Memorandum, State Department Summary of Telegrams

DECLASSIFIED OFFICE OF E.O. 12065, Sec. 3-402 THE SECRETARY OF STATE State Dept. Guidelines, March 6, 1982 WASHINGTON By DEB NLT, Date 9-4-85 March 4, 1952 SECRET SECURITY INFORMATION SUMMARY OF TELEGRAMS FRANCO-GERMAN Embassy Paris reports the news that Germany has RELATIONS filed a complaint in the Council of Europe regarding the Saar has come as a disappointment to the French Foreign Office which hoped an open clash could be avoided. The Foreign Office has surveyed all on-Communist groups in the French Assembly and has found it would be backed without question if it made a sharp rejoinder. Obviously this would whip up public opinion in France and the Foreign Office is well aware of the bad effect this could have on the entire European policy of the French Government. Although no decision regarding French action has yet been made (and it presumably would have to await the formation of a new Government) the tendency is to take a procedural approach and refuse to discuss the matter in the Council of Europe. A German representative has recently discussed again with the French the possibility of a "European" solution to the issue. However, the Foreign Office has concluded that the Germans are not really interested in a European solution but intend to press for nothing short of reintegration of the Saar into Germany. They believe an interim solution on a European basis would be regarded by the Germans only as a way station on the road to full reintegration. IRAN Mr. Prudhomme, the representative of the International Bank who is returning to Tehran for further negotiations on the oil problem, has informed Embassy London that the British position is basically unchanged. Anglo-Iranian - Oil Company representatives are of the opinion the situation is developing in a favorable direction. Company officials expressed belief that the firm US attitude in respect to the Iranian request for financial aid had had a most beneficial effect. The Foreign Office has shown no disposition to retreat from a legal position, although Prudhomme can tell the Iranians such matters as compensation, blockade, and the International Court of Justice case could be worked out satisfactorily if an agreement is made with the Bank. Prudhomme intends to tell the Iranians that as a result of the con- versations in London, the Bank sees possibilities of an agreement which the SECRET SECURITY INFORMATTON