THE PRESIDENT'S DAILY BRIEF 25 OCTOBER 1974

• Document Type: FOIA
• Collection: President's Daily Brief 1969-1977
• Document Number (FOIA) /ESDN (CREST): 0006007851
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 14
• Document Creation Date: August 14, 2016
• Document Release Date: August 24, 2016
• Publication Date: October 25, 1974

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The President's Daily Brief
October 25, 1974
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Exempt from general
declassification schedule of E.O. 11652
usemPtion categorY 5130
declassified only on approval of
the Director of Central Intelligence
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FOR THE PRESIDENT ONLY
October 25, 1974
Table of Contents
France: Giscard announces energy policies. (Page 1)
USSR-Australia: Soviets buy 1 million tons of wheat.
(Page 3)
USSR-Syria:
(Page 4)
Palestinians: Arab foreign ministers stymied over
Jordan-PLO issue. (Page 5)
Notes: USSR-Egypt; West Germany; Venezuela (Page 6)
Annex: Arab Summit Meeting
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FRANCE
French President Giscard d'Estaing
called during a press conference yester-
day for representatives of the principal
oil exporters and importers among indus-
trialized and developing nations to meet
early next year to discuss energy matters.
He suggested that the conference be
limited to 10 or 12 nations.
Giscard reiterated his hope that the EC will
speak with a single voice on energy matters and said
France will not join the US-sponsored Energy Coordi-
nating Group. He added, however, that France would
not obstruct efforts to create a new international
energy agency within the OECD. Despite Giscard's
denial, his call for a "restricted" energy confer-
ence is intended to steal a march on the more delib-
erate strategy behind the Energy Coordinating Group's
activity.
Giscard proposed that his conference consider
guarantees of the income of oilexporters, "which
might consist of pegging the level of oil prices to
the level of economic development and set up the
threshold at which the guarantees would be applied."
It is not clear how the French intend such a system
to function. Paris clearly hopes that it will appeal
to both the oil importers--looking for lower prices--
and the producers--who have spoken of linking their
prices to inflation.
An inducement for EC support of the conference
is contained in Giscard's suggestion that the Nine
could have a single representative speak for the
Community. France's boycott of the energy group
within the OECD assures that the EC as such cannot
be represented in that body.
Giscard also called on his EC partners to join
him at a summit meeting in late November or early
December to discuss "medium-range" planning for the
EC's future. He has been known to want such a meet-
ing before France's term as EC president expires at
the end of the year.
(continued)
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The French President also discussed the situa-
tion in the Middle East. He said the world community
should recognize the Palestinians'. .right to a home-
land and added that international negotiations should
work toward that goal, as well as "recognized and
secure frontiers" for Israel.
France supported the UN resolution to allow the
PLO to speak during the General Assembly debate on
the Palestinian issue, but it has not recognized any
group as sole spokesman for the Palestinians. For-
eign Minister Sauvagnargues has just returned from
Jordan and Lebanon?where he met with PLO leader
Arafat--and will soon visit Israel.
Turning to domestic matters, Giscard said he
plans to meet soon with leaders from all hues of the
French political spectrum to discuss his. coming sum-
mit meetings with his EC partners, President Ford,
and Soviet party chief Brezhnev.
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USSR-AUSTRALIA
Moscow has made a cash purchase of
1 million tons of Australian wheat, worth
$150 million, for delivery through August
of next year. Australia's wheat harvest
will not begin until December, but an ex-
cellent crop is expected; Australian wheat
exports should total about 8 million tons
in 1975.
The purchase from Australia brings the total of
confirmed new Soviet grain contracts for fiscal 1975
to about 2.5 million tons of wheat and 1.5 million
tons of corn. The Soviets began this new round of
buying in Argentina in mid-September with the pur-
chase of about 500,000 tons of corn and 250,000 tons
of wheat. This was followed in early October with
their effort to buy 3.2 million tons of US grain,
reduced to 2.2 million tons following Secretary
Simon's visit to Moscow.
now
The buying began just as the USSR's harvest was
concluding. The Soviet target was 205 million tons,
but the Soviet press reported that harvesting was
slowed by poor weather and that the corn crop was
less than expected. Moscow has not yet published
an official estimate of the grain harvest, but unof-
ficial estimates range from 190 to 210 million tons.
Our last estimate, as of two weeks ago was 195 mil-
lion tons,
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USSR?SYRIA
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ARAB SUMMIT MEETING
Arab foreign ministers meeting in
preparation for the summit conference that
begins Saturday reached a stalemate last
night trying to reconcile the negotiating
positions of Jordan and the Palestine Lib-
eration Organization.
A PLO spokesman charged at a news conference
that the foreign Ministers had greeted all PLO de-
mands with opposition or "total silence." In re-
sponse to a leading question, he said that a PLO
walkout is a possibility. The PLO has been demand-
ing that its status as "sole legitimate" representa-
tive of the Palestinian people be reaffirmed.
Jordan and some Of the other Arab states are
objecting to this as posingan impediment to Jordan's
right to negotiate for the West. Bank. According to
an Egyptian news service, the foreign ministers,
having failed to resolve the impasse, are now in-
clined to leave it for their leaders to work out at
the summit.
