lower end of the range, that is 6.3 million barrels per day. Secretary Duncan also mentioned the 1980 U.S. import commitment of 8.5 million b/d and the 1979 target of 8.2 million b/d a day. (C)

In Paris, Duncan said, they had also discussed a crude oil transaction register. It would record transactions in the crude oil market and make them public on a monthly basis. There was also a discussion of energy technology and how to communicate that technology. Improvements would be sought in the exploitation of coal, nuclear power, with an emphasis on safety, and alternative sources of fuel. Conservation was also emphasized. There had been considerable interest in the President’s energy program. With the President’s approval Secretary Duncan gave a fact sheet to Secretary Castaneda. (C)

President Carter thanked Secretary Duncan. To summarize, the President said, all of us realized that we had been using, wasting, and importing too much oil. All agreed that despite economic growth, imports would not increase through 1985 and then would be reduced through the use of alternate sources of energy. To help maintain stable supply and stable prices we were eager to share our technology with developing countries and provide or help provide finance for exploration. He understood that these goals were compatible with Lopez Portillo’s. (C)

President Lopez Portillo said yes, he was not saying anything new, only that there would be serious and grave consequences if there were no action. He believed that, put together, the Tokyo Summit ideas and President Carter’s energy programs were close to his U.N. proposals. But there were certain considerations that he would like to raise. The Tokyo Summit countries were trying to reduce their dependency by controlling demand. There were two problems with that approach. (C)

If bloc policies were followed, said Lopez Portillo, then the producers would cartelize supply; they would look for balance in the market and for an advantageous situation in the world economy. Therefore, reliance on blocs was ill advised. Bloc bargaining added great danger. During the period in which we try to control demand we run the risk of a recession because a cut in demand would reduce economic growth. A reduction in demand would cause OPEC to reduce supply and upward pressure on prices thus would continue. The position of developing-country oil importers would become even more serious. They would be cut by a scissors: the price of petroleum would rise while a recession affected their exports. This would be very unfavorable for the developing countries. (C)

That is why President Carter’s energy program for the U.S. was interesting. What you had proposed for the United States was close to what should be approved by the entire world. We could not act on isolated parts of the whole problem. For this reason we supported your plan. President Lopez Portillo had reservations about the Tokyo results but he hoped that reason would prevail and that energy would be taken up in a global forum. (C)

Lopez Portillo said that there were dangers of misunderstanding. An OPEC country had already said that Mexico’s proposal had been thought up as a means of dividing OPEC. He had foreseen that this would happen and for that reason had said that the United Nations is the place in which to raise the problem. Mexico’s position was separate from the producer and consumer positions. He believed, however, that it was the correct view. He viewed the Tokyo Declaration with sympathy, but it had the dangers to which he had referred. However, the Tokyo meeting indicated that there was a trend toward order which gave him hope that it would be possible to negotiate. (C)

President Carter said he recognized the concerns of Lopez Portillo. We were making every effort to avoid creating a recession. Our principal emphasis was on conservation and elimination of waste. Our second effort was to produce oil and gas more efficiently from existing fields and with advanced techniques for recovery. We wished to use other forms of energy which were plentiful; that is shale, coal and solar energy, as well as increase the ability of developing countries to find energy resources. We were eager to share our superior technology with all other nations and were making some progress. (C)

President Carter asked if they might pass to the Middle East. Lopez Portillo agreed. President Carter said he would persist in efforts to have a comprehensive peace, security for Israel, and recognition of the legitimate rights of Palestinians. Compared to a year ago, primarily because of the courage and foresight of President Sadat, we had made remarkable progress. Prime Minister Begin had also been courageous. He had a democratic society and must assuage different forces. Recognition was growing in our country and in Israel itself of the need to recognize the legitimate rights of the Palestinians. We were encouraged but the peace effort needed support of others with influence, like the leaders of Mexico. (C)

The accord signed at Camp David was a very good commitment to the Palestinian cause, to a comprehensive peace and to the security of Israel. It had become almost a Bible for the three countries. We would not deviate from that commitment. President Carter hoped that to the extent possible Lopez Portillo would give support to the document. Lopez Portillo said within the modesty of the Mexican position he would be happy to support it. He was totally in agreement with the principle that we must seek to resolve the Middle Eastern problem. He believed that the possibility of resolving it depended heavily on the Palestinian issue. President Carter agreed. President Lopez Portillo said that the problem could be solved. (C)

There were ancient, new forces at play, said Lopez Portillo. He hoped that what he was about to say would not be interpreted as the theories of a former political science professor. He feared that old forces had come into play. In Iran we saw the force of an old religion that we had not counted on. He had seen that and associated it with something else that had occurred in Mexico. At the same time that events in Iran showed the strength there of religious feeling, a surprising show of support for the Pope took place in Mexico. The backdrop to our deliberations was an age old question. The Middle East was the meeting point of three great religions, Islam, Judaism and Christianity. These religions had not yet resolved their differences. In the background of many problems that seem objective we found these old tensions that we had forgotten. This fact would influence all positions, even on energy. But he did not mean to be excessive; Mexico would make all efforts possible to point toward a solution of a problem that had lasted too long. (C)

