Office of the Historian

154. Minutes of a Senior Interdepartmental Group–International Economic Policy Meeting1

Washington, December 14, 1983, 2 p.m.

ATTENDEES

  • Treasury

    • Secretary Regan, Chairman
    • Beryl Sprinkel
    • Marc Leland

  • Office of the Vice President

    • G. Philip Hughes

  • State

    • Kenneth W. Dam
    • Thomas M. T. Niles
    • Elinor Constable

  • Defense

    • Dov Zakheim
    • William J. Weida

  • Agriculture

    • Secretary Block
    • Alan Tracy

  • Commerce

    • Olin Wethington

  • OMB

    • Joseph Wright

  • CIA

    • David Low
    • [name not declassified]

  • USTR

    • Ambassador Brock
    • Robert Lighthizer

  • AID

    • M. Peter McPherson
    • Bradshaw Langmaid

  • CEA

    • Martin Feldstein
    • Robert Thompson

  • Cabinet Affairs

    • Larry Herbolsheimer

  • OPD

    • Roger Porter

  • NSC

    • Roger Robinson
    • David Wigg

[Omitted here is discussion of the U.S.–EC Ministerial Report and food aid to Egypt.]

[Page 397]

International Debt Update

Treasury representatives reported on the status of Brazil’s credit package:

—
$6.2 billion of the $6.5 billion target has been raised.
—
Brazil had not been successful previously in the Middle East, but Delfim Netto had partially succeeded the previous week in raising OPEC participation.

Initial impressions of Argentine Economics Minister Grinspun were favorable. Announced economic policy changes appear to be for the good. Commercial banks dispersed $500 million on November 30, part of which was used to pay up some interest arrearages, leaving U.S. banks with no write-down problems vis-a-vis Argentina for 1983.

Jamaica is still negotiating with the IMF, and the Jamaicans express confidence they will sign a letter of intent by late December.

It was noted that the Mexican Government has requested of the Bank Advisory Committee that past loan spreads be renegotiated and that new spreads be cut. The initial creditor-bank reaction was one of concern, but apparently the Mexicans do not intend to press too hard on renegotiations.

The Chairman noted that Mexico has made substantial progress in rationalizing economic activity, but the inflation rate is still too high.

Regarding a Mexican request for $1.5 billion in CCC credits, the Chairman suggested that the staffs at Treasury and Agriculture meet to work out a response. It was agreed that the Mexican Government should be told immediately that they will not be getting the full amount requested.

The Chairman noted that $50 million in credit guarantees for the Philippines had just been released, and the Philippine Government was advised to move faster to meet IMF austerity requirements. The Chairman noted that an ESF bridging loan required an IMF program in place in order to have something to bridge to. It was agreed that the Philippine economic situation was deteriorating and that Manila was moving too slowly to reverse the situation.

Ambassador Brock suggested that a study be initiated:

—
To examine available U.S. means of providing credit and to determine which best serve U.S. interests, and
—
To look at U.S. credit resources and determine if they will meet ultimate demands.

Ambassador Brock noted that U.S. exports to LDC’s were down by 46 percent—a development that must be reversed.

  1. Source: Central Intelligence Agency, National Intelligence Council, Job 85–01156R: Policy, Planning, and History Records (1981–1984), Box 2, Folder 24: (SIG–IEP Meetings 1983). Confidential. The meeting took place in the Roosevelt Room at the White House. Sent under a January 10, 1984, covering memorandum from Hicks to multiple recipients.↩