STAFF NOTES: WESTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86T00608R000500040032-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 10
• Document Creation Date: December 15, 2016
• Document Release Date: July 23, 2004
• Sequence Number: 32
• Publication Date: October 9, 1975
• Content Type: REPORT

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Meetings Show Opportunities and Limits of
EC Mediterranean Diplomacy . . . . . . . . . 4
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West German Foreign Minister in Warsaw to
Sign A^,core . . . . . . . . . . . . . . . . . 7
EC Delegation Holds Talks in Bucharest . . . . 8
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Swedes Catch Finn Smuggling . . . . . . . . . . 12
October 9, 1975
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Meetings Show Opportunities and Limits of EC
Mediterranean Diplomacy
The EC's ambition to assert a "European
identity" in the Mediterranean and Middle East
was evident at community meetings in Luxembourg
and Rome this week, but so also were the prob-
lems that make showing a common front a slow
business.
Nearest to home and the current political
preoccupations of Western Europe were the situa-
tions in Spain and Portugal, addressed at an EC
Council of foreign ministers in I:,uxembourcq. The
Council ended up by supporting the EC Commission
in breaking off current EC-Spain negotiations,
but the Nine were quite divided on how strongly
the community should publicly condemn Madrid.
Even on the trade negotiations, it seems clear
that some of the Nine wonder whether a long-
term suspension would serve the goal of event-
ually drawing a democratic Spain closer to the
EC.
The aid which the community agreed to make
available to Portugal reflects more a hope that
Lisbon's continuing political crisis will in
fact permit an effective "pluralist democracy"--
the EC's original condition for aid--than a
sanguine belief in Portugal's prospects. It is
in any case a good sign that the EC, iii also
pledging to negotiate with Portugal on the "evol-
utionary clause" of the preferential EC-Portugal
trade agreement, apparently recognizes that trade
may be even more important to Lisbon now than
financial aid. it may nevertheless be difficult
for the community to demonstrate generosity to
Portuguese exports when the bargaining comes.
October 9, 1975
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The EC-Nine have not had much effect with
their demarches to Turkey and Greece over. Cyprus,
but at a meeting of the BC political directors
in Luxembourg they stated their intention to
pursue their efforts, particularly in Turkey after
Sunday's senate elections. The Nine continue to
want to be in phase with US, and UN, attempts to
pressure the parties.
The EC ministers made no substantial pro-
gress on the negotiations for association agree-
ments with the Maghreb countries, but it appears
that an effort will be made to advance the Tuni-
sian and Moroccan accords, leaving the more con-
tentious negotiations with Algeria until. later.
Financial questions were uppermost in dis-
cussions of the pending BC accord with Malta
and the preparations for talks with the Mashrak
states. A German proposal was agreed to that
will increase the EC's previously "non-negoti-
able" offer of aid to Malta. Overruled was
opposition by the French, British, and Dutch, who
doubtless fear that any softening on the part of
the community would be taken advantage of by
Mintoff in a repeat performance of the negotia-
tions with Britain and NATO over retaining base
rights on the island.
On the proposed Mashrak negotiations there
is evidently some reserve about according finan-
cial aid, in part because of doubts these east-
ern Mediterranean states really need concession-
ary assistance and also because of possible bud-
getary constraints when demands for aid from
other non-associated countries are taken into
account. A financial package for the Mashrak
countries could also open up again the question
of a financial agreement with Israel, something
the BC would rather avoid having to deal with at
present.
October 9, 1975
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In discussing a Commission proposal for
long-term food supply contracts with Egypt--
in fact already negotiated in detail with the
Egyptians by agricultural commissioner Lardinois
prior to any authorization by the Council--the
foreign ministers made clear that they consider
such matters primarily a political exercise that
should be firmly under their control. It appears
that approval will ultimately be granted, but the
Germans and others will have to be assured that
the agreement will not set a precedent that could
aggravate relations with other large agricultural
exporters (the US and Canada, in particular) and
that private traders, not the EC, will have to
bear the economic and monetary risks inherent in
a long-term deal.
