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ACTION IO-10
INFO OCT-01 ISO-00 AF-06 ARA-10 EA-10 EUR-12 NEA-09 RSC-01
CIAE-00 DODE-00 PM-03 H-02 INR-07 L-02 NSAE-00 NSC-05
PA-02 PRS-01 SP-02 SS-15 USIA-15 AID-05 COME-00 EB-07
FRB-01 TRSE-00 XMB-04 OPIC-06 CIEP-02 LAB-04 SIL-01
OMB-01 FEA-01 MC-02 ACDA-10 AGR-10 STR-04 /171 W
--------------------- 041982
R 051934Z FEB 75
FM USMISSION USUN NY
TO SECSTATE WASHDC 9055
INFO AMEMBASSY OECD PARIS
USMISSION EEC BRUSSELS
UNCLAS SECTION 1 OF 2 USUN 0384
E.O. 11652: N/A
TAGS: OCON, UN
SUBJ: SUMMARY FEBRUARY 4 MEETING UN EMERGENCY OPERATION
SUMMARY: FEBRUARY 4 MEETING UN EMERGENCY OPERATION, CHAIRED
BY RAUL PREBISCH, PROVIDED USEFUL OCCASION REVIEW URGENT AID
NEEDS OF NATIONS MOST SEVERELY AFFECTED BY RECENT ECONOMIC
DISLOCATIONS AND TO NOTE RESPONSES OF BOTH TRADITIONAL DONORS
AND OPEC NATIONS. PREBISCH CITED IMF/IBRD ESTIMATE OF
$3 BILLION FINANCING GAP FOR MSA'S AND SAID WHILE FOOD NOW
ABAILABLE TO MEET NEEDS, MEANS TO BUY IT WAS NOT. FAO
SPOKESMAN, OJALA GAVE STATISTICAL RUNDOWN OF CURRENT MSA
NEEDS AND ESTIMATED REQUIREMENTS FOR BALANCE OF CY-75. IRELAND
REP SPOKE ON BEHALF OF EEC, REAFFIRMED PLAN FOR $500 EQUIVALENT
TO MSA NATIONS FROM EEC COUNTRIES AND ANNOUNCED PLAN TO
CONTRIBUTE NOW $100 MILLION OF WHICH ONE THIRD TO GO TO
SYG UNEO SPECIAL ACCOUNT. OTHER EUROPEAN NATIONS ENDORSED
EEC PLEDGE AND ADDED FEW DETAILS ON BILATERAL AID COMMITMENTS
OR PROPOSALS. OPEC NATIONS (LIBYA, VENEZUELA, IRAN)
RESTATED PLEDGES GENERALLY ALONG LINES PREVIOUSLY LISTED.
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USSR AND GDR REPS TOOK OCCASION TO LINK PLIGHT LDC'S TO
CAPITALIST SYSTEM AND EFFORTS OF MONOPLIES AND TRANSNATIONAL
FIRMS TO EXPLOIT FOREIGN RESOURCES; USSR OFFICIAL SAID
ARMS RACE EXACERBATED LDC PLIGHT AND AFAVORED CESSATION ARMS
RACE AND CUT IN MILITARY SPENDING.
U.S. SPOKESMAN, AMB FERGUSON, NOTED US WOULD CONTINUE
MAKE MAJOR EFFORT PROVIDE MSA'S ADDITIONAL AID VIA EXISTING
BILATERAL AND MULTILATERAL CHANNELS. WHILE US NOT WILLING
PARTICIPATE IN SPECIAL FUND, WHICH MIGHT BE APPROPRIATE
VEHICLE FOR NEW CONTRIBUTORS, THIS WOULD NOT AFFECT EFFORTS AID
MSA'S IN COOPERATION WITH UNEO. AS OF FEBUARY 3 ANNOUNCEMENT,
US FOOD AID UNDER PL480 EXPECTED BE $1.47 BILLION IN
COMMODITIES PLUS FREIGHT FOR GROSS FIGURE OF $1.6 BILLION.
THIS AMOUNT OVER $600 MILLION GREATER THAN LAST YEAR'S ACTUAL
EXPENDITURES AND SHOULD PROVIDE ABOUT 5.5 MILLION TONS GRAIN.
END SUMMARY.
