108. Memorandum from Director of Central Intelligence Colby to the President’s Assistant for National Security Affairs (Kissinger)1
SUBJECT
- Study Report on US-Saudi Joint Cooperation
1. As a member of the ad hoc Special Committee established by NSSM 198 to supervise the drafting of an “initial study” concerning joint US-Saudi cooperation, I have reviewed the report on this subject produced by the Interdepartmental Group chaired by Under Secretary Sisco. My comments follow.
2. The study report submitted by the Interdepartmental Working Group appears to be an essentially sound approach to intensifying our overall relationship with Saudi Arabia. Its objectives, however, will not be easy to achieve and there will be many difficult problems ahead.
3. The following would appear to be the major substantive problem areas:
a. The concept of simultaneously intensifying bilateral relationships with Saudi Arabia, Iran and Egypt and encouraging them, at the same time, to solidify their own triangular relationships is certainly sound. A working coalition between these key regional states and the US could stabilize the Middle East political and economic situation and is also consistent with Israel’s interests. An ever-present danger is that, because each of the regional states harbors suspicions and jealousies of the other two, [Page 384] an aggressive individual US bilateral approach could jeopardize attainment of the final multilateral goal of regional stability. Thus, it is important, for instance, that our actions not be interpreted as an attempt to split off Saudi Arabia from the other Arab states. Likewise, our initiatives with Iran must be construed in a way that will create confidence in the Arab countries that we are seeking regional stability and not building up Iran to dominate the Arabs. And finally, of course, the Cairo relationship must not weaken the still fragile Cairo-Riyadh axis around which the mainstream of major Arab policies is beginning to develop.
b. There are already some indications that Saudi expectations about the fruits of the new cooperative relationship may create some problems. In the security area, for instance, the Saudis appear to be focussed primarily on military supply rather than a broader dialogue aimed at first developing a shared conceptual outlook to identify on a rational basis the points where our national security interests coincide, and followed by efforts to develop specific integrated policies. Likewise, in the economic field the Saudis may be interested in some large investments causing problems to the US. These, of course, are natural start-up problems in an exercise like this, but we will need to be attentive to them.
c. A related problem is that the Saudi bureaucracy and top-level decision-making apparatus is already suffering acute indigestion from the flood of ideas, proposals and plans that they are being forced to evaluate. At best we can expect that our new initiatives will strain to their limits the very thin crust of competent Saudi technocrats and civil servants and in some areas they are likely to be overwhelmed. Added to this is the fact that the Saudis are not attuned to doing business in a systematic and bureaucratically formalized way and may, therefore, have considerable trouble adjusting to the joint commission-working group approach. Thus the success of the exercise will depend in part on the patience and sympathy with which it is implemented.
d. Our initiatives will have substantial impact on the Saudi Arabian internal political scene. The Saudis have interpreted even our opening gestures as being an offer by the most powerful and technologically advanced society in the world to be an equal partner in tackling some of their most difficult political and economic problems. The idea makes them a bit dizzy. Moreover, because of the importance they attach to this development, it is setting in motion significant forces within the Saudi power structure. Prince Fahd’s hand, for example, has been strengthened and a struggle is on within the inner circle for inclusion in Fahd’s Washington trip team. Those chosen will be regarded as having won the first important round in a contest among the present Faysal team to see who will be tabbed to carry over and play big roles [Page 385] under the next generation of leadership. This points up the importance of noting the impact which our plans will have on the Saudi domestic political scene.
e. In the economic field a key element will be how our efforts are tuned to Saudi preferences for ways of doing business. The middleman/commission agent is a well developed institution in the Middle East who cannot be eliminated from business transactions simply on the grounds that they may be making some money in ways that strict Western definition might regard as “corrupt.” The primary criteria for these and related activities is their effectiveness in promoting US business interests and their acceptability to the Saudis. Otherwise the paternalistic role of defining for the Saudis, without their agreement, what is “right” and “wrong” would cause difficulty. These “middlemen” may act as promoters of US business or, if opposed, have a certain capacity to sabotage our efforts in both the trade and investment fields.
f. The relatively mild European reaction to our opening moves toward greater cooperation with Saudi Arabia may be misleading. A combination of preoccupation with other developments—Pompidou’s death, and EC problems, for instance—and adroit US diplomacy no doubt took some of the sting out of the initial European reaction. Once, however, the full extent of our plans becomes known, there could be a higher European price to pay in terms of future European attitudes when the issue of bilateralism versus multilateralism comes up again. The closest possible continuing consultation with the Europeans can help offset this kind of reaction but not entirely dispel it.
4. On the procedural side, the following comments are offered:
a. [1 paragraph (14 lines) not declassified]
b. The intelligence community can also make analytical contributions to other joint commissions. It may in fact be worth considering the participation of the National Intelligence Officer for Economic Affairs in the annual deliberations of the Economic Commission. At the working group level, the economic expertise of CIA’s Office of Economic Research should be of considerable value. Several steps have already been taken to tune our collection and analytical efforts to the requirements generated by this new approach to Saudi Arabia.
c. The structural pattern of setting up joint working groups to operate in the period between annual sessions of the joint commissions may not be feasible in all cases. Qualified Saudi personnel who can do business this way will not be available in many cases; we will have to be prepared to share most of the burden in between annual sessions. Setting up one high level US official to coordinate and oversee our contributions is wise and necessary to avoid bureaucratic confusion.
d. [1 paragraph (7 lines) not declassified]
Summary: Colby provided comments on NSSM 198 and the potential problems of a substantially widened U.S.-Saudi relationship.
Source: Washington National Records Center, OASD Files: FRC 330–78–0011, Saudi Arabia 1974. Secret; [handling restriction not declassified]. Hoskinson forwarded the memorandum to Schlesinger under an April 25 covering memorandum, on which Wickham wrote: “Suggest show to Mr. Clements.” A note on the memorandum reads: “Sec Def has seen.” NSSM 198 is Document 18.
↩