User:Vzamhne/sandbox

U.S. prisoners of war in Vietnam (1966)
Long time before the hostage crisis, the United States asked for the help of Algerian government on other occasions. Ambassador at Large Averell Harriman visited Algiers in December 1966 to ask the Algerian government to intercede with North Vietnamese authorities in favor of American prisoners and to evaluate the possibility for Algeria to help finding a solution to the Vietnam War.

International Section of the Black Panthers Party in Algiers (1972)
In 1969, prominent members of the Black Panthers had settled in Algiers and established the International Section of the Black Panthers Party. In 1972, Willie Roger Holder a Vietnam war veteran and Catherine Marie Kerkow hijacked Western airlines flight 701 from Los Angeles to Seattle and flew to Algeria with a $500.000 ransom to be donated to the Black Panthers. They were granted political asylum but the Algerian authorities seized the ransom money and returned it to the United States.

Iran-Iraq Algiers Agreement (1975)
On March 6th 1975, the Algiers Agreement was signed between Iraq and Iran following the mediation of president of Algeria Houari Boumediene, to end the disputes between the two countries concerning their borders known as Shatt el Arab in Arabic and Arvand Rud in Persian.

Iranian revolution (1979)
After being expelled from Iraq Ayatollah Khomeiny considered various options including moving to Pakistan or Algeria. A group of active supporters based in France convinced him that moving to a western country like France would give him access to more media attention, would make it easier for his followers to join him from all parts of the world and would offer better means of communication with Iran.

For historical reasons, the revolution for independence against French colonialism, the Algerian regime under single-party system was supportive of revolutionary and anti-colonial movements in the world. Algiers was named "the Mecca of revolutionaries". Algeria did not interfere in Iranian affairs but representatives in Europe of Ayatollah Khomeiny such as Sadegh Ghotbzadeh had developed connections with Algerian government and single ruling party -FLN- officials in Algeria and in France where the party was represented by a Paris-based organization "Amicale des Algériens en Europe" (Association of Algerians in Europe).

When Ayatollah Khomeiny decided to move to France, the Algerian organization was ordered by the government to bring assistance to the Iranians in France in order to organise the stay of Khomeiny and his followers, especially for his accommodation. A small house was rented in Neauphle Le Chateau, 40km from Paris.

National Day of Algeria (November 1st 1979)
On November 1st 1979 Deputy Secretary of the State Department Zbigniew Brzezinski attended the celebration of the 25th anniversary of the beginning of the revolution for the independence of Algeria. The next day he met briefly with prime minister of Iran Mehdi Bazargan.

After the invasion of the U.S. Embassy in Tehran (November 5th 1979)
Three days later, on November 5th, the U.S. ambassador in Algiers received an instruction from the State Department requesting him to contact the Ministry of Foreign Affairs secretly as revealed by "Public library of US diplomacy". The State Department wanted to see if Algerian authorities could be of any help after the U.S. Embassy in Tehran had been invaded and U.S. citizens detained. The Algerian president immediately sent his ambassador back to his post in Tehran, with no result.

Algerian envoy for Christmas celebration
In December 1979, the Revolutionary Council invited 3 American clergymen and Algerian citizen Cardinal Duval, the Roman Catholic Archbishop of Algiers, to celebrate Christmas with the hostages.

The Algerian channel to communicate with Iran
President Jimmy Carter wanted to obtain the release of the hostages before leaving office. He asked a second time for the help of Algeria, the American diplomats knowing that the Algerian government had kept good relations with Tehran. But they were very doubtful about the ability of the Algerian staff to find a solution to this crisis after all the other previous intermediaries such as former prime minister of Sweden Olof Palme and United Nations General Secretary Kurt Waldheim had failed.

Therefore the idea was to use the Algerian mediation for communicating with the Iranians only. This approach was consistent with Algeria’s role as diplomatic agent for Iran in the United States.

In October 1980, the Iranian minister of foreign affairs Mohamad-Ali Rajai went to New York to attend the United Nations General Assembly to present his country’s case against Iraq. Warren Christopher seized the opportunity of a meeting between Rajai and the Algerian ambassador to the United Nations to have a contact with the Iranian minister. But he refused to meet any American official. Nevertheless, at this point Algeria started to get involved in the hostages matter and when Mr Rajai made a stop in Algiers on his way back to Tehran the Algerian diplomats offered their help to find a solution to the hostages crisis by facilitating the communication between the two countries.