1. MEETING FEBRUARY 4 OF UN EMERGENCY OPERATION (UNEO) CHAIRED
BY PAUL PREBISCH IN ABSENCE OF SYG. PREBISCH OPENED
MEETING CITING RATIONALE FOR EXISTENCE UNEO AND REITERATION
PLIGHT OF NATIONS MOST SEVERELY AFFECTED BY RECENT ECONOMIC
DISLOCATIONS. HE NOTED ESTIMATES OF IBRD/IMF INDICATE
BALANCE PAYMENTS GAP OF MSA'S FOR 1975 MIGHT EXCEED
$3.0 BILLION COMPATED WITH FIGURE OF $2.3 BILLION ESTIMATED
IN SEPTEMBER, 1974. TOTAL RECEIPTS IN UNEO'S SPECIAL ACCOUNT
AS OF 15 JANUARY 1975 WERE $147.5 MILLION, ALMOST
ALL OF WHICH HAD BEEN ALLOCATED WHILE $213.5 MILLION HAS BEEN
PLEDGED. PREBISCH SAID IN COURSE RECENT WORLD FOOD CONFERENCE
IN ROME EXPERTS IDENTIFIED URGENT FOODGRAIN NEEDS OF MSA'S AT
7.5 MILLION METRIC TONS THIS YEAR. WHILE THIS AMOUNT GRAIN IS
AVAILABLE, PREBISCH NOTED, THE MEANS TO BUY IT IS NOT.
2. NEXT SPEAKER, E.M. OJALA, ASSISTANT DIRECTOR GENERAL
OF FAO IN ROME, ASSESSED FOOD AND FERTILIZER IMPORT REQUIREMENTS
OF MSA'S. IN 1974, OJALA SAID, DEVELOPING COUNTRIES EXPERIENCED
GREAT DIFFICULTY FINANCING NEEDED FERTILIZER IMPORTS, ALTHOUGH
BY NOVEMBER SUPPLY AND PRICE SITUATION HAD EASED. INTERNATIONAL
FERTILIZER SCHEME, ESTABLISHED BY THE FAO AT REQUEST OF
ECOSOC, WAS MONITORING FERTILIZER SUPPLY AND DEMAND SITUATION.
IN SPITE OF INCREASED BILATERAL ASSISTANCE OF FERTILIZER, FAO
ESTIMATED FINANCIAL CONSTRAINTS WILL CAUSE MSA'S TO SUFFER
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SHORT-FALL OF 337,000 TONS OF NUTRIENTS IN THE YEAR ENDING
6/75 WHEN COMPARED WITH LAST YEAR'S LEVEL PLUS A REASONABLE
INCREMENT. THIS FERTILIZER SHORT-FALL COULD BE THE EQUIVALENT
OF 2.7 MILLION TONS OF GRAIN. ON THE FOOD FRONT, THE FAO
OFFICIAL ESTIMATED WORLD'S WHEAT AND COARSE GRAIN HARVEST IN
CY-74 AT 4PERCENT BELOW PREVIOUS YEAR WHILE THE RICE
HARVEST WAS DOWN 1 PERCENT. HE ESTIMATED NEED BY MSA'S
FOR IMPORTED GRAIN FOR YEAR ENDING 6/75 AT 17 MILLION
TONS, UP 5 MILLION FROM THE PREVIOUS YEAR. THE AMOUNT
STILL TO BE FINANCED HE ESTIMATED AT 4.8 MILLION TONS VALUED
AT $1 BILLION PLUS $200 MILLION FOR FREIGHT. THE GRAIN IS
AVAILABLE, OJALA SAID: FUNDING IS THE PROBLEM. FOR THE
FUTURE, IN THE SECOND HALF OF CY-75 MSA'S ARE LIKELY TO NEED
AN ADDITIONAL 6 MILLION TONS OF GRAIN COSTING ABOUT $1.3 MILLION
INCLUSIVE OF FREIGHT AT CURRENT PRICES ACCORDING TO FAO.
ALTHOUGH, SAID OJALA, THE LEVEL OF CEREALS SUPPLIED AS FOOD
AID IN 74-75 MIGHT NOT BE MUCH GREATER THAN THE PREVIOUS YEAR'S
LEVEL AT 6.9 MILLION TONS HE NOTED THAT "IT MAY BE A TRIBUTE
TO THE WORK AT UNEO THAT .. UP TO JANUARY 24 (BEFORE
THE FEBRUARY 3 ANNOUNCEMENT OF U.S. PL480 AID FOR FY-75)
COMMITMENTS OF FOOD AID TO MSA COUNTRIES TOTALLED 3.1 MILLION
TONS, COMPARED WITH 1.5 MILLION TONS FOR 1973/74.."