President Carter raised SALT II. He considered the ratification of the SALT treaty to be the most important priority that he had. It was vital to the enhancement of the peace and security of our nation. It was difficult to obtain ratification of a treaty. It had been difficult in the case of Panama; only a narrow margin of support was obtained. (C)

There were some members of the Senate that didn’t want to cooperate with the Soviet Union. Others felt that SALT was not balanced and not in the U.S. interest. Others felt that we should not ratify it as long as the Soviet Union and Cuba were placing troops throughout Africa and in other countries. Still others believed that we should not ratify the SALT accords unless there were a substantial increase in defense expenditures. The sum total of opposing forces could not exceed one third of the Senate. The issue was complicated by the fact that we were entering a highly partisan election period. Even some former officials that had laid the basis for the SALT negotiations now had expressed doubts. The task was very difficult. (C)

President Carter said he was determined to do everything possible to have SALT ratified. He was dealing with public opposition and with individual members of the Senate. We had at this time a doubtful prospect. He would not be discouraged nor deterred, he said. Our NATO allies had been helpful, especially among those Senators that were committed to strong military forces and who feared the Soviet threat in Europe. He knew President Lopez Portillo’s sensitivity to interference in other nations’ political affairs, but within the bounds of non-intervention and propriety, he was asking for anything that Lopez Portillo could do with Senate members or public opinion. Lopez Portillo’s efforts would be useful, whatever contacts with high officials he thought were appropriate. Success or failure might depend on the vote of one U.S. Senator from a Southwestern state, who might be influenced by Mexico’s views or by Chicanos that would listen to Lopez Portillo’s voice. Lopez Portillo should use his own judgement. President Carter had wanted him to know that he was very determined. SALT was of great importance to our mutual objectives. (C)

Lopez Portillo said that it was a very important and very delicate matter. He was realistic; he knew that the positions of powerful countries were at stake. Concord between powerful countries meant peace and was important to bring about. He knew this peace could be negotiated and hoped President Carter would be successful. (C)

He must bring up some points, he said, he wouldn’t like to say what he could not repeat outside. Mexico was very much aware that strength is an important factor in world politics and that it was legitimate that the powers defend themselves. Mexico used principles to defend itself. That was why Mexico was so insistent in ratifying them. Mexico repeatedly stated the principle of non-intervention. Mexico was against foreign military activity in any country. That was Mexico’s position. It had not changed and never would. He hoped that this view was not troublesome, but for Mexico it was the same thing to have Soviet troops in Cuba as American troops in Cuba. The presence of troops was the protection of the interests of one or the other country. He understood the world. Cuba should be free of Soviet and American troops. (C)

Mexico didn’t want Soviet or American troops in Mexico. Mexicans didn’t want for others what they didn’t want for themselves. We didn’t want Soviet or Chinese troops in the United States. That is Mexico’s position. (C)

Within the framework of Mexico’s resolve he would do everything possible, within Mexico’s modest competence. He would appeal to the major powers that they should come to an understanding and that they should agree that mankind didn’t belong to the powers, but that the powers belonged to mankind. (C)

Any mistake by a super power could affect the world. Mexico was small but, nevertheless, a part of the world. Lopez Portillo hoped that the major powers could negotiate disarmament and peace and that there would be no further military interventions. President Carter said he agreed with those objectives completely. (C)

President Carter asked if there were any other themes to take up. President Lopez Portillo said that on Friday he had talked with Secretary Vance on Nicaragua and the risks in El Salvador. We would celebrate tomorrow in Panama an important decision.⁴ Did President Carter want to repeat matters of which he and Vance had spoken yesterday? President Lopez Portillo thought they had dealt with them extensively. President Carter agreed. Lopez Portillo said he would like to emphasize Nicaragua. Good, said President Carter. (C)

Lopez Portillo said that we were in a delicate stage in Nicaragua and in the destiny of all Latin America. If aid to Nicaragua were conditioned on steps toward a certain type of political system, we would be trying to bend the arm of self-determination in Nicaragua. We would substitute one political caricature for another. Mexico gave aid, and Mexico is helping to the extent possible, so that we could support free determination by Nicaraguans. We should give the Junta the elements necessary to guarantee a peaceful transition from Somoza to a system set up by Nicaraguans. (C)

If we insisted on conditions, we would repress the will of the Nicaraguan people. We would continue to commit the errors of the past. The Nicaraguan people would never come of age. (C)

