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telephoned her the next day to explain his position, having been alerted to the way in which the press had interpreted his remarks.

At

Continuing, the PRIME MINISTER said that his second point on further reductions of United States forces was more alarming. It indicated that defence expenditure was being driven by budgetary requirements. The CFE process would take several years to implement. For example, over 30,000 tanks would need

be destroyed. It was essential to maintain the NATO defence ructure. President Bush, in a carefully drafted formula, had ed that the United States would keep significant numbers of Med forces and weapons in Europe as long as the NATO Allies wanted this. Under the projected CFE agreement United States forces would be reduced by approximately 30,000 down to a level of 275,000. At the Heads of Government lunch, the NATO Secretary General, Herr Woerner, had urged that no nation should take unilateral action to implement force reductions under a CFE agreement is was right. Some governments wanted to pocket all the drons under the agreement for their own country. Herr Woerner was working out a programme under which the reductions we shared out among all the NATO countries. Brussels Preset Bush had also reaffirmed the United States stand that the son of border changes in Europe should not be discussed. The tian Prime Minister, Signor Andreotti, had strongly supported position. It was noticeable that few speakers had supported the West German Chancellor's remarks on reunification, although Dutch Prime Minister, Mr Lubbers, had not spoken out strogyn the dangers of German reunification. On the other hand, during his visit to Moscow, the French President, M.

s Mitterrand, had moved from his initial position of cautious we me for reunification to a much stronger stand against the concep This change of position undoubtedly reflected not only the outcome of his discussions with President Gorbachev but alapular pressure within France in reaction to his earlier statens

Recent events in East Germany had produced considerable motion both within the two Germanies and elsewhere. This issue now was much more important than Economic and Monetary Union.

State, Mr

This

In a brief discussion, it was noted that was crucial to maintain the present framework of security which allowed the current arms control negotiations to be pursued at a logical pace. The evolution of United States policy we require careful attention. The United States Secretar James Baker, would visit London on 11 December for talks. would be a timely moment to discuss these key question Americans in Malta had been struck by how little President Gorbachev, and the whole Soviet leadership, appeared about the operation of a market economy. President Buch agreed to support the proposal that the Soviet Union she observer status within the General Agreement on Tariffs

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