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Senate Foreign Relations Committee Sessions: International Arms & Equipment Sales

(April 5-28, 1967)

April 5, 1967 - Balancing The Situation

Senator Symington. I am only asking. I just want to get the feel of it, you see, because we have been told here we are balancing the situation. We balanced the strength against Israel against the strength of the UAR, and we balanced the strength of Pakistan against the strength of India. We balanced the strength of Nasser against the strength of Iran, and we are doing a lot of balancing. You all are; we are not. We are just trying to follow the act, and I just wondered if that is what was in your mind, that we, at the U.S. supply level of sophisticated lethal military equipment, it is your understanding that we will consider maintaining it at that level.

Mr. Handley. That is essentially correct; yes, sir. I am not quite sure that you can make a 100 percent statement of that kind, but that is generally----

Senator Symington. But not increasing its sophistication.

Mr. Handley. At this stage, no, sir. We have no intention at this particular moment to sell any new equipment, much less more modern equipment in terms of lethal equipment to either India or Pakistan.

Senator Symington. To either India or Pakistan.

Mr. Handley. That is right.

Now, on the non-lethal side, it would be different.

Senator Symington. I understand.

April 26, 1967 - German Arms Sales to Third Countries [p. 28]

It has now been determined that much of this equipment has been resold through an international arms broker to countries such as the Chad, Iran, Israel, the Sudan, and Pakistan. These countries have apparently paid a great many times more for this equipment than the price the United States received from West Germany.

Most of these surplus arms have been sold through the Merex Corporation, a German company operating out of Bonn. Merex operations extend around the world. They have been closely connected with Interarmco, a large American arms dealer. In addition, it is believed by some that Merex serves as part of the West German Intelligence apparatus. It would appear that Germany uses this private corporation for two reasons: (1) to spare its government the embarrassment of selling arms of American origin directly to countries where the United States is telling its people it is attempting to control the arms race; and (2) to prevent the United States from knowing what actually happens to the arms after the sale to Merex so the Germans can live up to their agreement with us to let us know of ultimate disposal.

As but one example of Merex operations is the sale of some 90 F-86 aircraft to Pakistan. The sale was arranged at a time when the United States was trying to prevent arms from entering Pakistan. The West German government told the United States that these aircraft were going to Iran. Nevertheless, people in our government are confident that the West Germans knew these aircraft were actually going to Pakistan; hence it would appear deliberate deception on West Germany's part.

The evidence suggests that the West German government, in its desire to make a profit off its surplus equipment, has acted and is continuing to act in a way that is against the United States' efforts to dampen arms races. With its great reservoir of surplus military equipment of American origin, West Germany has the means to stimulate arms races throughout the underdeveloped world. The irony is that the East Germans are making a heavy profit on the sale of U.S. equipment, not only that sold to them but also that given to them.

Would you care to comment on those observations?

Secretary McNamara. Yes. May I do so for the record, Senator Symington? I am not familiar with the operations of the Merex Corporation to which you refer. I do know something about the alleged sale of F-86 aircraft to Pakistan. I do not believe any such sale did occur in the form in which you outlined it or in which the statement refers to it.

But I would like to check the details and respond fully for the record.

I will say simply one thing in passing. I know of no effort by the German government or no evidence of any effort by them to mislead us as to sales of arms to other nations. There is at times a difference of opinion between us, perhaps, as to whether such arms should be sold to other nations, but this difference of opinion results from their discussion with us of potential sales and from our exercise of our right to prevent such sales.

Senator Symington. Well, maybe it is because I used to be in business, but I hate to be badly outtraded, and I think we have been in this case.

Secretary McNamara. I do, too.

Sources: Federation of American Scientists