Mexico is helping in what it could. Mexico had offered oil, but the refinery in Nicaragua belonged to Esso. Mexico’s decision depended on what Nicaragua decided to do with the refinery. If a political position were taken by the radicals, they would try to nationalize the refinery. Mexico had been confronted with this problem after it had made the offer of oil. If we could find some kind of interpretation that would allow oil to be refined in Nicaragua, without anything happening to or in the refinery, we could help. He understood that there were temptations to nationalize the refinery. (C)

We must permit a transition period to democracy. There were daily problems: food, medicine, and clothing; and short-term problems: the restoration of agriculture and small industry. Mexico would help in every way it could, particularly in energy. The Nicaraguans had to learn how to handle their finances and trade. If we drew Nicaragua down by reducing the prices of their raw materials we would have a problem like that of Sisyphus. We didn’t want Sisyphus in Nicaragua, but “None-of-us.” (Laughter) (C)

President Carter said the United States was providing aid to Nicaragua. He had a constructive meeting earlier in the week with individuals in the Junta.⁵ He had offered aid to agriculture, industry, and for electrical systems. The United States would be very supportive of the new government. (C)

President Carter said he had told the members of the Junta that if they would not hold him responsible for the past actions of U.S. Administrations, he would not hold them responsible for past actions of Somoza. Bravo, said Lopez Portillo. (C)

Lopez Portillo said that Nicaragua was of interest to a variety of political trends. Everyone wanted to find an example there. President Carter agreed. Lopez Portillo said that it would be an error to try to put conditions on their actions. What we wanted to see in Nicaragua was what we wanted to see in the bull ring: The spectators say when too many helpers crowd around a bull fighter, “Leave him alone.” (C)

President Carter asked Secretary Duncan to look into the Esso issue. Secretary Duncan said that it appeared to be a Nicaraguan decision but that he would look into it. Lopez Portillo said that he maintained the offer of 15,000 b/d, without price speculation and, indeed, with special consideration for their problem. If the United States could help resolve the refinery issue, Nicaragua’s energy problem could be resolved. (C)

President Lopez Portillo said that he and Secretary Vance had dealt with the other matters and it was unnecessary to repeat what he had said to the Secretary. (C)

President Carter said the only other matter was a sensitive one. He thought it would be a mistake to bring up the oil spill and river salinity too directly,⁶ but we should have some means of discussing environmental issues without that discussion being considered a reflection on what has happened before. It would be useful to have an agreement to discuss environmental issues without seeming critical of each other. What was Lopez Portillo’s view? Should we use the Consultative Mechanism? Our objective would not be to levy damages, but to minimize damages if we had a problem in the future. (C)

Lopez Portillo (showing some surprise) said that personally he was with President Carter. The framework for such issues was now given by international law in all its possibilities. It was the system that makes it possible to put one’s rights forward. Mexico had a right to claim damages with regard to salinity in the Mexicali Valley. The United States had a right to claim damages in the case of the Campeche Bay spill as well, but such rights were not yet set in international law. (C)

Lopez Portillo said that there had been great indignation in Mexico because there had been no opportunity to put forward claims on the United States with regard to the Mexicali Valley. Lopez Portillo said that before things happen, let us establish legal rights. We could come to agreement to avoid damages and even to redress and offer indemnity when things happen. That was friendship. We should turn right and reason into law. He quoted a Mexican saying: clear accounts maintain friendship. He was now instructing Secretary Castaneda to establish an institutional system, which would allow us to protect, conserve, and remunerate for environmental damage. (C)

Mexico wanted these affairs put forward legally by the United States. He cited another Mexican saying: everyone should have either long tails or short tails. That was democracy. He shared President Carter’s idea. (C)

President Carter said that if a problem arises, for example, salt in a river or an immediate problem like the oil spill, we should have a mechanism to deal with the problem jointly without dispute. Lopez Portillo retorted that would be all right if the mechanism were included in a legal agreement. We must make haste in reaching an agreement said Lopez Portillo. All right, said President Carter. (C)

The meeting closed at 11:30 a.m.⁷

1. Source: Carter Library, National Security Affairs, Staff Material, North/South, Pastor, Country, Box 30, Mexico, 9/12/1979. Confidential. Drafted by Erb on October 3. The meeting was held in the Cabinet Room.
2. See footnotes 2 and 15, Document 164.
3. Duncan met with European and Japanese Energy Ministers in late September.
4. U.S. sovereignty of the Panama Canal Zone ended on September 30.
5. Documentation on this meeting is in Foreign Relations, 1977–1980, vol. XV, Central America.
6. In June 1979, a PEMEX-owned oil well suffered a blowout, leading to a large spill in the Gulf of Mexico. Beginning in the 1960s, pollution in the Colorado River led to increased salinity of the water in the Mexicali Valley.
7. For the joint press statement issued at the end of Lopez Portillo’s visit, see Public Papers: Carter, 1979, Book II, pp. 1789–1791.