112. Telegram From the Embassy in Algeria to the Department of State1
288.
Algiers, March 16, 1982, 1620Z
For Deputy Secretary Stoessel from Newlin. Subject: The Future of US-Algerian Relations—The Lockheed Project.
- 1.
- (S) Entire text.
- 2.
- Negotiations between Lockheed and Algeria on a far-reaching package of aircraft, technical studies, constructions and training/maintenance have reached the point where Lockheed chairman Roy A. Anderson paid a 3-day visit to Algiers for in-depth discussions with senior Algerian officials and Embassy.
- 3.
- On March 13 Algerian Air Force Chief Abdelli sketched Algeria’s needs, the most urgent of which are approval of eight additional C–130 [Page 252] aircraft and FMS training. Abdelli officially requested me to obtain an early reply to Algeria’s requests in this area, particularly training.
- 4.
- Abdelli reiterated that Algeria had given firm end-use assurances concerning the C–130’s. Moreover, Algeria was a huge country whose development needs were as urgent as they were enormous. Algeria, he stressed, had no expansionist aims whatsoever.
- 5.
- He then went on to state Algeria’s intention to buy a wide-bodies aircraft for presidential use and additional similar aircraft for Air Algerie, as well as technical training and maintenance facilities for its aircraft fleet. As a developing country, Abdelli said Algeria could not afford separate civilian and military maintenance infrastructures.
- 6.
- The Algerian Air Force chief mentioned that financing would be an important consideration. He also stated that the USSR, France, the UK and the FRG were all interested in obtaining the contract for this large program, details of which are reported septel.2
- 7.
- Comments and recommendations:
- (a)
- Having been given end-use assurances, which Algeria is scrupulously respecting, I believe we should promptly approve the request for the pending C–130’s.
- (b)
- Logically, we should also approve the USG training which requires a presidential determination to make Algeria eligible for FMS. Algeria considers it has purchased U.S. military equipment which it is currently unable to use for the purpose for which it was bought because of the lack of desired USG-supplied training. (Abdelli rather bitterly referred to the fact that C–130’s were currently being used to import eggs.)
- (c)
- If, despite logic, we are currently unable to provide the kind of training Algeria so strongly desires, I believe I should be authorized to tell Abdelli frankly the reasons therefore. I hope that pouring cold water on a request that the Algerian military looks on as a test of American good faith will not materially damage Lockheed’s chances for the overall package being discussed, but I cannot be certain.
- 8.
- I do not need to underline the potentially fundamental political implications of this project. The largest, richest and most stable North African country is considering entering into a long-term relationship with a major American company which will ultimately end its military dependence on the Soviet Union in a key area. In addition, the economic benefits are considerable. Lockheed has been cautious in this department, but chairman Anderson told me the additional modules for wide-bodied aircraft, spares, training and maintenance facilities would [Page 253] amount to dols. 600 million and the entire package could eventually cost upwards of dols. 2 billion.
- 9.
- Anderson may raise some of these issues at the dinner hosted by Ambassador Malek March 19 which Anderson understands you are also attending. You should be aware that the Algerians have asked us specifically not to mention the planned purchase of a presidential aircraft to Ambassador Malek, even though Malek is aware at least in general terms of the other aspects of the proposed cooperation. As best we know, the only decisions of a military nature that need to be taken now relate to the additional C–130’s and the FMS training. Lockheed will soon begin an exhaustive in-country study of the other components of the package. A decision to assist with maintenance of non-U.S. built military aircraft may not be required until several years from now.
Newlin