J.Cable, Foreign Office, to All heads of geographical departments, 15 January 1974
Encloses a paper entitled “Potential problems in British foreign policy”, January 1974.
In a section on “types of problem”, five are listed. One is “threats to economic activity, eg, through restrictions on raw material supplies or shipping, the power of multinational corporations or the indebtedness of developing countries”. Others are “threats to facilities” like defence installations, territorial disputes, “threats against persons, property and investments, provoked by political disruption, eg in East Africa or by expropriation of British assets”. In a section called “onerous commitments”, one is “financial commitments, eg to provide 1% of GNP in financial flows to developing countries”. Others are “military commitments” and “administrative commitments”.
Section called “Causes of the problem”, listing four. First is “Nationalism. Most countries in the developing world have recently emerged from being colonies to clients of the major powers. They are keen to assert their national identity and independence in both political and economic contexts… This trend, which shows no sign of weakening, has led, at the political level, to an increase in local disputes, mounting anger at relics of colonialism, especially in Africa, and the urge to re-write the standards of international conduct. In economic fields, the countries concerned are reluctant to conduct business, either domestically or internationally, in accordance with practices and rules largely laid down by the wealthy countries of the west. They may be encouraged to emulate the oil producers, even at economic disadvantage to themselves”. Second is “autocratic regimes”. Third is “The weakness of the West. The ability of Western countries to exercise pressure in the third world is much reduced. Few countries apart from the United States possess the means to impose their will by force, and public opinion in general gives little support to ‘overseas adventures’. Economic pressure, if attempted, often results in greater damage to the sensitive systems of the West than to the subsistence economies of the third world. Although the levers available to Britain will eventually be increased as the result of our membership of the Community, most of these potential problems will occur in area where Community solidarity is not far advanced”. Fourth is “The dismantling of empire. Britain, more than any other western country, is exposed to problems arising from the granting of independence to a large colonial empire. All our major possessions are now independent (except Rhodesia) but those territories that remain pose intractable problems”.
Section entitled “Methods of insurance”, noting three – prevention, disengagement and contingency planning. In the conclusions, notes that “the following groups of problems seem particularly eligible for detailed study: (i) threats to British trading prospects from shortage and high prices of supplies, restrictions on shipping and loss of competitiveness in overseas markets; (ii) the future of British private investment in developing countries, including the link (if any) between treatment of British assets, indebtedness and aid? [sic]; (iii) defence commitments in the Far East and the vulnerable facilities in the Indian ocean required to maintain them; (iv) the problem of successor regimes in East and Southern Africa… and the Persian Gulf”.
Annexes entitled “List of potential problems deserving more attention”. One section is on “Threats to economic activity”. One is “threats to copper supplies from (a) conservation and price-raising measures by main producers (Zambia, Zaire, Chile, Peru)”. Another is “moves by other raw material producers, either industrial or agricultural, to form OPEC-style cartels and to drive up the price by withholding supplies”. Another is “growing influence on international trading of large multinational companies beyond the effective control of governments”. Another is “restrictions on British commercial shipping resulting from… control by developing countries over shipping conferences”. Another is “general increase of indebtedness by developing countries, leading to failure to honour commitments to us when other markets (especially the Euro-dollar market) become tighter”. Another is “problems concerning rescheduling of existing debts to Britain, in particular by (a) Ghana, (b) Indonesia”. Another is “decline in the influence we can exert on Latin America governments on various points which have a cumulative importance for our balance of payments”. Another is “creation of ‘Indian Ocean Peace Zone’ puts Indian Ocean out of bounds to Royal Navy and affects our ability to give the US Navy access to facilities in the Maldives and British Indian Ocean Territory”. Another is “erosion of traditional rules of international law by the efforts of the third world countries to develop ‘new’ law, suing their built-in majority at the United Nations. This includes: (a) reform of the UN charter, (b) the charter on economic rights and duties of states, (c) human rights in armed conflicts, (d) political bias in the International Court of Justice”. Another is “liberation movements in Southern Africa could provoke a number of disputes in the United Nations as follows: (a) recognition of governments in exile, (b) the use of UN funds in support of liberation movements, (c) the use of the ‘uniting for peace’ procedure to legitimise armed intervention or sanctions in white-ruled territories”. Another is “increased pressure to agree to expulsion of Greece, Portugal and Turkey from NATO”. Another is “we may be required to increase government aid, if private investment declines, to sustain our pledge to devote 1% of GNP to financial flows to developing countries”. Other threats are the withdrawal of overflying rights, the revival of some territorial disputes, political pressure on military facilities, defending Gibraltar from attack from Spain and others.
National Archives: FCO49/499