3. OTHER SPEAKERS: IRELAND (AMB. KENNEDY) REPRESENTING EEC,
REAFFIRMED PLAN FOR $500 MILLION EQUIVALENT FOR EEC COUNTRIES
FOR AID TO MSA'S AND ANNOUNCED PLAN TO CONTRIBUTE NOW
$100 MILLION OF WHICH ONE-THIRD TO BE GIVEN TO SYG SPECIAL
ACCOUNT (BRINGING TOTAL GIVEN UNDER UNEO TO ABOUT $250
MILLION). THE UK REP ENDORSED EEC PLEDGE, SAID ALMOST
$119 MILLION HAD BEEN OFFERED BY UK AND ADDED FURTHER
ADDITIONAL COMMITMENT WOULD INCLUDE: 20 MILLION POUNDS
STERLING TO INDIA, 5 MILLION STERLING TO WORLD FOOD PROGRAM
AND 5 MILLION STERLING TO UNEO, BRINGING GRAND TOTAL
UK ASSISTANCE TO 83 MILLION STERLING OR APPROXIMATELY
$200 MILLION. UK SPOKESMAN NOTED 12 MONTH MANDATE UNEO
NEARING END AND SAID ALTHOUGH HE AWARE OF OTHER MEASURES
BEING SET UP BY IMF/IBRD AND OTHERS TO HELP MSA, THERE
SHOULD NOT BE HIATUS BETWEEN EXISTING UNEO EFFORTS AND THOSE
BEING PROPOSED. FRENCH REP SAID OVERALL LEVEL AID AND
DEBT RESCHEDULING HAD INCREASED BY 51.3 MILLION IN FY-75
OVER PREVIOUS YEAR AND GOVERNMENTS WOULD ENDEAVOR PROVIDE
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ABOUT $78 MILLION ADDITIONAL. SWEDEN'SK SPOKESMAN REMINDED
DELEGATES MSA FINANCIAL GAP NOW ESTIMATED BY IMF/IBRD AT
$3.0 BILLION AND SAID SWEDEN WOULD MAKE AVAILABLE ABOUT
$58 MILLION TO MSA'S AS PART CONTINUING EFFORT PROVIDE AID
OF 1 PERCENT OF GNP. NETHERLANDS SAID IT WAS FINANCING
$30 MILLION OF FERTILIZER TO INDIA BUT NOT ABLE TO LIST FULL
COMMITMENTS. NORWAY CITED A GRANT OF $28 MILLION. THE
JAPANESE SPOKESMAN SAID ABOUT $100 MILLION IN AID TO MSA'S
ALREADY WAS UNDER WAY AND ABOUT $74 MILLION MORE WAS TO BE
PROVIDED AS LOANS (WITH GRANT ELEMENT OF 67 PERCENT).
LIBYA'S REP SAID TOTAL OF $155.7 IN AID ALREADY DISPERSED TO
AFRICAN AND ASIAN COUNTRIES INCLUDING CONTRIBUTION AFRICAN BANK.
4. THE USSR DELEGATES, IN COURSE OF LONG LECTURE SAID PLIGHT
OF LDC'S OFTEN STEMMED FROM LINKS TO CAPITALIST SYSTEM, EFFORTS
OF MONOPOLISTS AND TRANSNATIONAL FIRMS TO EXPLOIT FOREIGN
RESOURCES AND REMARKED DEVELOPMENT PROBLEMS EXACERBATED BY
WORLD ARMS RACE (SAID ARMS COST $250 BILLION THIS YEAR
AND NOTED US SOURCE HAD ESTIMATED CUMULATIVE FUGURE
AT $4 BILLION IN 1960'S AND 70'S SOVIET REP
FAVORED CESSATION ARMS RACE AND CUT IN MILITARY SPENDING,
SAID USSR ALONG WITH SOCIALIST NEIGHBORS, HAD INCREASED TRADE
AND IAD WITH DEVELOPING COUNTRIES 17 FOLD IN PERIOD 1950-73 AND
AID TOTALLED 11 BILLION RUBLES.
