THE AFGHAN CRISIS: OUTLOOK FOR WESTERN RESPONSES

Created: 1/1/1980

OCR scan of the original document, errors are possible

T

DiKlowit

. . .

1:

;

:

V

.

t'

Outlook for; Western Responses

1 roct Asses

iesearch for this report was completed.}

Mi

assessment was prepared by analyw inffices of Political Analysis and of Economic Research. Questions may be directed to the Chief'Office of Political

j ur iu ihe Chief of theOffice of Economic

m

To

assessment was coordinated svith the National Intelligence Officers for.Polilical-Economy and for Western Europe.

- J-

OaJ3

BLANK PAGE

Western Responses

Iflr w

We believe that Allied nations' response* to Soviet aggression inwill go further than they have to date but that the additional steps will not be taken quickly or match ihose taken by the United States. The British and theCanadians have been most willing to take measures against Iheat others have not followed their lead. With the French unlikely to deviate much from their current hard line onavorable West German stance could be the keyore effective response from other Allies.

Basedeview of countryumber of elements are likely to foster aotf iUorial rj^itical/economicreaterof the constancy of US policy and of long-term USegotiating context inumber of leaders privately agree lo act together;illingness by the United Stales to accept private rather than public efforts on the part of our Allies. "

The Europeans will focus increasingly on combating the potential Soviet threat to the Gulf region *nd South Asia through strengthening the economic and. to some extent, military capabilities of the countries in the region. For the European Communityhis will include greater urgency In talks with Yugoslavia, Turkey, and the Arab states of the Persian Gulf. Wc expect the European nations and Japan to ante up more aid for Pakistan, but commitments to date remain small. While Ottawa hasumber! of other measures, it will have difficulty increasing aid to Islamabad. I

Some Europeans are worried about adverse US reactions to apparent West European coolness to strong actions. They may implicitlyrade-off between an increased willingness on their part to cooperate on anti-Soviet moves and US restraint on imposing economic sanctions against Iran. Such sanctions, they feet, would work to counter the solidarity among the Arab countries needed to combat the Soviet threat in the Middle East. '

Soviel moves to go beyond Afghanistan toward Pakistan or Iran would,create an entirely different situation.int of suchIncrease ail governments' receptivity to direct anti-Sovietwould Soviet attempts to take advantage of uncertainties in Yugoslaviathe event of Tito's death,

l

i

the absence of further expansionist Soviet action, and particularly inof possible reassuring Soviet gestures, the Europeans willincreasing reluctance to close the door on detente even though manyrealize serious damage has been done to the concept. Some, the Frencheumple, may see an even greater need to talk with Moscowmeasures in the context of CSCE (Conferenceand Cooperation in Europe) and an eventual European 1 ,.

ni<rtoscn or harshorthe Europeans andapanese to follow the US lead on direct anti-Soviet measures wouldxacerbate the difficulty of many governments inational consensus on policies to deal with the crisis.urther Soviet expansion of the Af^anbelieve the Allies would eventually feel they were oeing placed in an untenable position between the superpowers. Ultimately, security concerns would probably still require governments to "side" with the United Stales.

Graimlthough our Allies realize the importance of this issue to the United States, the major grain exporting nations probably have already done as much as they will do in support of the embargo. The EC. largely bee* us; of French resistance, is not likely to make permanent the suspension of subsidies on butler sales to the USSR or to hold up sales of poultry and pork. In cases where European and Japanese companies arc attempting to get around the US embargo, individual governments doubtless could be persuaded to intervened

High Technology Exports. As with existing credit arrangements, no COCOM country is likely to move agaiiist ongoing export contracts with the USSR; US pressure on this front most likely .would be futile. All governments willtrict interpretation of existing COCOM

rtttr^lorS, but broadening the restrictions would prove difficult. The French; in particular, are unwilling to stop sales of advanced technology Items for which they have alreadyarket in the USSR. The French Interpret their commitment not to undercut US measures differently from Washington, stressing that French firms remain1 free to[bjd_for_ COTtracis that were still being negotiated with US firhSs.!

erowing tide In favor of boycotting theseveral governments, including the United Kingdom, theCanada, already willing tooycott if the Games cannota boycott should bring most of the

small nations into the fold.

k IV

i

-

W"1

sill

mm

f-"I

(or Wntwn RttpnM* (u>

rnovci would lu decision be reconsidered. Thehowever, said they will draw outtiomew credit agreement and willthe OECD (Organization for Economicand Development) consensus on Interesthas refused to commit itself on strictCOCOM criteria hut has agreed on Ihe principlethsi

mi mnnMm

While promising not to replace contracts previously signed by American companies and advising at least some French firms to go easy on bidding for such contracts, French officials have stressed that France will turn down business cr.ly where sales would strictly replace contracted deals. Concerning Alcoa's breaking off negotiations with Moscowillion aluminum project, for example, the French will almost certainly argue thairench firm (PUK) was alsoor the project and contracts hid not been signed. France's commitment not to replace US goods docs not apply.|

