Foreign Relations of the United States, 1969–1976, Volume VII, Vietnam, July 1970–January 1972

286. Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to the Under Secretary of State for Political Affairs (Johnson) and the Deputy Secretary of Defense (Packard)¹

Washington, January 3, 1972.

SUBJECT

• Economic Support for Vietnam

It is important to evaluate the economic support required by the South Vietnamese economy over the coming years, as well as the alternative ways of meeting that requirement.

The first phase of this study should focus on how the essential level of foreign exchange support can be provided during CY 1972 and should include examination of:

• —The foreign exchange support required by Vietnam in 1972;
• —The potential sources of this support, including: (1) means of reducing the AID project to free supporting assistance funds for imports, (2) potential DOD actions to slow the reduction in foreign exchange availability, and (3) ways to keep up the level of PL–480 support despite rice self-sufficiency;
• —The legislative problems, requirements for Presidential or other determination, and budget limitations.

The second phase should examine probable economic requirements from 1973 through 1976 based on alternative assumptions regarding the rate of economic growth, the level of military activity, and other key variables. Support from DOD, PL–480, and AID should be projected with policy alternatives clearly identified.

Actions to increase foreign exchange availabilities should not be delayed pending completion of the study.

The study shall be prepared under the direction of the Vietnam Special Studies Working Group. The first phase should be completed by January 19, 1972, and the second phase by mid-February 1972.²

Henry A. Kissinger

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 158, Vietnam Country Files, Vietnam, Jan–Feb 72. Secret. Odeen forwarded the memorandum to Kissinger under a December 22 covering memorandum which indicated that he had redrafted it to ask for both a near and long term study. Copies were sent to the Director of Central Intelligence, the Chairman of the Joint Chiefs of Staff, the Director of the Office of Management and Budget, the Chairman of the Council of Economic Advisors, the Administrator of the Agency for International Development, the Assistant Secretary of the Treasury for International Affairs, and the Assistant Secretary of Agriculture for International Affairs.
2. The Vietnam Special Studies Group completed the study and submitted it to the President by February 17. The President’s decision and implementing instructions are in National Security Decision Memorandum 154. See Foreign Relations, 1969–1976, volume VIII, Vietnam, January 20–October 7, 1971, Document 29.