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ACTION IO-10
INFO OCT-01 ISO-00 AF-06 ARA-10 EA-10 EUR-12 NEA-09 RSC-01
CIAE-00 DODE-00 PM-03 H-02 INR-07 L-02 NSAE-00 NSC-05
PA-02 PRS-01 SP-02 SS-15 USIA-15 AID-05 COME-00 EB-07
FRB-01 TRSE-00 XMB-04 OPIC-06 CIEP-02 LAB-04 SIL-01
OMB-01 FEA-01 MC-02 ACDA-10 AGR-10 STR-04 /171 W
--------------------- 042157
R 051934Z FEB 75
FM USMISSION USUN NY
TO SECSTATE WASHDDC 9056
INFO USMISSION OECD PARIS
USMISSION EEC BRUSSELS
UNCLAS SECTION 2 OF 2 USUN 0384
HE GAVE COMPENDIUM ILLUSTRATIVE SOVIET AID TO LDC'S AND CONCLUDED
WHILE USSR NTO BEAR RESPONSIBLITY FOR MSA PROBLEMS NATIONS WAS
OFFERING EFFECTIVE AID. VENEZUELA PROVIDES $100 MILLION IN AID
OF WHICH $50 MILLION REPORTEDLY PAID. AUSTRALIA PROMISED A
SPECIAL ALLOCATION OF ABOUT $47 MILLION, INCLUDING 100,000 TONS
OF WHEAT. AUSTRALIAN REP SAID THAT AS END OF SYG MANDATE
NEARS, CHAIRMAN AND STAFF TO BE COMMENDED FOR FINE JOB UNDER
DIFFICULT CIRCUMSTANCES. THE GERMAN DEMOCRATIC
REPUBLIC OFFICIAL GENERALLY ECHOED THE USSR LINE INCLUDING
"EXPLOITATION" BY TRANSNATIONAL FIRMS AND SUGGESTED IT WAS
APPROPRIATE FOR EXCOLONIAL NATIONS TO ASK FOR DAMAGES
FROM CAPITALIST NATIONS. THE IRANIAN DELGATE (AMUZEGAR)
NOTED PLEDGES OF $1.6 BILLION IND AID TO MSA'S OF WHICH ABOUT
$886 MILLION WOULD BE MADE AVAILABLE BY JUNE 1975. HE SAID IRAN
ALSO MAKING AVAILABLE AID OF OVER $1 BILLION IN THE FORM OF LOANS
OR GRANTS TO THE IMF ($700 MILLION), IBRD ($300 MILLION) AND
THE UNSYG'S SPECIAL ACCOUNT ($70 MILLION). THE IRANIAN
CITED SPECIAL AID EFFORTS UNDER WAY IN THE IBRD AND IMF AND
CAUTIONED AGINST PROLIFERATION OF AID AGENCIES. CANADA
IN BRIEF INTERVENTION SUGGESTED FUTURE PLEDGES OF FOOD AID
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PAGE 02 USUN N 00384 02 OF 02 052049Z
SHOULD BE MADE BY TONNAGE RATHER THAN MONEY.
6. US SPOKESMAN AMBASSADOR FERGUSON, NOTED US WOULD CONTINUE
MAKE MAJOR EFFORT PROVIDE MSA'S ADDITIONAL AID THROUGH EXISTING
BILATERAL AND MULTILATERAL CHANNELS. WHILE US UNWILLING
PARTICIPATE IN SPACIAL FUND, WHICH MAY BE APPROPRIATE VEHICLA
FOR NEW CONTRIBUTIONS, THIS POSITION NOT AFFECT OUR EFFORTS
FURHER ASSIST MSA'S IN COOPERATION WITH SYG'S EMERGENCY
OPERATION. AS OF FEBRUARY 3 ANNOUNCEMENT, AMBASSADOR STATED,
US FOOD ASSISTANCE UNDER PL-480 IN FY 1975 EXPECTED TO BE
1.47 BILLION IN COMMODITIES PLUS FREIGHT, FOR GROSS
FIGURE OF $1.6 BILLION. THIS AMOUNT COMPATED WITH AID OF
$981 MILLION PROJECTED EARLIER THIS YEAR AND WAS OVER
$600 MILLION GREATER THAN LAST YEAR'S ACTUAL EXPENDITURES.
ESTIMATED THAT WITH THIS BUDGET, US WOULD PROVIDE ABOUT
5.5 MILLION TONS OF GRAIN IN FY 1975 COMPATED WITH 3.3 MILLION
TONS DELIVERED LAST YEAR. BUDGET INCLUDED $655 MILLION
IN FOOD AID TO MSA'S UNDER TITLE I (CONCESSIONAL SALES) AND
A SUBSTANTIAL PORTION OF THE $395 MILLION BUDGETED FOR TITLE
II(DONATIONS). AMBASSADOR OFFERED INFORM YSG OF FURTHER
DETAILS OF PROGRAM WHEN AVAILABLE.
COMMENT: MEETING WELL ATTENDED AND SPEAKERS VOICED CONTINUING
CONCERN WITH PLIGHT MSA'S. ONLY UK INDICATED OPENING TO
CONSIDER EXTENSION OF PREVISCH OPERATION. IN POST - MEETING
COMMENT TO US REP, UK DELEGATE SAID HE THOUGHT
SOMETHING SHOULD BE DONE TO CONTINUE OPERATION OF PREBISCH
STAFF E.G. FOR AID MONITORING FUNCTION, UNTIL SPECIAL
FUND BECOMES OPERATIONAL WHICH IN HIS VIEW WAS A POSSIBILITY.
US DEL INDICATED HE COULD NOT SHARE THIS SENTIMENT AND
THAT WE FELT UNEO SHOULD CEASE ON EXPIRATION ITS MANDATE
MAY 1 DATE TO WHICH PREBISCH HAD REFERRED IN HIS REMARKS.
BENNETT
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