CONFIDENTIAL
b.
C.
The Americans have pressed us strongly to remain in
Cyprus, and we have told them that in present circumstances we will do so, though at reduced strength. I propose, as an interim arrangement, to reduce our level of
expenditure in Cyprus to roughly one-third of its present level during the course of the coming financial year.
The measurcos we take thereafter will depend both on the
progress of political developments in the island, and on
the outcome of our discussions with the Americans, which are continuing. 7 A separate report to the Committee on the Cyprus negotiations will be made in due course.
The Americans are also anxious about the possibility of
our complete withdrawal, from Oman. Here too it is not
possible to make any long-term plane, although we shall
be reducing our expenditure in Masirah as the staging-post
functions of the airfield themselves reduce.
NATO consultations
PRESENT) BEVÆRDY MATE: ÄTUONNON
G
The formal consultations procedure laid down in NATO on major
policy issues of this sort was meticulously followed. A full
presentation of our proposals was made to NATO at the time that Parliament was informed of them, and ample time with an allowance
for the Christmas break - was allowed for NATO to carry out the
necessary military as3c8oments and the subsequent political consideration of the Alliance's reaction to our proposals.
5. The NATO Secretary General's formal letter to me summarising this reaction is at Annex B. It expresses NATO's "Gympathetic understanding of the economic difficulties which the United Kingdom, in common with other member countries, is now facing", and paya tribute to the important military contribution which Britain now