TNAG-2224-FCO40-3195-Gulf-War-burden-sharing-Hong-Kong-contribution-1991 — Page 161

CONFIDENTIAL

q

165667

MDHIAN 1121

HKB 020/3

CONFIDENTIAL

FM WASHINGTON

TO IMMEDIATE FCO

TELNO 271

OF 282335Z JANUARY 91

INFO IMMEDIATE RIYADH, JEDDA, MODUK, TREASURY, CABINET OFFICE, ACTOR

SIC

MODUK FOR SEC(O) (C), POLAD HIGH WYCOMBE, HQBFME (FOR ABBOT)

TREASURY FOR PS/CHANCELLOR

JEDDA FOR BLACKLEY

RIYADH TELNO 272: IRAQ/KUWAIT: BURDEN-SHARING

SUMMARY

1. FURTHER PLEDGE, FROM SAUDI ARABIA, OF DOLLARS 13.5 BILLION (BRINGING US TOTAL PLEDGES FOR THIS YEAR TO DOLLARS 36 BILLION).

DETAILS APPARENTLY STILL UP IN THE AIR. ADMINISTRATION NOW

ESTIMATE COST FOR FY91 TO BE BETWEEN DOLLARS 60 BILLION WITH

CONTRIBUTIONS OF DOLLARS 45 BILLION ANTICIPATED.

CASH CONTINUES TO TRICKLE RATHER THAN POUR IN.

DETAIL

BUT ACTUAL

2. FOLLOWING THE KUWAITI ANNOUNCEMENT OF A CONTRIBUTION OF DOLLARS 13.5 BILLION TO OPERATION DESERT STORM ON 25 JANUARY, BAKER ANNOUNCED ON 26 JANUARY THAT SAUDI ARABIA WOULD BE MATCHING THE KUWAITI OFFER, THEREBY BRINGING CONTRIBUTIONS SO FAR TOWARDS US COSTS FOR THE FIRST THREE MONTHS OF 1991 TO DOLLARS 36 BILLION (KUWAIT 13.5 BILLION, SAUDI ARABIA 13.5 BILLION, JAPAN 9 BILLION). THIS ASSESSMENT WAS UPDATED BY THE WHITE HOUSE SPOKESMAN ON 28 JANUARY WHO, IN DRAWING ATTENTION TO A WALL STREET JOURNAL ARTICLE OF THE SAME DATE QUOTING DARMAN (OMB), CONFIRMED THAT THE ADMINISTRATION WAS NOW WORKING ON THE ASSUMPTION OF A SHORT FALL OF DOLLARS 15 BILLION BETWEEN COSTS (DOLLARS 60 BILLION) AND ANTICIPATED CONTRIBUTIONS (DOLLARS 45 BILLION).

3 =

WE HAVE DISCUSSED THE LATEST SAUDI PLEDGE WITH ADMINISTRATION OFFICIALS. THEY TOO HAVE TOLD US THAT THE DETAILS OF THE ARRANGEMENT HAVE NOT BEEN FINALISED AND THAT THEY MIGHT REMAIN UNRESOLVED FOR SOME TIME YET, GIVEN THE STRONG POSSIBILITY THAT HOST NATION SUPPORT WOULD CONSTITUTE A SIGNIFICANT PROPORTION OF THE EVENTUAL SAUDI CONTRIBUTION. THESE SAME OFFICIALS WENT ON TO CONFIRM (TOKYO TELNO 71)

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CONFIDENTIAL