45. Memorandum of Conversation1 2
Subject:
- Meeting on Committee
Participants:
- NORWAY
- Ambassador Helge Vindenes
- SRI LANKA
- Ambassador Christopher Pinto
- PERU
- Mr. Alvaro de Soto
- UNITED STATES
- The Secretary
- Ambassador Learson
- Senator Pell Mr. Oxman
- Mr. Parsky, Treasury
- Mr. Eskin (Notetaker)
- Mr. Katz
The Secretary: I appreciate the opportunity to follow up on our discussions of yesterday. The problem is that the issues in Committee I are looked at from different perspectives. The developed countries have one perspective. From their point of view, it looks like the developed countries are making concessions. When you look at the issues from the point of view of the LDC’s, they think they are making some great concessions.
To us, it looks as though we are in a position to proceed unilaterally and legally to mine the deep seabeds. We are limiting voluntarily our own freedom of action. We are willing to promote an international regime. We have offered to help finance the Enterprise, have a review clause after 25 years and transfer technology.
[Page 2]The industry will not get started before 1989, and it will take 15 years or so to determine the commercial feasibility of deep seabed mining. Financing a mine site will cost between $400 -700,000,000; probably closer to $700,000,000. Since the commercial feasibility will have to be proven and this will take 15 years, that would leave only ten years before the treaty was due for review.
If there is no treaty, we will proceed unilaterally. Then only the US and some other countries, such as the FRG and Japan will enter seabed mining.
We are concerned with getting an agreement, not because we would be unable to mine, but because we want to help establish an international agreement. We are doing this because we are concerned that we have a unique opportunity to reach agreement.
Some of the extremist proposals which have been made in Committee I are in never-never-land.
Automaticity may be a poor choice of word. What we are seeking is objective criteria that negotiations can be based on.
In Washington, many think we are giving away much too much; Ambassador Learson is universally distrusted in Washington, although not by me, as being too conciliatory.
Some believe in Washington that if we can settle the issues in Committee II and III, then the hell with Committee I and the US should go ahead unilaterally.
Don’t take for granted that more concessions can be squeezed out of us. My nightmare is that Congress will decide to go ahead on its own.
Senator Pell: There is no question that deep sea legislation will go through at the next session of Congress, although not necessarily next spring.
The Secretary: Remember that it was the Democratic Party that pushed through the 200-mile bill. I don’t believe that Mr. Carter’s policies are very different on these issues. He has the liberals on his side. The pressure on him is from the right wing of the Party.
Senator Pell: My concern is that the Democratic Party may be pushed into taking a more arbitrary position.
[Page 3]The Secretary: Even tactically, Carter must win over the business community. He cannot start with a policy which will upset them.
Mr. de Soto: I don’t know the calendar on which you based your projections for deep sea mining.
The Secretary: The calendar is based on when our companies can start mining. They can’t begin before 1987 and it will take years to determine the feasibility of the mining operations.
I want to prove to you that the US can’t scoop up all the nodules in that period.
Mr. de Soto: All countries agree on the common heritage of mankind. The LDC’s believe that the international area must be jointly managed.
The Secretary: We agree with that view.
Mr. de Soto: Then it is not in your area; you’re not seeking sovereignty.
The Secretary: In the absence of agreement, there is no international law to prevent the US from mining the seabed.
Mr. de Soto: You have a commitment to strive for agreement; this is a political issue for you.
You said that there was no business interest in setting up the Enterprise. It might take the edge off the unilateral threat if we perceive your interest in obtaining international guarantee on access. It will show that you are willing to pay a high price to have an international regime.
The Secretary: That is correct. An international guarantee scheme is preferable. Further, it would contribute to the kind of world we want to see.
The LDC’s will not be giving up any advantage because when deep sea mining becomes feasible, it would be time for the treaty to be reviewed.
Ambassador Vindenes: As for Norway, our main purpose is to do what little we can to promote a compromise on the deep seabed issues. Our preference would be along the lines suggested by the group of 77. However, we are flexible.
[Page 4]There is no question about the problem of the political facts of life. You must be aware, on your side, of the problems of the facts of life in the Group of 77.
The Secretary: When you join OPEC, you will have a different point of view.
Ambassador Vindenes: We will never join OPEC. In fact, we want to promote an understanding between producer and consumer. That is a point of view not shared by some members of OPEC.
