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commitment of a consultative nature undertaken equally
by all five powers relating to the external defence of
Malaysia and Singapore. We believe that our contri-
bution to the new arrangements will play an important
part in maintaining confidence and stability.
East of Suez: (2) Gulf Policy
14. The Japanese are keenly interested in our intentions
in the Persian Gulf and Mr. Sato will probably enquire
about them. In that event, the Prime Minister could
explain that our aims are to contribute to stability and
to settle outstanding disputes through negotiation.
'These aims should be shared by all countries interested
in the area. We have no wish to maintain a system of
political relationships or a military presence any longer
than wanted. We shall be considering in the light of
Sir William Luce's recommendations, now in preparation,
how Britain can best contribute to peace and stability
in the Gulf.
15.
The smaller Gulf States are not viable in the
modern world. It is essential that they should develop
an effcctive Union of Arab Emirates. This Union
requires support from all quarters.
The Middle East
16. If time permits, the Prime Minister may wish to have
a short discussion about the Middle East. The Japanese
interest, which has been growing rapidly in recent years,
derives mainly from their stake in oil (90% of their oil
comes from the Arab world, mainly the Gulf).
Britain
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