PROPOSED PRESIDENTIAL LETTER TO CASEY ON USSR FERTILIZER DEAL

• Document Type: CREST
• Collection: Library of Congress
• Document Number (FOIA) /ESDN (CREST): LOC-HAK-259-6-59-4
• Release Decision: RIPLIM
• Original Classification: S
• Document Page Count: 3
• Document Creation Date: January 11, 2017
• Document Release Date: November 4, 2009
• Sequence Number: 59
• Publication Date: May 9, 1974
• Content Type: CABLE

No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4
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0 091959Z MAY. 74 ZFF-1 ZFF-4 ZYH
FM THE SITUATION ROOM
TO AMEMBASSY CAIRO
S F C R E T SENSITIVE EYES ONLY WH41239 25X1
ToHAK131
DELIVER TO BREMER/RODMAN FOR THE SECRETARY.
MAY 9, 1974
TO: SECRETARY KISSINGER
FROM: BRENT SCOWCROFT
SUBJECTO PROPOSED PRESIDENTIAL LETTER TO CASEY ON USSR FERTILIZER
DEAL
1. WE HAVE BEEN ASKED TO CONCUR IN CIEP PROPOSAL TO PRESIDENT
THAT HE SEND A LETTER TO EXIM BANK PRESIDENT CASEY EXPRESSING HIS
SUPPORT FOR EXIM FINANCING OF USSR FERTILIZER DEAL. TEXT OF PROPOSED
LETTER IS AS FOLLOWS:
QUOTE DEAR, MR. CASEY:,
PETER FLANIGAN BROUGHT TO MY ATTENTION THAT PORTION
OF YOUR TESTIMONY BEFORE THE SUBCOMMITTEE ON INTERNATIONAL
TRADE OF THE HOUSE BANKING`AND CURRENCY COMMITTEE WHICH
DEALS WITH THE EXPORT-IMPORT BANK'S COMMITMENT TO FINANCE
THE SALE OF AMERICAN PRODUCTS WHICH WOULD BE INCORPORATED
INTO A LARGE FERTILEZER COMPLEX IN THE SOVIET UNION.
MORI/CDF
C03344759
ON-FILE NSC RELEASE
INSTRUCTIONS APPLY
THE BANK WILL RESULT
INVESTMENT OF AMERICAN
EXPORTS FOR THIS COMPLEX, AND WILL TRIGGER MILLION
SUBSTANTIAL FUNDS AND THE CREATION OF JOBS IN SHIPBUILDING AND
PHOSPHATE DEVELOPMENT IN FLORIDA.
YOU ALSO INDICATE THAT AS A RESULT OF THIS TRANSACTION TWO
NITROGEN FERTILIZERS (,AMMONIA AND UREA) WHICH ARE SCARCE IN OUR
COUNTRY WILL BE ACQUIRED WITHOUT A CASH DRAIN ON OUR BALANCE
OF PAYMENTS, IN EXCHANGE FOR SUPERPHOSPHORIC ACIDS A FERTILIZER
* * * * * * *.* * * * * *'* *
MCFARLANE,SECFILE
.*WHSR ? COMMENT * * * * * * * * * *: * * * * *
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No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4
 No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4
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WHICH WE HAVE IN ABUNDANCE AND WHICH WOULD BE PRODUCED IN
FLORIDA AND SHIPPED TO THE SOVIET UNION. THE NITROGEN FERTILIZERS`
COMING TO THIS COUNTRY WOULD BE MADE WITH SOVIET NATURAL GASv
THUS REDUCING THE DRAIN ON OUR OWN NATURAL GAS RESER ES?
I BELIEVE THAT THIS TRANSACTION, RESULTING NOT ONLY IN TRADE
AND BALANCE OF PAYMENTS BENEFITS FOR US RUT ALSO CONTRIBUTING
TO OUR OWN FERTILIZER AND ENERGY NEEDS AS WELL AS TO WORLD FOOD
NEEDSs MAKES EXACTLY THE KIND OF CONTRIBUTION TO THE NATIONAL
INTEREST WHICH I ENVISIONED WHEN I MADE THE DETERMINATION, ON
OCTOBER 18P 19725 THAT IT IS IN THE NATIONAL INTEREST FOR EXIMBANK
To FINANCE U.S. EXPORTS TO THE SOVIET UNION.
