19. Notes of a Meeting1
NOTES ON VANCOUVER SUMMIT PREPARATORY MEETING
On the whole the meeting went extremely well. The macroeconomic and trade issues are becoming the key points of contention. Surprisingly, the discussion of East-West trade provoked few sparks [Page 51] and was even welcomed by most delegations. North-South issues have now been refined down to two key areas of disagreement—the need for global negotiations and for increased lending for energy development in LDCs. The energy issue reflects the largest degree of consensus among the Summit countries.
[Omitted here is discussion of macroeconomic issues.]
North-South Issues
Kikuchi (Japan) welcomed the revised North-South paper.2 He saw no serious difficulties with the paper as a whole. However, the structure and emphasis had changed. Official Development Assistance (ODA) had been de-emphasized and more attention given to private trade and investment. Yet ODA is the main element of our relations with the South. Further, we should not suggest that the NICs are beyond the need for concessional assistance. We should say that they are approaching a stage where they can reduce their dependence on concessional assistance. The software side of AID, namely management and technical assistance, needs more emphasis. He worried about the paper being published and sending the wrong signals to the Third World.
Nau (US) responded that under no circumstances should this paper see the light of day. This was an internal Summit document intended for our heads of government and should be treated with the strictest confidentiality. On the paper itself, the US also welcomed the new revision. It is a good deal more realistic. The exports of manufactures by the non-oil LDCs amounted to some $90 billion in 1980. This is four times the level of official development assistance. Taking note of this fact, as the paper does, is not to de-emphasize ODA but to complement it. Trade and AID are complementary, not competing means of assistance to the developing countries. They both require political will from the industrial countries. Japan makes an important contribution in both areas. We would like to see a more explicit treatment of this notion of complementarity in paragraph 20 of the paper. In addition, the paper should at least mention the contributions of the industrial countries to development in the past. It should also state more clearly that the major responsibility for development rests with the developing countries themselves, and it should take note of the severe impact of oil price increases on all countries, as the German delegate mentioned in our discussion of the macroeconomic paper. Finally, we cannot agree with the present language in the paper on the energy affiliate and global negotiations, and we would like to see greater emphasis in the paper [Page 52] on national food reserves as a measure of food security, on the role of the private sector in development assistance, and on the importance of conditionality as a basis for debt financing and management. We cannot accept the paragraph on automaticity.
Armstrong (UK) felt that the analysis section of the paper was still too defensive. Further, it should stress LDC responsibility and seek to be as precise as possible in paragraph 17 dealing with the common objectives of the industrial countries in relations with the developing world. Finally, the document is still too long. It does not focus the discussion for the heads of government. He suggested that the analysis section be retained as a support annex and that the last section of the paper be sharpened up to focus the discussion that will actually take place at the Summit.
Gotlieb (Canada) asked for views on Armstrong’s suggestion.
Rashish (US) suggested the possibility of a schematic paragraph at the beginning of the paper which would advise the reader of what was covered leaving it up to the reader to focus on whatever he or she desired. Armstrong (UK) agreed that an executive summary might suffice.
Schulman (Germany) noted with some emphasis that the paper was not intended for publication and should not under any circumstances be released. As to the Chancellor’s views on North-South issues, he had made these known recently in an article in Foreign Affairs.3 Above all, he believes the dialogue must see things as they are. This implies five points: (1) no nation can deny its share of responsibility in North-South affairs; (2) a solution to the energy problem is vital. Without it there is no solution to the North-South problem; (3) population growth control is unavoidable; (4) ODA is necessary but private flows are also important; (5) LDCs must show a greater willingness for multilateral cooperation in their regions. Moreover, we must consider how to get the Eastern countries, particularly the Soviet Union, more involved. This has not been given enough attention. They must be urged to contribute to UN institutions in convertible currencies, to open their markets to LDCs without political conditions or insistence on barter arrangements. This is a political demand that must be put on the table. We must try to embarrass and expose the Soviet Union in all fora. Finally, we cannot accept the words of NIEO in paragraph 5. This goes too far.
Berlinguer (Italy). The responsibility of industrial countries for development should be stressed, but the responsibilities of the LDCs, communist countries, and OPEC must also be stressed. For tactical reasons we should emphasize the responsibility of the communist [Page 53] countries. On the basis of this paper, what are we proposing to our leaders to do?
Paye (France). The paper should indicate the effects of the oil shocks. The LDC problem as it is described in the paper is too limited to the financial side. The idea of regional cooperation is an important one.
Spaak (EC) wondered what we would say in the communique. The new version of the paper is improved, but the paper should retain the notion that the South is not a myth, and the language should be strengthened on financial institutions and on food reserves. The EC regrets the retreat in the paper from a political declaration on aid. It also would like to see the paragraph retained on automaticity.
Gotlieb (Canada) suggested that the point in paragraph 20K on predictability could be retained, and it is a separate point from that of automaticity.
[Omitted here is discussion of East-West issues.]
- Source: Reagan Library, Douglas McMinn Files, Economic Summit Files, Ottawa—Preparatory Meetings. No classification marking. No drafting information appears on the notes. The notes are from the Vancouver preparatory meeting for the Ottawa Summit, which took place June 4–6.↩
- Not attached. A copy of the “Report of Personal Representatives to Summit” on North/South Issues, dated July 7, is in the Reagan Library, Executive Secretariat, NSC Trip File, Ottawa Summit 1981—North-South Canadian Paper; NLR–755–10–9–2–1.↩
- Schmidt’s article, “A Policy of Reliable Partnership,” was published in the Spring 1981 issue of Foreign Affairs.↩