MITTERRAND S OECD SPEECH: IS THERE MORE THAN MEETS THE EYE?

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00287R000501410001-2
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 4
• Document Creation Date: December 22, 2016
• Document Release Date: August 20, 2010
• Sequence Number: 1
• Publication Date: May 16, 1983
• Content Type: MEMO

Mern Sanitized Copy Approved for Release 2011/03/11: CIA-RDP85T00287R000501410001-2 /
This memorandum was prepared by
for Henry Nau, NSC,
in preparation for the Williamsburg Summit.
Distribution:
16 May 1983
A
'Office of European Analysis
Orion - Henry 'tau, NSC.
1 - NIO/WE
1 - `D/EURA
2 - EURA Prod. Staff
4 - I^C/CB
1 - C/i`VE Div.
.1 - Branch File
1 - Author
DDI/EURA/WE/C!
23,1ay83)
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16 May 1983
Mitterrand's OECD Speech: Is There More Than Meets the Eye?
Summary
President Mitterrand's lengthy speech on 9 May was a preview of likely
French positions at the Williamsburg Summit as well as at the June EC Council
meeting in Stuttgart. We find that substantively -- despite the apparent
drama of the "new-Bretton Woods" proposal -- the speech offers little that is
really new. Nevertheless, both the circumstances and the content suggest that
Mitterrand was trying to stake out a position on the high ground. It may well
be that the speech was simply an attempt to upstage the Summit and yet another
in a long series of appeals by French leaders for the sympathy of the
developing world. In the context of what we know of Mitterrand's current
preoccupations and sensitivities, however, we believe it useful to consider
the possibility that his remarks may portend more troublesome moves.
Mitterrand undoubtedly was looking for extensive press coverage and high-
level government attention by choosing a reception for OECD ministers as his
forum. The timing could hardly have been better calculated to enhance his
image as a statesman and major summit player.* He probably also saw an
opportunity to upstage the US initiative scheduled for the following evening
-- the dinner for trade and finance ministers. The headlines that appeared
the next day may not have been exactly what Mitterrand expected, however.
Even though the new Bretton Woods proposal was essentially an updated version
of various Giscardian ideas dangled before previous summits, reporters focused
on it to the virtual exclusion of other aspects of what was probably intended
to be a carefully balanced effort.
Throughout the speech, Mitterrand appeared to want to avoid the
impression of being polemical or of giving ultimatums. Even though US
economic policies have once again become a favored scapegoat for France's
economic ills and have come under heavy attack by politicians speaking before
domestic audiences, Mitterrand's remarks on 9 May were critical only by
implication. Even the critical references were balanced somewhat with
approving references to successful initiatives of other nations in which a US
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G JA _L
role could also be inferred -- an uncharacteristic gesture for a French
leader.
On the topic of revamping the international monetary system, Mitterrand
stressed that the conference he was proposing would require careful
preparation under the auspices of the IMF. Whatever the reception he
anticipated for the program as outlined, he clearly appreciates that such
reforms could only be the work of years.
Although the US Embassy has reported that the speech was not fully
coordinated among the various ministries, it may be that the principal
drafter, senior presidential adviser Jacques Attali, drew on years of staff
work on monetary ideas by the Bank of France and the Treasury, perhaps in the
interest of preserving secrecy, perhaps in order to safeguard his bureaucratic
turf. Most of the other ideas in the speech have been around for a long time
and are not unique to this French government.* We do not believe that the
absence of coordination and the fact that the speech seldom broke new ground
necessarily signify that Mitterrand intended it to be taken as anything less
than a benchmark exposition of his views.
This leaves us with the question whether there is any more to this
Mitterrand exercise than pre-summit posturing. There are indications that
there may be, although the most alarming possibility -- that Mitterrand is
setting the stage for more dramatic gestures at (or after) Williamsburg and
Stuttgart in the event he concludes he is not getting a fair hearing --
appears to run counter to attitudes he holds strongly and positions to which
he has committed his personal prestige.
Mitterrand firmly rejected economic autarky and protectionism and, while
acknowledging its shortcomings, spoke approvingly of the EC. In addition, he
had kind words for both the IMF and GATT, and -- although his old skepticism
about the efficiency of markets remains -- he made several relatively positive
references to their role. Each of these points of Mitterrand's can be seen as
rebutting positions advocated by leftist hard liners -- not least those within
his own Socialist party -- who favor greater protectionism, diminished ties to
Europe, and a policy of more nationalistic and statist assertiveness in
general. The 9 May speech was quite consistent with the positions Mitterrand
has taken on these issues on more than one occasion since taking office.
Nevertheless, there is a possibility that Mitterrand has reached such a
level of personal frustration over France's economic problems and what he
believes is a less than sympathetic hearing for France's needs among Summit
and EC leaders that he might be motivated to show his displeasure -- for
* Given Attali's work as France's Sherpa, his decision to keep the drafting
work basically within his own staff may have been intended to give added
emphasis to the French "objection" to the US dinner on 10 May: that it was a
needless addition to the Summit preparatory process, Mitterrand himself
presumably having his positions well in hand.
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G JA _L
example, by boycotting future summits or withdrawing from the EMS. If this
were the case, then the high-minded, internationalist tone of the 9 May speech
might perhaps have been intended to allow Mitterrand to act with a "clear
conscience." We still believe, on balance, that Mitterrand would be reluctant
to take measures that risked seriously damaging France's relations with its
closest allies, especially in the year of INF deployment, and that could lead
to further difficulties for the French economy. We also believe, however,
that there is a possibility that the French tendency to blame others for their
problems could come to the fore. With Mitterrand's frustration running high
over, for example, US reluctance to "compensate" France for Mitterrand's anti-
Soviet stance, we believe that there is an outside chance that the apparently
irrational could, in fact, happen.
Mitterrand characteristically has left himself the option to go either
way. Although he twice appeared to question the usefulness of summits -- both
of the Seven and the EC -- he stopped short of threatening French
withdrawal. In one reference to summits, he said (emphasis ours):
I have spoken to you of European meetings, and a summit of industrialized
nations is coming up; we can see on these occasions if we are on the
right road, or if we are choosing anarchy and crisis rather than
recovery. Each will draw the consequences he wishes, and will assess the
utility of this type of gathering.
Mitterrand could merely be signaling the possibility of greater French reserve
toward future summit work, with perhaps more emphasis on bilaterialism. On
the other hand, there is an echo of the French position on the post-La
Sapiniere studies -- that only national conclusions could be valid -- and he
could be setting the stage for something more serious.
The first reference to summits was more specific (emphasis ours):
And yet, as the conclusions of the working group on intervention...show,
monetary coordination is clearly useful when there is market disorder and
when the short-term volatility of exchange rates accelerates. Are we not
in such a situation today? Haven't the Seven-affirmed their will to
put in place coordinated intervention in cases when their usefulness is
recognized? If not, why keep having international meetings?
By asking a question, Mitterrand left his options open. But he appears to
expect some concrete action to be taken on the Versailles intervention study
at Williamsburg. We know that Mitterrand and economic czar Delors are very
much concerned that the dollar's current value in relation to the franc is
jeopardizing their goal of reducing the balance-of-payments deficit this year
(approximately 40 percent of French imports are invoiced in dollars). We do
not know what kind of action might satisfy Mitterrand -- perhaps as little as
an agreement to linking the Versailles study to eventual preparatory work for
an IMF monetary conference -- but we suspect that this is the specific issue
on which the danger of his responding to frustration with an aggressive
gesture of some kind is greatest.
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