Federal Republic of Germany 655



    15. Franco-Italo-German Cooperation in Weapons Research, Develop-
ment, and Manufacture. In early 1958, the Governments of Germany, It-
aly, and France agreed to undertake a coordinated approach to the
development and production of military weapons. At first many of the
NATO countries feared that this arrangement (FIG) would be inimical
to plans for cooperation in this field on an all-NATO basis. Recently,
however, statements made by FIG spokesmen, particularly Defense
Minister Strauss of Germany, and the willingness of the FIG countries to
keep NATO informed and to cooperate in this field with the WEU and
NATO have done much to allay such fears. After presentation in NATO,
Belgium and the Netherlands joined the group and it was re-formed
into an official NATO Working Group. Technical experts of the five
countries have been meeting in order to work out the details of develop-
ment and production planning including the extension of financial par-
ticipation of these countries. Three major projects under discussion at
the moment are the development of a solid fuel IRBM, Sidewinder, and
a surface-to-air missile of the Hawk type. Beyond this NATO recogni-
tion, FIG cooperation is evidenced by the agreement between Germany
and France relating to joint research and development work to be done
at the French military research center in St. Louis. Fears were also
aroused that FIG would develop nuclear weapons in France, but Minis-
ter Strauss has stated Germany is interested in the use of atomic energy
for such purposes as the propulsion of ships but not in the production of
atomic weapons. The FIG agreement as such neither expressly includes
nor excludes joint production of atomic weapons. There have been re-
cent indications that the new French Government may have certain res-
ervations regarding the FIG arrangement.
    16. German Contributions to Underdeveloped Areas. (See paragraph 8
of the Report.) In contributing to underdeveloped areas, the Federal Re-
public has:
    a. established a technical assistance program for underdeveloped
areas which appears to be in the neighbor ood of $12 million annually;
it is not clear how much of this accumulating sum has been committed
and spent;
    b. made a commitment of $200 million contribution to the overseas
investment fund of the European Economic Community (Common
Market);
    c. maintains a revolving fund of $2.3 billion for export credit insur-
ance, mainly to underdeveloped countries;
    d. indicated its intention to fund over a three-year period $157 mil-
lion of the $330 million owed to the Federal Republic by India on current
account;
    e. agreed to contribute $50 million to a loan to Turkey for imports
from the OEEC countries;
    f. loaned $250 million to the World Bank in U.S. dollars;
    g. is contributing less than half a million dollars to the United Na-
tions Technical Assistance Fund for 1958 (as compared with a contribu-