Foreign Relations of the United States, 1969–1976, Volume XLI, Western Europe; NATO, 1969–1972

339. Memorandum From C. Fred Bergsten of the National Security Council Staff to the President’s Assistant for National Security Affairs (Kissinger)¹

Washington, March 16, 1971.

SUBJECT

• Agreement on U.K. Grain Import Policy

We reached ad referendum agreement with the British at the end of last week on an acceptable compromise over the new U.K. grain import policy.

Following the President’s decision, the U.S. delegation got a significant improvement over the most recent British offer:

1. Elimination of the tariff on grain sorghum, a rapidly growing item in U.S. shipments to Britain.

2. Total exemption from import levies of corn for industrial purposes, which represents ⅓ of the U.K.’s total corn imports (corn is 90% of our grain exports to Britain).

3. Slightly lower minimum import prices, and hence a reduced likelihood of triggering the levies at all.

4. Exemption of U.S. exports from any import levies triggered by EC export subsidies.

5. Indefinite duration for the agreement, denunciation rights on short notice by either side, and explicit maintenance of our GATT rights.

The negotiators also agreed on the general text of statements to be issued by both the U.K. and the U.S. Governments. The British hope that any problems can be worked out to allow simultaneous announcement tomorrow.²

I believe that the results clearly demonstrate that we handled this issue just right. The President made precisely the right decisions—per my recommendations, through you in January and through Peterson more recently—to negotiate further with the British in the hope of obtaining an arrangement which would be defensible before our agricultural community, but to avoid a confrontation with Heath in the process, à la Hardin’s proposals. Phil Trezise and Clarence Palmby did a skillful negotiating job in obtaining further concessions, even though they had to accept whatever they could get. We thereby avoided what could have become a very bitter Anglo-American dispute, as well as preserving all our economic rights for the later battle with the EC where they will really matter.

1. Source: National Archives, Nixon Presidential Materials, NSC Files, Box 728, Country Files—Europe, United Kingdom, Vol. V. No classification marking. Sent for information. Initialed by Kissinger.
2. Heath announced the agreement in a parliamentary statement of March 18. The U.S. announcement was made on March 17 by Hardin and Peterson. Subsequently, on April 6, Nixon sent Heath a message citing the Prime Minister’s parliamentary declaration in order to place the U.S. statement on the same level as the British. The text of the Heath statement, a March 25 memorandum from Kissinger to Nixon outlining the reasons for a Presidential message, and a copy of the April 6 message from Nixon to Heath are ibid., Vol. VI.