Britain Agrees to Help Foot the Bill : U.S. aid fund: Thatcher, after meeting with Treasury Secretary Brady, says her nation 'would certainly contribute' to the gulf campaign and relief effort.

TIMES STAFF WRITER

The Bush Administration's efforts to persuade major U.S. allies to help foot the bill for the Persian Gulf campaign against Iraq reaped its first modest results Wednesday as Britain agreed to contribute to a U.S. fund to aid Middle East countries hurt by the embargo.

After a meeting between British Prime Minister Margaret Thatcher and U.S. Treasury Secretary Nicholas F. Brady, a spokeswoman for Thatcher said the prime minister had declared that Britain "would certainly contribute" and would announce the amount as soon as it could.

U.S. officials also said that French officials had told them earlier that they would bring up the U.S. request for funds at a meeting of top officials of the 12-nation European Community on Friday. They said the EC also is expected to react favorably to the idea.

The developments came as Brady, accompanied by a delegation of high-level Treasury officials, left Britain and flew to Anchorage, Alaska, en route to appointments Friday with leaders of South Korea and Japan.

President Bush ordered Brady and Secretary of State James A. Baker III to approach America's major allies for financial help, both in underwriting the U.S. deployment and in helping Middle East countries that were hurt by the economic squeeze.

Baker left Washington late Wednesday evening for trips to Saudi Arabia and Egypt before meeting Bush at Helsinki, Finland, for the superpower summit with Soviet President Mikhail S. Gorbachev on Sunday. He later will visit Moscow, Rome and Bonn.

Meanwhile, Treasury officials clarified figures given to reporters on Tuesday on what the Administration wants the allies to pay for the U.S. military buildup in the Persian Gulf.

A senior U.S. official defined those costs as those that go beyond what it ordinarily would cost to maintain those same American forces at their home bases in the United States. They estimate that these would total $6 billion this year and $12 billion in 1991.

The estimate that the Treasury provided Tuesday said the United States was seeking $15 billion by the end of 1990. The Treasury officials also said then that Washington was seeking $10 billion to aid other hard-hit gulf states.

A senior Treasury official said Wednesday that Washington will continue to seek help for gulf states, other than Iraq, that had been hurt by the global economic embargo imposed against Baghdad and will ask the allies to pay all the costs of deploying U.S. troops.

"I think it is not unreasonable to ask the allies to pick up all of it," the senior official said. "After all, they couldn't buy this (military) capability anywhere else in the world, and we have paid for it" with America's investment in a strong military.

"We Americans have a right to expect the (financial) burden to be shared more appropriately," added another senior official. "This is an exercise in which the whole industrialized world is going to benefit."

Top Administration officials indicated that such comprehensive allied financial support could thus ease the budget pressures that are building on the federal government as a result of the massive deployment of American troops in Saudi Arabia.

They said if the allies do agree to pick up the entire military bill, the Pentagon will be better able to forecast its spending needs for the next year. "This burden-sharing will have an impact on the budget," one official said.

The U.S. officials who briefed reporters on Wednesday said Washington believes that the gulf states that have been hurt by the embargo against Iraq--primarily Egypt, Turkey and Jordan--will need a minimum of $3.5 billion in aid this year and $7 billion in 1991.

They said the United States is pushing other nations--notably France--to forgive the military debts owed to them by Egypt, as a sign of support for Egypt's decision to oppose Iraq. Bush already has agreed to write off about $7.1 billion in debt for arms shipments to Egypt.

Top officials also provided the first detailed list of nations that they plan to ask for financial assistance either for the military buildup or for the so-callled front-line states.

Besides France, Britain, South Korea and Japan, that list includes Taiwan, Saudi Arabia, the United Arab Emirates, West Germany, Italy and the European Community as a group. They also will ask the exiled former government of Kuwait to contribute. Kuwait still has large sums in banks.

Because both Britain and France have committed naval forces in the Persian Gulf, Brady did not ask them to help in paying for America's military buildup. Instead, he said, he sought--and won--their cooperation in providing financial assistance for the other gulf states.

But senior Administration officials traveling with Brady said they do expect big financial commitments to cover the military costs from both South Korea and Japan, two of America's most successful economic competitors. Both are heavily dependent on oil from the Middle East.

Brady plans to meet with South Korean President Roh Tae Woo in Seoul on Friday morning and Japanese Prime Minister Toshiki Kaifu later in the day in Tokyo before returning to Washington early Saturday morning.

Japan, the richest of the nations on Brady's itinerary, last week became the first ally to make a specific pledge of financial assistance, when it said it would provide at least $1 billion in aid in the region.

Still, senior American officials indicated they think Japan should provide more help than that.

One official said that the $1-billion figure only represented "a good start" on Japan's part. "We are in a changing world. . . . We have been talking about burden-sharing with Japan and with Europe for a long time," one official said.

Copyright © 2019, Los Angeles Times
EDITION: California | U.S. & World
53°