In preparation for the Ministerial meetings of the NATO Council on July 16, we have reviewed the information available to us on the probable course of the "Summit" talks which are to commence in Geneva on July 18 and have attempted to formulate, for your consideration, what might be the Canadian attitude towards the talks and towards some of the principal proposals likely to be discussed.

2. In the process of trying to clear our own minds we have found that the different Divisions concerned (and we have not yet sought the views of other Departments) hold divergent points of view. We can therefore sympathize with the difficulties of the Western participants which may account for the paucity of information we have been able to extract from them on the substantive questions of Germany and European security.

3. The Western powers, including Canada, are it seems to me, in a dilemma. We wish to seize the opportunity, which our policies have largely created, to negotiate with the USSR to relax tensions and to reduce the threat of a nuclear war. This is stating the objectives of the negotiation in the Soviet cliché but there is some evidence that the Russians at last mean business. If they do not, there is no problem, apart from making this apparent to public opinion. But if they do they will ask a price for any concessions they may offer. Our dilemma is: are the Western Powers prepared to pay their price if they are prepared to pay ours?⁷² Can we afford to pay? If not, can we afford to turn down their offer without making some counter proposal?

4. Since the end of April, the United Kingdom, United States, French and German Governments have been seeking the answers to these questions. The only official study we have seen is the report (copy attached) of the tripartite working group of officials which met in London before the last Ministerial meeting of the NATO Council last month.⁷³ Although the first third of that report deals with the form and timing of the Western invitation to the USSR, the remainder is still of interest. It analyzes in turn the various possible Soviet moves in Europe and outlines the attitude the Western Powers might adopt to each, including the broad lines of some possible Western initiatives and counter proposals, though these are not elaborated.

5. Although the London working group was not reconvened, tripartite preparations have continued, chiefly in Washington, where an informal working group was formed earlier this month. The official working group will reconvene in Paris on July 8 to review the findings of the Washington group and of tripartite groups of experts now meeting to examine particular aspects of the problem in the following places:

We have as yet very little information about the work of the first two.

6. Since you left Ottawa, we have, however, received full reports? (attached) from Mr. Johnson and Mr. Heeney on the meetings of the three Foreign Ministers in New York on June 15-16. In the past few days, we have also had valuable reports? (attached) from our Missions in London, Bonn, and Paris on current thinking in their capitals, although you may have had more recent information from the Foreign Ministers themselves in San Francisco.

7. Added together, these reports begin to paint a coherent picture. The Western Powers foresee a long series of high level negotiations. After four to six days at Geneva in July to launch the talks "at the summit", to present general views on the causes of international tension and to explore tentatively any proposals advanced, the four Foreign Ministers will resume negotiations in September or October, after Chancellor Adenauer's visit to Moscow; depending on progress made this year, there might be another high level meeting some time next year.

8. The Russians, on the other hand, appear to be in more of a hurry, as their handling of the Austrian Treaty, the Belgrade visit and their invitation to Adenauer show. Yet they have made it quite plain publicly and privately that they are no more ready than are the Western Powers to give something for nothing or to discuss the liquidation of their position in Eastern Europe.

9. At Yalta and Potsdam, the Powers were under compulsion to agree. They did what they thought it was necessary to do to maintain the unity to win the war. There is no such urgency today. On the other hand, the Russians, for their own reasons, seem in a mood to negotiate. With the Paris Agreements ratified,⁷⁴ the West is not only morally bound to make the attempt but for a variety of compelling reasons - political, military and economic - a serious effort should be made this year to make the shift from cold war to cold peace. Looking ahead, it seems to me unlikely that the West will be in a relatively better position to negotiate with the Russians in the foreseeable future. Therefore the Western Powers must do more than go through the motions. We must recognize and accept the opportunities and the risks which real negotiations entail.

10. It is becoming apparent that this attitude is shared more fully in London and Paris than in Bonn or Washington. No doubt we can all subscribe to the terms of the joint declaration, released after Chancellor Adenauer's visit to the President, that neither neutrality nor neutralization is a possible solution for Germany.⁷⁵ At San Francisco, Mr. Pinay added his "Amen". A neutral Germany free to rearm without controls or limitations could become a menace, while neutralization by outside powers is a solution no self-respecting German could stomach.

11. Moreover, although this point is not made from the roof-tops, a neutral or neutralized Germany would mean a Germany out of NATO which might in turn mean North American troops out of Europe. Although this would not necessarily follow, it would radically alter the political character and military dispositions of NATO.

12. On the cardinal points there is agreement among the three powers that: Western security arrangements must be preserved; the Paris Agreements are not negotiable; Germany cannot be neutralized; a balance between Soviet and Western strength in Europe must be preserved; the legitimate interests of all NATO and WEU countries must be respected.