SINCERELY,
RICHARD NIXON UNQUOTE
2. AS YOU WILL RECALL, SOME WEEKS AGO EXIM WAS HESITANT TO MOVE
AHEAD WITH THE FERTILIZER PEAL IN LIGHT OF CONGRESSIONAL OPPOSITION TO
CREDITS FOR THE USSR FOR FEAR THAT THIS TRANSACTION MIGHT
JEOPARDIZE CONGRESSIONAL ACTION ON THE EXIM AUTHORIZATION BILL.
HOWEVER, CASEY HAS RECENTLY CHANGED HIS POSITION AND NOW FAVORS MOVIN
G
AHEAD WITH THE TRANSACTION IN THE BELIEF THAT IT IS ECONOMICALLY
SOUND AND WOULD NOT JEOPARDIZE THE EXIM LEGISLATION.
3. SENATOR STEVENSON,HAS SUGGESTED THAT A PRESIDENTIAL LETTER TO.
CASEY SUPPORTING THE FERTILIZER PROJECT AND EMPHASIZING ITS ECONOMIC
BENEFITS FOR THE UNITED STATES MIGHT CREATE A BETTER UNDERSTANDING
IN THE CONGRESS.
4. 1 BELIEVE THE FOLLOWING CONSIDERATIONS ARE RELEVANT:
PRO
--THE PRESIDENTIAL LETTER WOULD BE IN KEEPING NITH ADMINISTRATION
SUPPORT FOR INCREASING, MUTUALLY BENEFICIAL US-USSR TRADE.
--THE FERTILIZER DEAL, WHICH INVOLVES A $180 MILLION CREDIT
WOULD BE THE FIRST MAJOR DEAL (EXCEPTING KAMA RIVER) WITH THE
USSR SINCE THE 1972 TRADE AGREEMENT. PRESIDENTIAL SUPPORT FOR THE
TRANSACTION WILL PUT HIM ON SOLID GROUND IN HIS ECONOMIC TALKS AT
THE MOSCOW SUMMIT EVEN IF THE MFN ISSUE REMAINS UNRESILVED.
--IT ISDESIRABLE FOR THE ADMINISTRATION TO TAKE ACTION PROIR
TO THE LATE MAY MEETING OF THE US-USSR JOINT COMMERCIAL COMMISSION
Sp THAT SUCH ACTION WILL NOT APPEAR TO RESULT FROM SOVIET PRESSURE
DURING THE COMMISSION, MEETING.
--THERE IS EVERY INDICATION THAT THE FERTILIZER DEAL IS IN
THE UNITED STATES' ECONOMIC INTERESTS.
CON
--CONSIDERING THE USSR CREDIT CLIMATE IN THE CONGRESS IT IS.
QUESTIONABLE WHETHER THE PRESIDENT SHOULD INVOLVE HIMSELF PERSONALLY
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No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4
 No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4
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IN THE TACTICAL MANEUVERING ON THE FERTILIZER DEALS PARTICULARLY
IF THE BENEFITS FOR THE UNITED STATES SHOULD TURN OUT TO BE LESS
THAN EXPECTED.
--THE ECONOMIC ISSUES ASIDE, THE PRESIDENT MAY BE OPENED
TO FRESH CHARGES FROM THE ANTI-DETENTERS AND THOSE WHO ARE URGING
POSTPONEMENT OF THE MOSCOW SUMMIT THAT HE IS PUSHING AHEAD WITH
MOVES WITH THE SUMMIT IN MIND MERELY TO PL Ee,SE THE SOVIETS, MOVES
THAT MAY NOT BE IN THE U.S". BEST INTERESTS.
5. IN VIEW OF THE CHANGED ASSESSMENT OF THE IMPACT ON THE
EXIM BILLS I RECOMMEND GOING AHEAD WITH THE PRESIDENTIAL
LETTER TO CASEY. THE TIME FACTOR IS VERY TIGHT; EXIM'S PRELIMINARY
CREDIT WILL EXPIRE ON MAY 14. IF YOU AGREE, I WILL ADVISE THE
PRESIDENT THAT YOU APPROVE GOING AHEAD WITH THE LETTER TO CASEY.
857
APPROVE ----------
DISAPPROVE-----w--
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No Objection to Declassification in Part 2009/11/04: LOC-HAK-259-6-59-4