!

next three-year forecast, due on 1 April 1975, it would

not have to be presented as a major change to the present

forecast, and the ground for argument would be reduced in

scope.

7. On past form Mr. Mintoff can be expected to oppose

strenuously and noisily any reductions, but with a vigour

roughly related to their severity. NATO is unlikely to welcome,

in conjunction with our other proposals, cuts which could

provoke Mr. Mintoff into very sharp opposition. Therefore it

might be unwise to attempt, in an effort to minimise the cost

to us of Malta, to cut our presence too savagely, unless we

were prepared to stand quite firm in face of Mintoff and NATO

opposition, and put up with any retaliatory measures Mr. Mintoff

might use against us.

8. Unless Ministers felt that we should take that stand, and

be prepared, as we have nearly done before (but with NATO on

our side) to move out completely if necessary, it would be better

not to risk an ignominious retreat before Mr. Mintoff. In these

circumstances it would be preferable to take as our starting

point no significant reductions until 1977/78, and a progressive

run-down during the final two years of the agreement. We shoulä

in negotiation no doubt be pressed to delay this run-down as

late as possible. As the period becomes shorter, the room for

concessions, and hence for embarrassment, is sharply reduced.

SECRET

19.

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