France's overall position on the question of sanctions against the Soviets is clear and firm: it will notarly to economic measures token for political ends. Paris generally has resisted actions that It views as being designed simply to punish the Soviets for their invasion. The French arc no less concerned about the implications of Afghanistan thnn other Westernthey simply see little likelihood that economic sanctionsoycott of the Olympics will in any way influence Soviet thinking. i I. !

i'Ti:

To date, Paris has (a) condemned the Sovietacquiesced In EC technical rules that have atblocked additional exports of ECproducts; and (c) promised tnat French firmsattempt to undercut US economic measures.indicated its willingness toultilateral aideffort for Pakistan but has refusedamounts.

Paris has refused to deny new official export credits, stating that only If ihe Soviets make further hostile

For the moment at least. France appears the least likely of the major Allies to follow the US lead in responding to Soviet aggression or to yield to USey concern for Paris Is maintaining lu foreign policy independence, particularly with ihe campaign already under way for next year'selection. Paris has made it clear that it does not intend to let its policies be dictated by another country, and pressure from the Unitedif madewell harden its stance. At the same time, Paris has avoided criticizing the US position. The French may in fact be pleased that the Unitedirm stand. And. if ihe Afghan sitw;ion developsull-fledged East-West confrontation, there is every reason lo nssumc thai the French would quickly become more accommo-

IS

'"'

Economic ccrotderalton*alsoare Importantrefusal to apply countermcasures. Franceinterested in developing higr^echnologyand has been counting on the Soviet Union asmarket for French electronics, datateleewrurmnicattons equrpnwni||The Frenchcertainty looking beyondto avoid replacing Anwrican suppliespossibility of pickingarge shore of trademight have gone to US

-li'lF

TheSakharov incident may have caused some second thoughts about countermcasures,asic change at this juncture seems unlikely. The. Olympics decision inould prove difficult tochange. In arare display of unanimity, all four major politicalave come outoycott, although some dissenting voices have been heardj K j

Undercurrent circumstances,uch likelierpositively to suggestions that it join In^.: aimed at minimirinc Soviet opportunitieselsewntre in SouthasOut of its desire to avoid portrayingproblem in East-West terms, the Frenchtodiscourage NATO actions of this sort,ad hoc bilateral or multilateralcooperation through the European Community

If Pi

Last October, the Italians agreed in principle to grant the USSR SCO million ia new credits duringeriod, but the Ministry of Foreign Tradeanuary meeting with tbe Soviets to

E

iscuss terms. In addition, Rome claims to be pushingoint EC position on export credits that would .punish the Soviets, either by limiting the credit amounts or by boosting Interest rates. It is not clear what Rome will do if the European Community fails tooint position on this matter. The Italians would resist pressure to formally break creditIn part because of concern over possibleountermeasures. Italy depends on the USSRignificant proportion of its energy needs, j |

Italy

Italian officials have publicly affirmed Rome'ito "total solidarity" with Woihintion in the Afghanistan crisis. However, the Coulgaability to follow through on any tough anti-Soviet countermcasures is limited by the Primetenuous hold on power and Italy's heavy reliance on the Soviets for energy,

Thus far, Italy's response to events in Afghanistan has consisted of:

Supporting Security Council and General Assembly action on the Afghan

Condemning the Soviet Invasion and calling for the immediate withdrawal of Soviet troops.

jRestricting some political, economic, technical, and cultural contacts with tbe Soviets.

ncgotiationswithlheSovicuon new lines of export credits, ijHfjj'i

iCanceling aid to Afghanistan, j ,

, luly's reaction to pressure to adoptountermcasures against Moscow Is likely to vary from

issue to Issue. In general, the oddsesponse would Improve to the extent that Washington

could make guarantees that would cushion the domes-

tie impact of these moves in both economic and

political terms.'

Under US pressure. Rome would likely agreeultinational aid package for Pakistan but would plead poverty (despite the possibilityurrent account surplushen the size of its donation was being determined. The Italians would welcome the chance to sell arms lo Islamabad if payment were financed by the United States.

The government has not yet taken on official position on the Olympic boycott issue, but the Italian Olympic Committee favorseam to Moscow. There seems to be strong, widespread public oppositionoycott of the Olympics, and Cossiga would be hard pressed to meet US urging in this regard unless most other EC countries agreed, j J

In the domestic political contest, the Cossigais extremely vulnerable to Communist and Socialist arguments that adopting retaliatorywould further damage detente and endanger international peace.arliamentary vote ofon Mictions, the almost certain opposition of the two leftist parties could cause the Cossigacollapse. Because of the potential costliness of Italian support, Cossiga probably would need some sort of quid pro quo from the United Suites, such an greater flexibility on the question of Communist

participation In the government.

