59. Memorandum From Douglas McMinn of the National Security Council Staff to the President’s Assistant for National Security Affairs (Clark)1
- U.S.-Soviet Negotiations on a New Long-Term Grain Agreement (LTA)
The initial round of negotiations for a new LTA (June 2, in London) was constructive and non-polemical. While major differences remain on several issues, the Soviets made clear their readiness and desire to conclude a new LTA soon. There was joint agreement to use the existing LTA framework as the basis for negotiations.
With regard to the next round of negotiations, to be held in Moscow June 20–21, the Soviets hinted they would like this to be a major negotiation session with the signing of an agreement some time shortly thereafter. It is open to question whether such an optimistic timetable is possible. The Soviets also made known their desire that a Cabinet-level official sign the agreement and they would like the signing ceremony in Moscow. Our negotiators told the Soviets that no decision had been made on who might sign for the U.S. and where.
Based on the June 2 discussions, the major substantive differences between the Soviets and ourselves are as follows:
Minimum Purchase Levels
Whereas the present agreement has a range of 6–8 million tons for the minimum and maximum purchase levels, the Soviets suggested a range of 6–12 million tons with delivery assurances not only on those amounts, but also on additional amounts offered during regular bilateral consultations (in effect on all Soviet purchases of U.S. grain). The Soviets also want separate USG assurances to intervene in case of longshoremen boycotts, strikes, etc. The U.S. side countered with a minimum purchase range of 16–19 million tons, which the Soviets rejected; the U.S. indicated we were willing to consider a lower number. The U.S. side “hung tough” on the supply assurances issue and offered no more than current Article 2 delivery assurances.[Page 188]
The Soviets reacted negatively to the U.S. proposal that the short supply trigger (permitting the U.S. to reduce deliveries if our crop situation dictated) be raised from 225 million tons to 280. The Soviets want to delete this provision altogether, arguing it makes the LTA imbalanced because it gives the U.S. an “out” whereas the Soviets do not have one.
The Soviets argued for inclusion of a provision that the USG would guarantee quality levels set in contracts and that the Soviets would be relieved of their purchase obligations if grain were not up to particular quality standards. The U.S. side suggested it would explore a “good offices provision” by the USG, but strongly rejected the notion of a Soviet escape clause from its minimum purchase obligations.
The Soviets argued for negotiation of a new maritime agreement, even though acknowledging that shipments were proceeding smoothly now in the absence of a maritime agreement. They indicated that at a minimum, retention of Article 7 of the present agreement was essential. (We have no problem with retaining Article 7, which merely stipulates that grain shipments be conducted in accord with the maritime agreement in effect at the time, but the U.S. delegation simply noted we were not authorized to negotiate a new maritime agreement).
** In private discussions with our chief negotiators this week, I reaffirmed the President’s position that he favors mutually beneficial trade with the Soviets, on the basis of regular commercial considerations, i.e., no “special deals.” I emphasized that major additional guarantees to the Soviets on supply assurance (over and above those in the existing agreement) would run counter to the President’s position.
- Source: Reagan Library, Executive Secretariat, NSC Country File, Europe and Soviet Union, USSR (06/09/83). Secret; Sensitive. Sent for information. A copy was sent to Bailey. Clark’s stamp appears on the memorandum, indicating he saw it.↩