Foreign Relations of the United States, 1969–1976, Volume E–11, Part 2, Documents on South America, 1973–1976

118. Action Memorandum From the Director of the Bureau of Politico-Military Affairs (Vest) to Secretary of State Kissinger¹

Washington, July 8, 1975.

FRG Nuclear Sale to Brazil

The Problem

Recent statements by FRG Chancellor Schmidt and Brazilian Foreign Minister Silveira, if accurately reported by the press, portray you as concurring with, or having no objections to, the FRG/Brazil nuclear assistance agreement. While we do not wish to encourage further controversy over this matter, we believe it is important to set the record straight since uncorrected distortions of the US position making it appear that we approved the sale could adversely affect our position in the nuclear supplier talks and arouse further public and Congressional concern. In order to clarify our position on the sale, we believe that it would be desirable to remind appropriate FRG and GOB officials that while we wish to contain negative publicity and avoid any disruption of our relationships, we have conveyed our concerns about the transaction at high levels and regret that the press has portrayed us as approving transfers of sensitive enrichment and reprocessing technology.

Substance of Agreement

On June 25, FRG Foreign Minister Genscher wrote to you advising you that the agreement would be signed on June 27 (Attachment 1). His letter enclosed the Federal Government’s replies to parliamentary questions concerning the political and economic scope of the agreement, which contains a statement of the safeguards-related provisions. Bonn’s 10706 (Attachment 2) contains the text of the agreement itself. In addition, the FRG and Brazil have signed a protocol authorizing industrial cooperation in specified areas covering the entire fuel cycle, under terms which are spelled out in annexes which have not been made available to the U.S.

There are no surprises concerning the substance of the agreement as described in the replies to parliamentary questions or in the safeguards-related articles of the agreement itself. It provides for sale of up to eight reactors, a fuel fabrication plant, pilot reprocessing plant, and cooperation in uranium enrichment. The safeguards and controls are generally the same as those the FRG mentioned to us in bilateral discussions. Given the FRG decision to export the sensitive technologies of enrichment and reprocessing, which represents our fundamental objection to the sale, the safeguard conditions appear to be quite stringent and, with one possible major exception, appear consistent with likely understandings on common nuclear export policy which may be agreed by the nuclear suppliers.

However, neither the Q’s and A’s nor the text of the agreement mention FRG direct participation in the reprocessing and enrichment plants. The FRG has told us that they will have adequate flexibility under the agreement to ensure that these activities would involve “joint ventures” between the FRG and Brazil. Thus far, it would appear from Brazilian press reports that although the FRG’s involvement in facilities supplied to Brazil will be substantial at first, it will be largely for purposes of training, with the likely eventual result that Brazil will obtain purely national control of a full nuclear fuel cycle under safeguards. If this interpretation is not modified in the course of implementing industrial-level arrangements, it would be quite the opposite of the US concept of full and active supplier involvement in management and operations to provide an additional non-proliferation constraint.

German and Brazilian Statements

While concentrating on the substance of the FRG/Brazil agreement, the German Parliamentary reply indicates that the FRG “gained the impression that its objective arguments were understood” and that the US “expressed its satisfaction with the safeguards agreed upon.” The FRG does not give the slightest hint of our repeated expressions of concern over the unprecedented transfer of sensitive enrichment and reprocessing technology involved in the agreement—those elements of the sale (in contrast to the power reactors) which we argued were potentially dangerous, given the difficulty of effecting sufficiently adequate safeguards. In fact, as indicated in the attached press report (attachment 3), Schmidt recently stated that we did not make “a single criticism” of the nuclear transaction and that “I suppose this is not of primary importance” to the USG. This, of course, is inconsistent with your discussion with Foreign Minister Genscher and the press statements made after your meeting.

Your attention is also called to three cables (attachment 4) which indicate that Foreign Minister Silveira, enroute to Bonn for the signing, disclosed to Brazilian journalists that you had communicated with him on the FRG-Brazil nuclear accord. As a result Jornal de Brasília reported you as guaranteeing Washington concurrence in the terms of the agreement, but did not mention the concerns you expressed in your message to Silveira about proliferation. Silveira has more recently refused direct comment on your letter, characterizing it as “personal.” In the context of concluding their nuclear agreement, both the Germans and the Brazilians seem to have distorted your communications and tried to make the US appear to approve sales involving the transfer of sensitive nuclear technology as long as safeguards are applied—a stance which is not only incompatible with our own national policy and our position vis-à-vis the other nuclear suppliers, but which is likely to fuel Congressional concerns even further.

Further Steps

In order to clarify our position on the German-Brazilian sale, we believe we need to remind appropriate FRG and GOB officials that while we wish to contain negative publicity and avoid any disruption of our relationships, the fact remains that we did relay our concern at high levels about the transaction, and we regret that the press has portrayed us as approving transfers of sensitive enrichment and reprocessing technology. Attachment 5 is a draft cable, for your approval, instructing Ambassador Crimmins to so inform appropriate GOB officials. I believe that a similar message should be conveyed to FRG officials through their Embassy in Washington.

Recommendation

That you approve the cable at Attachment 5 instructing Ambassador Crimmins to remind appropriate GOB officials of our position concerning the transaction and expressing regret that we have been portrayed as approving the FRG/Brazil nuclear sale.

That you approve a similar approach to the FRG which I will convey to FRG Embassy representatives here in Washington.

1. Summary: Vest argued that the U.S. Government should clarify to the Brazilians and West Germans its concern with the nuclear proliferation implications of the Brazil-FRG agreement.

   Source: National Archives, RG 59, Central Foreign Policy File, P830113–0932. Secret; Exdis. Published from an uninitialed copy. Drafted by Nosenzo on July 7; cleared by Boright, Kratzer, Vine, and Rogers. Sent through Sonnenfeldt. Kissinger disapproved both recommendations, and a handwritten note indicates that he transmitted his decision in telegram Secto 6064, July 12. (Ibid., P840126–2194) Attached but not published is Genscher’s letter to Kissinger, June 25. Telegram 10706 from Bonn, July 1, is ibid., D750228–0240. Other attachments have not been found.