. I,

II

.f. 1

Ctrmmmllj <; -1 European Community has given assurances it will, uovr directly or inrfircclly to replace Soviethrough denial of US exports. Iatates, the Community has j spenCKO specific subsidies on exports of cereals, At and poultry to the Soviet Unfatiy:UTaken administrative stepsonitorraderder to minimize transshipments to

Curtailed butter and butter oil trade by suspendini be advanced (Ulna of exportJ;:

3RN -hyifr

I porters still can collect subsidies on ules ofprimarily wheat Hour and rye) to ther Communist countries. Barley sales tonion, the major portion of EC-Soviet grainay be reconsidered for specific subsidization in keeping with the concept ofrade patterns. The Community Ucks the power or mandate to control grain products exported without J

Although the EC has expressed support of the US gfaia embargo and Its mechanisms permit control of destination, new sales of at0 tons of EC wheat to the USSR have been reported since the embargo. Whereas export rebate certificates now exclude the USSR, those issued prior to the embargo dnl not. Therefore switching can occur and some traders believe that as muchons of wheat will move to the USSR in this manner.*

The range of further direct EC responses to the Soviet invasion is narrow because of legal limits on the Community's powers. Although the member states may prefer the ECorum for consultations or even joint decisions, the EC as an institution hasew limited powers that ere pertinent. The EC has no power, for instance, to limit any lands of exports to the Soviet Union directly. The powers it has exercised over agricultural trade derivets vast system of agricultural subsidies, which are not duplicated In any other sector. < ^ ,

'rt, - tl

The EC| be farther limited by difference* among thetates. Almost all significant Community act ions are subject to veto by any onemember. Thus the Commission study of exnort credits, for exaiiplc, is unlikely to have any concrete results because of French opposition. Similarly, although the Commission may not resume advanced setting of subsidies on butter exports fora while, the decision ultimately rests with the member states. In any case. US initiatives in any areas of EC institutional competence or active political consultations will be better received if Washington strictly observes the formality of approaching the Community through the Commission and the Presidency country.'

Indirect EC responses through aid and cooperation with threatened countries will be less retrained but of minor impact. Food aid to Afghanistan has been suspended and emergency aid willent to Afghan refugees in Pakistan. Further EC economic aid to Pakistan is possible, although it is unlikely to be substantial. The EC is also moving toward rapid conclusion of an agreement for economic cooperation with Yugoslavia and may now be willing toore favorable association agreement with Turkey.

For the most part, the West Europeans favor the European Communityocal point for cooperative reaction to the Soviet moves because the Community is one step removed from US influence and So cause most contemplated sanctions are economic. Although the West Europeans specificallyirect NATO military response to the Afghan crisis, they 'ccogniie that the Alliance may have to review its defense posture, 1

There is no evidence that the Arghan crisis1 increased Belgian or Dutch willingness lo base new theater nuclear weapons. Belgium may eventually go along, but it will not speed up its review of the deployment decision. In addition, so far there is little evidence that countries presently falling shortercent real growth in defense spending will alter this trend in reaction to Afghanistan. Although most members face domestic opposition to larger military budgets, softeninr economic growth in coming months could change this climate (particularly in London and perhaps

Portugal

Portugal has moved more boldly than almost any other COCOM country lo protest the Soviet invasion of Afghanistan; it has little leverage left except to join in ah Olympic boycott:

jjl 'I ;

The Portugese Ambassador to Moscow has been

i recalled for consultations; Ihc Portuguese charge

i d'affaires in Moscow has said thai relations might

emain at the charge level until the Soviets withdraw

their troops from Afghanistan.

A meeting of the Portuguese-Sovkt Commercial Consultative Group scixduled for this month has been postponed indefinitely, as have ihe meetings of all other bilateral commissions. |

Soviet press and commercial personnel in Portugal are being reduced in number. t. "jj |

i, 'Alt'- f "

Considerationate for thevisit to Lisbon by

Soviet Foreign Minister Andrei Gromyko has been

ostponedfhi*

tipf-|'r:HJf fel'tfUsbon anhbonced onanuary hat it will not signecently negotiated fisheries agreement .with; j

ihrktwM ti mmm

Strict COCOM sanctions would not affect Portuguese interests because advanced technology playsiny role in Portugal's industrial projection and exports The PortuguseGovernment, which hddsa monopoly in foreign trad: in foodstuffs, would neither sell nor divert grain to the Soviet Union. Portugal has never extended credits to the Soviets and. as an aid recipient, is notosition to give aid to Pakistan. Because of long-established policy as well as tactical considerations, Lisbon docs not. however, want to support moves to boycott or transfer the site of Ihe Olympics^ j