The difficulties in Committee I are serious. There are quite a number of members of Group of 77 who would prefer to stick to their positions rather than make any accommodations. Your policy must be to strengthen the hand of those who want accommodation.
The Secretary: That’s what we were trying to do yesterday.
Someone has given the example of a driver’s license. We can live with that. That makes the Authority the issuing organ for licenses.
If the Enterprise is brought in, it could contribute to the internationalization of the seabed.
Mr. de Soto: About the review mechanism, could this mean that any system could be a provisional mechanism?
The Secretary: There are various ways this could be done. I am most familiar with the kind of provisions found in the disarmament treaties. We have not formulated our position.
Mr. de Soto: Could you leave this question open?
The Secretary: I think it would be legitimate that anyone could seek to renegotiate any element of the Treaty. Our concern would be that existing operators not be subject to retroactive application.
Mr. de Soto: That is not unreasonable.
This would fit in with the dreams of many developing countries. After 25 years, an entirely new system could be adopted. For example, the resources could be exploited entirely by the Enterprise.
The Secretary: I have asked my delegation to look into the [Page 5] Nigerian proposal.
Mr. de Soto: The Nigerian proposal was discussed in Geneva and did not have much support.
The Secretary: I think that the Nigerian proposal might be helpful in financing the Enterprise. I do not exclude the possibility of joint ventures.
Mr. de Soto: I was not talking about the Nigerian proposal. Could you leave that decision open?
The Secretary: The big problem is does this mean that the arrangements last for 25 years or do they last until renegotiated, which would take place after 25 years? In the latter case, we would have a veto. These represent the two extreme positions.
Mr. de Soto: You have not thought it through yet?
The Secretary: We do not exclude that, after 25 years, we would go to a joint venture system. Some of our companies, in fact, could be tempted by a joint venture system.
Mr. de Soto: We know that.
The Secretary: Does it mean that we are making an agreement which will last only 25 years or a permanent agreement which will be renegotiated?
We do not yet have a government position on this. I can tell you the lineup of the agencies on the question.
Ambassador Vindenes: I would like to return to the three main questions. We recognize that on the question on the right to mine, the US cannot give in.
The Secretary: That is why I am speaking frankly.
Ambassador Vindenes: On Article 9 you will have to move.
The Secretary: In what direction? Is the percentage limit too high?
Mr. de Soto: Yes.
The Secretary: What other things?
Mr. de Soto: The review clause should apply to Article 9.
[Page 6]The Secretary: I have been informed that the Group of 77 would like the Article 9 to be in force only until commodity agreements have been agreed upon.
Mr. de Soto: That is what the Group of 77 would like.
The Secretary: Parsky turns green as soon as any mention is made of commodity agreements. It violates our orthodoxy. Possibly commodity agreements violate the order of the universe as well.
The first part is not unthinkable. We can examine this question on a case-by-case basis. We can agree to the first part. I don’t believe in a salami-tactic approach to negotiating.
Mr. Parsky: Is it your view that the percent is wrong?
The Secretary: If the percentage is too low, we have no access. If the access system is satisfactory, the other issues are negotiable.
Mr. Parsky: Will our kind of access system carry?
Ambassador Vindenes: I can’t say, but if Article 9 was revised, it would help.
The Secretary: I don’t think that we should be asked to make more concessions. On the other hand, it would be perfectly appropriate that the Group of 77 could propose an access system but at the same time ask to reopen negotiations on other issues.
Mr. Parsky: The access is of critical importance. We can’t go anywhere until that is settled.
The Secretary: We can’t go to Congress without that issue being resolved. The image that Congress has is that we are constantly making concessions and they will think that the Group of 77 has ignored our proposals.
Mr. de Soto: Elements in Article 9 are worth studying. There are problems with details. I want to clarify the link with commodity agreements. The production limit is outrageously low. It would displace landbased producers.
The Secretary: I would recommend that production limits be discussed in a producer-consumer form. If the production limit is too low, it would force us into a producer-consumer agreement.
If you say that the limit is outrageous, we can consider this.
[Page 7]I do not preclude modifying the limit.
The only reason we have agreed to any limit is because there is no commodity agreement on nickel.
Mr. Parsky: Before you go on, you must solve the access question.
The Secretary: If the Group of 77 moves on access and makes it conditional on new discussions on the production limit, we can look at that. Although we might not be able to agree on a limit. As to the link to eventual commodity agreements, we could accept that if this does not force us into an agreement.