A PLO walkout is, in fact, Unlikely. The threat,
and the fact that the organization publicly aired the
deadlock, may simply be tactical moves designed to
dramatize the Palestinian position and wring as many
concessions as possible from the other Arab states.
Although the publicity could limit PLO Chairman
Yasir Arafat's options, he may prove to be a more
tractable negotiator than his deputies. Moreover,
the leaders of the states most directly involved--
Jordan, Egypt, and Syria--are somewhat more flexible
than their foreign ministers and may at least be more
willing to attempt an accommodation.
At Annex, we discuss the issues at stake during
the Arab summit meeting.
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NOTES
ussR-Egypt:, A senior Egyptian official has told
US representatives. in Cairo that, except for the an-
nouncement that BrezhneV will visit Cairo next Janu-
ary, no agreements were reached during Foreign Min-
ister Fahmi's visit to Moscow last week. The Soviets
said that negotiations for further Soviet aid could
proceed, but that no final agreements will be Con-
cluded until Brezhnev's visit.
West Germany:
Venezuela: US iron ore concessions are sched-
uled to be nationalized by December 9, but the gov-
ernment plans a one-year period of transition before
the take-over is completed. The amount of compensa-
tion has yet to be agreed.
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ARAB SUMMIT MEETING
The Arab summit meeting scheduled
to convene in Rabat on Saturday will
deal chiefly with the question of how
to accommodate both Jordan and the Pal-
estine Liberation Organization in peace
negotiations. Principal Arab leaders
may also discuss the pace of negotia-
tions, particularly whether to proceed
by stages or shortly to resume plenary
sessions of the Geneva conference.
The Palestinians and Jordan
President Sadat essentially wants to obtain from.
the summit Arab recognition of Jordan's role as nego-
tiator for the West Bank. At the same time, he seeks
to give the PLO a kind of standing that will put it
on an almost equal footing with front-line Arab
states and that will offer at least a long-range-hope.
that the Palestinians will obtain satisfaction from
a negotiating process.
Sadat's tactic so far has been to play with words,
first withholding and then conceding the label of
."sole legitimate representative" accorded the PLO at
last year's Arab summit. He has held to his basic
strategy on the central issue--that no matter what
label is given to either party, Jordan must initially
be accorded the right to negotiate for .the West Bank
if there are to be any negotiations at all.
Sadat will continue this line at the summit,
hoping that appeals to "realism" and some semantic
maneuvers will induce all parties to be more flexible.
The recent vote by the UN General Assembly to permit
the PLO to participate in assembly debate on the
Palestinian question should assist Sadat's effort.
Also of some help is the joint Egyptian-Soviet state-
ment issued last week. This statement called for an
independent PLO delegation at Geneva and affirmed the
Palestinians' right to establish a "national entity."
Sadat can point out that the international rec-
ognition for the PLO implied in the UN vote and in
the Egyptian-Soviet statement is a kind of guarantee
that turning actual negotiations over to Jordan will
not mean either abandoning the Palestinians or
denigrating the PLO. Egypt's lobbying for the UN
vote and its support for the Soviet statement, more-
over, enable Sadat to argue with the PLO that Egypt
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is really backing the Palestinians for the longer
haul and is currently supporting Jordan only as a
tactical move.
The main obstacle to Sadat's strategy is less
the PLO itself than the attitudes of the PLO's sup-
porters--Algeria, Kuwait, Iraq, and Syria. Algerian
President Boumediene, in particular, could lead a
stampede in favor of the PLO and against Jordan,
drag the Saudis and Syrians along, and encourage the
PLO to press for its maximum position. This would
wreck Sadat's balancing act and with it his 'hopes of
fielding a united Arab negotiating team in the next
round with the Israelis and eventually at Geneva.
The Politics of * Economics.
The Arabs' key position in international eco-
nomic affairs and the political ramifications of this
role presumably will be a major topic of discussion,
but the conference is not likely to make any decisions
on the substance of oil policies. The oil producers
comprise only a quarter of the membership of the
Arab League, and they will not readily submit the
essentials of their oil policies to discussion by
their poor relations.
Egypt's recent propaganda on the oil price ques-
tion probably typifies the sort of noises the Arabs
will make at the summit. Egyptian media claim that
predictions of economic chaos are exaggerated, and
that criticism has been unjustly centered on Arabs,
rather than on all oil producers, as part of a
"Zionist-inspired" propaganda campaign. Although..
the Egyptians righteously portray the Arabs as eager
to avoid economic chaos, Cairo emphasizes at the
same time the Arabs' capability for causing dis-
ruption and their "right" to do so if political
necessity dictates.
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One specific area of economic cooperation that
will be discussed at the summit is assistance to
Africa. Many of the Africans severed relations with
Israel last year, and the :Arabs have been under con-
siderable pressure from African states to relieve the
effects of high oil prices as a quid pro quo. Last
year's summit established a relatively small assist-
ance fund, under which disbursements are now being
made., Although this year's meeting doubtless Will
continue the fund, no substantial increase is likely,
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