G-7 Nations Agree on Anti-Terrorism Steps

The leaders of the seven largest industrial democracies on Friday agreed to a U.S. proposal to launch a concerted drive against terrorism by embracing 40 measures intended to restrict the global movement and financing of terrorists.

While they signaled the leaders’ resolve, some of the recommendations were as general as a commitment, without details, to “combat the spread of international firearms trafficking” and to “cooperate” in money-laundering investigations.

And the leaders were forced to paper over objections--raised by Canada and the European nations--to a U.S. effort to block trade with Cuba as well as Libya and Iran, two nations the United States says play central roles in supporting Middle East terrorism.

Further differences emerged when the so-called Group of 7 leaders failed to get unanimous approval for a plan to help the world’s poorest nations emerge from staggering international debts. The leaders did approve a $2-billion expansion of the World Bank’s aid program, but Germany balked at a plan to sell a portion of the International Monetary Fund’s gold reserves to finance debt relief.

Still, they remained united in their longer-range, common objective: seeking sustainable, steady economic growth and finding measures to reduce international tensions.

During the first full day of their two-day annual summit, the G-7 leaders managed to agree on the 40 points to guide counter-terrorism efforts, adopted after Tuesday’s bombing in Dhahran, Saudi Arabia, that took the lives of 19 Americans at a U.S. military housing complex.

The White House announced that, after the summit ends this afternoon, President Clinton will have dinner with French President Jacques Chirac in Paris, then fly to Florida to attend memorial services Sunday at Eglin and Patrick Air Force bases, where most of the dead had been based.

The anti-terrorism recommendations include: assuring speedy extradition; attacking terrorists’ resources by encouraging state confiscation of proceeds from criminal operations; protecting national borders against the spread of firearms; and countering the use of high technology in criminal activity. The United States recommended that the measures be implemented by the next G-7 summit, in Denver in June 1997.

The elements to which the summit participants--later joined by the prime minister of Russia--agreed, “are generally technical,” said Daniel Tarullo, the White House official who served as the chief U.S. representative in preparatory work sessions. “They are not big-picture things. The idea was to get beyond generalities to specific stuff that would matter on the ground.”

But whether any of them would have headed off the most serious terrorist incident in the United States, the bombing of the Alfred P. Murrah Federal Building in Oklahoma City on April 19, 1995, remained unclear.

The seven leaders--from Britain, Canada, France, Germany, Italy, Japan and the United States--spent much of the day around a 50-foot blond-wood oval table in a nearly bare-walled conference room of the Museum of Modern Art in Lyons’ Parc de Tete d’Or, a sprawling--and on Friday, sun-draped--garden on the banks of the Rhone River.

In one area of agreement that senior U.S. aides portrayed as significant, the group set a course intended to establish greater control over international financial transactions to prevent violations such as those that plagued the Japanese giant Sumitomo and Britain’s Barings investment house.

Nevertheless, statements of summit participants and aides, as well as the written documents they issued, signaled carefully crafted efforts to mask their differences.

Reflecting the deep divisions that often occur when the search for a common policy interferes with business interests, they papered over differences stemming from the U.S. campaign to cut off trade with Cuba, Iran and Libya.

“A rap on the knuckles for the United States” was the way a European Union official characterized the G-7’s communique language on the subject.

“I don’t think that economic reprisals are the most effective way to combat terrorism,” Chirac said at a news conference. “We have to judge case by case, but it isn’t very nice to take entire peoples hostage.”

The dispute is centered on U.S. legislation, taking effect Aug. 1, that will pressure other nations to cut off trade with Cuba by, for example, denying foreign companies’ executives entry to the United States if their firms make use of property in Cuba expropriated from Americans decades ago. The law was passed in the wake of the Cuban downing of two small civilian airplanes flown from Florida to airspace near Cuba in February.

Similar legislation aimed at Iran and Libya, which is facing final approval by the House and Senate, has also drawn sharp criticism from some of the United States’ major trading partners, including those in the Group of 7.

In its communique, the group’s complaint was diplomatically oblique as it expressed its commitment to avoiding trade measures that run contrary to World Trade Organization rules blocking such “secondary” boycotts.

But in a discussion at lunch, Tarullo said, the differences were not so covert. The others pushed Clinton on the subject, “and the president pushed back fairly hard,” the aide said.

Meanwhile, the United States struck a compromise in the economic communique’s language after Japan and Germany objected to a plan to sell as much as 10% of the International Monetary Fund’s gold reserves. The IMF oversees global monetary stability, takes part in lending to the world’s poorest nations and is engaged in major efforts to reform struggling economies.

Japan’s objections were overcome in private meetings Thursday, but Germany had continued to fight the move, fearful that it would set a precedent that might force it to sell some of its own gold reserves.

The compromise communique never mentions the subject directly and refers only to the IMF’s need for “the resources . . . to perform its tasks.” But U.S. Treasury Secretary Robert E. Rubin said the refined language will allow the sale of “a small portion of the gold.”

The idea behind such a sale of gold resources, said Lawrence Summers, the deputy treasury secretary, is “to provide $5 billion to $6 billion in debt relief for the world’s poorest countries over the next few years.”

No more than 10% of the monetary fund’s gold would be sold, and the proceeds would be used to buy securities, the interest from which would be used to lower the massive outstanding debts that have a number of countries of sub-Saharan Africa in an economic hammerlock.

“Ultimately, the IMF has to face reality, and that will mean gold sales,” Canadian Finance Minister Paul Martin said in an interview.