Mr. de Soto: Your proposals will be seen by the Group of 77 as an effort to gain access. That means that they will not be seen in a broader light.
A certain number of members of the Group of 77 will insist that the Authority must have total latitude.
There can be no response to these proposals overnight. Probably none at this session.
The Secretary: We are not trying to wrap it up this session. We can narrow differences in Committee II and III this session.
Mr. de Soto: Another serious issue is the composition and voting in the Council. We have a feeling of something pending.
The Secretary: We will circulate a working paper on this and seek your reactions.
Mr. de Soto: I would be dishonest if I did not make clear to you that the Group of 77 can’t agree to any proposals based on the systems of the late 40’s such as permanent seats, veto power and weighted voting—the kind of arrangements used at Bretton Woods and Yalta.
The Secretary: These objectives can be achieved in many ways. Many international organs employ voting systems based on a 2/3 majority.
Mr. de Soto: A 2/3 majority is fine.
The Secretary: 2/3 or 3/4.
Mr. de Soto: You can’t expect the Group of 77 to accept much [Page 8] beyond a 2/3 majority voting system and a requirement for negotiations among large blocks.
The Secretary: We will propose, and you will react.
I think that if the access problem is resolved, other issues can be taken care of. Of course, we may have differences. We cannot let a simple majority dictate. There must be some relation between economic contribution and the results. There can be a resolution once the access system is solved.
Ambassador Pinto: Your proposals will be very helpful. Our interest is that there be an international regime. It would be a mistake to separate these negotiations on the access system from the ideological question of a common heritage.
Your three proposals will be seen as an attempt to buy access, but you cannot buy ideology.
Would you consider a 25 year regime—the number of years is not important, it could be 30—during which there would be a certain degree of automaticity after which Article 22, as determined by the Group of 77, would come into existence. There would be a comprehensive chapter called a transitional regime for that period as well as a permanent regime in Article 22.
The Secretary: I don’t think that we can say now that we will accept Article 22 after 25 years. You could raise certain, elements in Article 22.
With due respect, we do not have to buy anything. We see ourselves as making a contribution to the common heritage of mankind. We are prepared to create an international institution. Royalties will be paid. Half of the area will be under the international institution. This is how the common heritage will operate. More extremist members at the Group of 77 have no way to implement their proposals.
We will be accused in Congress of wild do-goodism for the sake of some abstract principle. No one in Congress will see the US as having cleverly bought access.
Suppose there is no access. We will negotiate agreements with a few countries, to avoid naval clashes and then proceed to mine.
Senator Pell: We are being criticized in Congress now for not doing this.
[Page 9]The Secretary: There must be bipartisan support for any Treaty.
The Group of 77 is unhappy with the RSNT. All of our resource agencies think that the RSNT gives away too much.
Ambassador Pinto: If you can agree to the 25-year review, then the question is academic.
The Secretary: Everything will be easier if we can resolve the question of the dual access system.
Mr. de Soto: You should be aware that even if progress is great in Committees II and III, if you do not get agreement in Committee I on all elements, there will be no Treaty.
The Secretary: I am aware of that.
Mr. de Soto: It all hinges on how much you want a Treaty.
The Secretary: We are approaching the margin on how far we can go. This is the message I wanted to bring. We are at the limit of what the system can absorb.
Senator Pell: When the Secretary proposed that the US help finance the Enterprise, my hair stood on end. I had never heard this. We would have a tough fight in Congress to get agreement. They will see it as financing our competitors.
The Secretary: I understand your problems. However, the Conference should not end with the appearance of total confrontation. You can perceive our proposals as some of the extremists have suggested or you can perceive them as an effort by the US to make the common heritage meaningful.
I would like to see Committees II and III wrapped up and the differences in Committee I narrowed. We should give the impression of progress generally. Otherwise, it will be hard to keep unilateral action by States in check. I do not want to start the next session of the Conference where we are now. Let us come a little closer together.
Is there anything that needs to be said that we haven’t touched upon?
I understand that there are limits imposed by the Group of 77.
Mr. de Soto: It is unlikely that there will be any response or [Page 10] counterproposals to your proposal at this session. The dynamics of the negotiations don’t permit it.
The Secretary: There are many ways in which the tone of confrontation can be eased and still leave options open at the next session.
Ambassador Pinto: Please consider a response to the proposal that I made.
The Secretary: We do not have closed minds on the subject.
To the extent you can, please use your influence to encourage a different prospective in the Group of 77.