13. It is, however, recognized in the capitals of Western Europe that, precisely, because the Paris Agreements are not negotiable, the German question is probably insoluble except in the context of some European or still wider security system. For years this has been the refrain of both Chancellor Adenauer and the Socialist opposition in Germany. The French have always linked the problem of Germany with disarmament; and in the Malik Plan presented to the Disarmament Sub-Committee in London early last month the USSR also linked the solution of the two questions so directly affecting their security.⁷⁶ In his private conversations in Paris and San Francisco, Mr. Molotov showed more interest in a European Security System and disarmament than in German reunification. As Lord Hood said in briefing old Commonwealth representatives in New York, the Russians cannot conceive of German reunification except in a setting of European security, and the West cannot conceive of European security without German reunification.

14. The Eden Plan with technical embellishments, will probably be the Western starting point at Geneva.⁷⁷ (A summary? is attached for easy reference). It makes no provision for a security system into which a united Germany could fit. This gap in the Western position led to criticisms at the time of the Berlin Conference and it is legitimate to expect the Western Powers to do something to fill it at Geneva. The difficulty is to agree on what could be done.

15. Of the possibilities discussed very tentatively by Lord Hood and by the tripartite working group, we are interested in the following elements:

(a) a Five Power Mutual Assistance Treaty in which the four powers and Germany would renounce the use of force for settling territorial claims, etc. and would pledge each other assistance in case of an attack by another signatory;

(b) a European Security Treaty which

(i) would provide for consultations in the event of an attack on any of the parties in Europe;

(ii) would limit and control all conventional armaments and armed forces in Europe, including non-European forces in Europe (Soviet, U.S., British and Canadian) but which would not include forces or arms in the USSR or in the United Kingdom or North America; and

(iii) would establish certain demilitarized zones (the Eastern Zone of Germany has been suggested by Mr. Van Zeeland).

16. A five power pact, as outlined in (a) above, could be invoked in the case of a German attack on the USSR, or vice versa, but only the consultative procedure of the general European Security Treaty would operate if Russia or Germany attacked Poland. Both pacts assume that frontiers are recognized, which they are not; and both might extend the commitments of the Western Powers in Europe and might prejudice NATO arrangements.⁷⁸

17. At the same time, if the USSR is looking for some legitimate reassurance (in addition to the unilateral guarantees of the Paris Agreements) that German rearmament will not get out of control and will not be used for revanchist adventures eastwards, some such combination of a regional Locarno-cum-disarmament might be attainable without either breaking up NATO or leaving the West in a relatively weaker position militarily on the Continent.

18. For some time the Germans have contemplated a European Security System as the road to reunification. Chancellor Adenauer has spoken publicly of W.E.U. as the vehicle for this system - a W.E.U. extended to include the satellites (and perhaps the USSR), or in treaty relations with the Warsaw Pact countries. The tripartite working group came down against any NATO-EETO pact as perpetuating the division of Europe and confirming the Soviet grip on the Satellites.⁷⁹ Such objections are however on a different scale if it should ever prove possible to get a European disarmament scheme into effective operation.

19. The Western prerequisite to a European Security System should clearly be the reunification of Germany. The question of German neutrality we have already discussed in an earlier paper (of June 7)?, concluding that neutrality was an unacceptable solution and that a well thought out European security system offered a safer approach to the problem of German reunification.

20. On the Soviet side, a withdrawal of the bulk of foreign forces from Germany is at present a prerequisite for all-German elections. Indeed it is hard to see how the USSR could agree to any European Security System without at least a partial withdrawal of United States forces from Germany. There might however be room for manoeuvre here based on a slow and partial withdrawal over a period of time.

21. Another factor in our negotiating position is that, through the Eden Plan, the Western Powers have already offered a reunited Germany the opportunity to "opt out" of NATO. From the tripartite consultations it seems reasonably certain that the Western Powers will stand by their offer and run the risk (which is a real one) that the Socialists might win all-German elections and leave NATO or substantially reduce their military undertakings under the Paris Agreements. Because the risk is real, the Eden Plan must have some attractions for the Russians, even at the cost of the liquidation of communism as an effective force in East Germany. (By the same token, one of the first conclusions we reach in our own thinking is that NATO must be made as attractive a club as possible for the new German member. The directors of the Club must not hesitate to do all that they reasonably can to promote the chief interest of the Germans, the unification of their country. It must be made apparent to the Germans that the Atlantic Club is not just a militaristic substitute for the "European idea").

22. Although any Soviet demand for a reunified Germany to withdraw automatically from NATO will be rejected by the Western Powers without embarrassment, it might not be so easy to handle a Soviet offer to accept the Eden Plan provided most foreign forces were withdrawn before the elections (so the elections would not be influenced by their presence) and both East and West German Governments were to withdraw before the elections from EETO and NATO, reserving the right of an all-German Government to choose its alliances subsequently. We would expect such an offer to be rejected by the West; but it would be bound to have a strong appeal in Germany.

23. We are now working on a list of Canadian criteria which could be used in approaching the complex problems which will arise at Geneva and hope to have it ready for discussion at the meeting next Friday.⁸⁰

J. L[ÉGER]