EC Middle East experts, meanwhile, meeting
in Rome, again tried to come to grips with up-
dating the Nine's declaration of 1973 on the Mid-
dle East situation. Paris is apparently pushing
for a new declaration and the Germans seem will-
ing to sponsor one, but there is no great enthus-
iasm from the other EC partners, especially from
the Dutch and Danes, who probably fear another
statement that might be criticized domestically
for an anti-Israeli slant. F77
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West German Foreign Ilinister in Warsaw to
Sign Accord
West German Foreign Minister Genscher arrived
in Poland today to sign an agreement providing West
German economic aid in return for the repatriation
of ethnic Germans. Genscher also will meet with
Communist Party leader Gierek and other high-ranking
officials to discuss bilateral relations, particularly
the further development of economic cooperation.
The agreement was worked out by Chancellor
Schmidt and Gierek during the European security
conference summit meeting in July. The accord
specifies that Bonn will make a lump sum payment
of about $500 million to a Polish pension fund and
extend a low-interest loan of about $400 million.
In return, Warsaw will permit some 125,000 ethnic
Germans to emigrate over the next four years.
Schmidt must obtain parliamentary approval of
the payment to the Polish pension fund. Opposition
Christian Democratic leaders have criticized the
accord, charging the Poles with using extortionary
methods. They also accuse Bonn of having paid twice
for the same thing, a reference to the Brandt govern-
ment's political payment for the emigration of ethnic
Germans through recognizing the Oder-i1eisse line in
the 1970 treaty.
The Christian Democratic opposition has a
one-vote majority in the upper house of parliament,
and could block the pension payment. This would
involve a major political risk, however, for the
government could accuse the opposition of endanger-
ing a humanitarian accord.
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October 9, 1975
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An EC commission delegation is in Bucharest
to discuss a bilateral textile agreement.
These are the first negotiations between the
EC commission and an individual CEI1A member since
the Soviets began pressing for an overall EC-CEPIA
relationship almost two years ago. Romania and
Hungary indicated to the EC last spring that they
were willing to negotiate a textile agreement in
the context of the International Multilateral
Fiber Agreement that each has signed.
and Bucharest is eager to increase this figure.
The romanians may press for loans and credits at
favorable rates as well as increased industrial
cooperation, including joint ventures in Romania.
I the Romanians
also want to use e current a s to discuss a
broad range of trade issues, outside the CEMA con-
text and without any Soviet participation. Thirty
percent of Romania's trade ;_s already with the EC,
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The timing of the EC-Romanian textile negotia-
tions--just before the planned CEIIA summit next
month--underscores Bucharest's determination to
pursue and expand bilateral ties with the EC.
Deputy Premier Patan recently asserted, in fact,
that such contacts could proceed without waiting
for the conclusion of a CEC1A-EC general accord.
The Soviets, however, prefer to have the general
accord precede bilateral contacts. rioscow apparently
also wants a more comprehensive agreement than does
Bucharest. Foreign Minister Ilacovescu informed
his visiting Belgian counterpart last week that
25X1 Romania is hoping to establish good relations with
the community.
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Swedes Catch Finn Smuggling
The treasurer of the Finnish Social Demo-
cratic Party, Pentti Ketola, was seized by police
at Stockholm's Arlanda airport on October 5
trying to take $44 thousand in Swedish currency
out of the country without a permit.
Ketola claimed that he had received the
money at the recent Swedish Social Democratic
P?zrty congress, and did not know that he needed
a permit.
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Initial press reports led to a series of
embarrassing denials and retractions by various
Finnish Social Democrats, considered ahead
in the Metalworkers Union campaign, are hopeful
that this contretemps will not cost them the
election next month. A Communist victory would
lessen chances that Finnish politicians, in the
wake of the inconclusive parliamentary election
last month, can put together a moderate coalition
able to enact overdue austerity legislation to
cope with the country's economic difficulties.
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