The Portuguese Government feels uncomfortable with its strong stand because most other NATOhave not taken similar actions. The opposition Socialists have already attacked the government's "disproportionate" reaction, and thewho accept Moscow's explanation of thehave labeled ihe moves ridiculous formall country. [ [

Greece

imid initial condemnation of Soviet behavior in Afghanistan, ihe Greek Government has concurredumber of US-sponsored anti-Soviet mcasurcsand is disposed to add sonic of its own.I

-;

! 1

In ihe diplomatic am, the Greek* have decided to reduce the number of Sc*n& diplomatic, consular, trade, and media officials in Greece, They have also agreed to undertake several unspecified anti-Soviet econocnic measures, although these atparently will not have much effect on their trade with Moscow which essentially consists of Soviet oil ia return for Greek bauxite, fruits, and vegetables.

: I

So far, the Greeks have been reluctant to boycott tbe Olympics, lo terminate their controversial agreement to repair Soviet naval auxiliary vessels, or to provide Voice of America with additional radio frequencies. They might well reconsider if most other NATO and EC countries follow the US lead and Washington brings strong pressure to bear, particularly ifccompanied by positive induce menommitment to provide greater military aid and support for Greek reentry- military wing of NATO may be necessary to persuade tbe Greeks to abrobate (he ship repair deal or lo provide additional radio frequencies.

L,- Ivlij

Turkey has condemned the Soviet invasion of Afghani-Stan and has not recognized the new Afghan regime, but Ankara has not taken any concrete measures to protest Moscow's behavior. The Turk* have already ruled out economic unctions because they have no economic leverage over tbe Soviets and because they need Soviet oil and economic aid.

At best, the Turks might give rhetorical support todiplomatic actions that appear to entail little cost. They will not consider any ft rooter measures, such as an Olympic boycott, unless such actions are supported by most Allies. Indeed, Ankara now expects tbe United Stales to be more sensitive to Turkey's strategic importance andit recognition of thisd temper US demands on ihe Turks. Ankara could, under extreme diplomatic pressure, undertake selective pr'itical or diplomatic sanctions in returnubstantial Western aid package; even then, the Turks would emphasize national prerogatives and balance commitments to Washington with efforts to mollify the Soviet1

Others

Tbe Benelux countries along with Denmark and Norway have condemned the Soviet aggression but will not get out In front of their EC or NATOn tbe issue of economic sanctions. Denmark and Norway have placed limits on diplomatic, military, and other official exchanges with Moscow but have begged off on unilateral economic restraints. All have pledged to refrain from filling any commercial vacuum created by unctions the United States might impose and will follow decisions made in COCOM, OECD, and, except in the case of Norway, the European Community, on exports and credits to tberactically unanimous Western response would be required to elicit meaningful measures from these smaller Allies:

if pressed, would probably restrict the volume of Soviet trade through Antwerp, one of Ihe largest ports in Western Europe, since this would entail little political or financial cost.ajor grain transshipment point. Close to r> million tons of grain passed through its pons last year, ofillion tons were transferred loihe USSR via small coastal craft. In addition, over the years, Belgium has cut down on the number of work permits issued to Russians to work in tnc country's many Soviet-Belgian firms. The Belgians could be talked into accelerating this trend, which would involve only minimal financial or diplomatic costs for them.

- Denmark does not wish to antagonize the Soviets, who supplyercent of Danish oil, by tampering with present levels of trade.5 million loan to Afghanistan, agreed upons being withdrawn, and the government is likely lo favor aid to Afghan refugees in Pakistan.

considering reducing the number of freight charter flights granted Aeroflot end probably will at least make negotiating procedures more difficult An effort to restrict regularnlikely, however, because it might cause the Soviets lo cancel iheir contract to boy Luxembourg steel.

fill

h* dM to be cto^ fnxri joiningbar, on Sonet fjcing. inyinfi thai sackmore could ru nher complicate tbe delicate Soviet-Norweiianegotutions on tbe Barents Sea economic zone arid elTorU to work around conflicting Interpretation! of tbe Svaibardsbingo could be counterproductive since roost species spawn la Soviet waters, whereow limited for conservation

Holland hasrceac on government and cultural contracts with the Soviets. The Hague may move further and attempt to gain EC support for holdingsales of grain substitutes. Although opinion had beengainst aa Olympic boycott, the Sakharov case has apparently reversed tbe trend. Spokesmenajority of the parties iaincluding the governing Christian Democrats and Liberals, are now demanding aa unconditional boycott. Tbe Dutch Cabinet has followed nit and advised the Dutch Olympic Committee to boycott tbe Moscowfk11ill

. ii!<

I!

iiiiat'

m

m

-i

: j)

it'-.

Original document.

---

---