Majlis decision in favor of a negotiated solution
Two days before the presidential elections in the United States, the Iranian parliament (Majlis) voted on November 2nd 1980 to release the American citizens detained in Iran if the United States accepted to meet a list of conditions :


 * 1) First and foremost to unfreeze Iranian assets in U.S. banks,
 * 2) To return the wealth collected by the late Shah during his reign,
 * 3) To withdraw all lawsuits against Iran in the United States
 * 4) To pledge non-intervention in Iranian affairs.

The message was immediately delivered by the Algerian foreign minister to the State Department with a letter confirming that the Algerian government was officially considered an intermediary by Iran.

The Iranian ministry of foreign affairs stressed that the United States government was requested to "announce its response as soon as possible" and "to inform the world" of the American answer to the hostage release condition.

Ambassadors' role limited to forwarding messages
The minister sent the ambassadors in Tehran and Washington DC to Iran to receive from the Iranians their detailed proposal for the release of the hostages.

Their role was limited to forwarding messages between the negotiators of the two country but were not themselves participating to these negotiations.

In Tehran, they visited the hostages and collected letters for their families in the United States. Back to Washington, the Algerian diplomats organized a gathering with the families and delivered the letters. This first contact with the members of their families who were captive for more than one year was appreciated by the families.

The Algerian foreign minister and the ambassadors were then referred in the press as “the mailmen”.

The "deadlock"
The non-intervention condition

The fourth Iranian condition concerning the pledge of non-intervention of the United States in Iranian affairs did not present any difficulty and did not necessitate any negotiation with any party. The American diplomats in Algiers made a declaration that was later transmitted to the Iranians : “It is and from now on will be the policy of the United States not to intervene, directly or indirectly, politically or militarily, in Iran's internal affairs”.

But the main condition imposed by Iran for the release of the American hostages required a very complex financial negotiation concerning frozen assets under the form of funds, gold and securities, kept in various American banks and international banks based in the United States and controlled by the U.S. Department of Treasury and the Federal Reserve Bank.

Therefore the situation was blocked. Algeria started out as a simple mailman, delivering messages between the United States and Iran, but in the end it played a decisive mediator' s role in the negotiations for the release of the 52 American hostages and the return to Iran of assets frozen in the United States.

Algerian sources close to the negotiations said Algeria had faithfully observed its role as an intermediary until about a month ago, when a deadlock was reached between American and Iranian negotiators.

 The New York Times, Jan. 26, 1981 

The Algerian intervention in the negotiations
The Algerian minister and the ambassadors had passed messages and delivered letters, but they were not qualified to initiate the negotiations on extremely complex financial matters between two countries with totally antagonistic views.

Complex financial negotiations
At this point there had been no negotiation yet. To the contrary, the negotiation on the $24 billion of frozen assets claimed by Iran was going to be extremely complex. On the American side : "The claims involved more than just a wide variety of commercial and financial matters. There was also U.S. government claims asserted against Iran by the Export-import Bank of the United States for nonpayments of loans, claims by the Defense Department covering military equipment purchased or contracted for by the Iranians, claims by the State department for embassy property confiscated, and lastly - and clearly the most sensitive - claims on behalf of the hostages for their unlawful detention.

On the Iranian side : "Treasury knew in September 1980 that considerably more than $8 billion had been blocked and that it was basically in four pots : (1) at the N.Y. Fed., (2) at the overseas branches of U.S. banks, (3) at the domestic branches of U.S. banks, and (4) in the hands of relatively large number of companies (principally oil companies) and individuals, both here and abroad, most of whom also had claims against Iran.

American Hostages in Iran : the Conduct of a Crisis (1985) The Iranian frozen assets were under the form of gold bullion, cash and securities.

American delegation in U.S. Treasury Department's representatives
For his second visit to Algiers on November 11th, Deputy Secretary of State Warren Christopher was accompanied by representatives of the U.S. Treasury Department. He gave the American answer to the Iranian conditions to the Algerian minister of foreign affairs and traveled back to the United States. The Algerian ambassador in Tehran left for Iran to simply deliver the document to the Iranians[10]. “The participation of financial leaders in the second American delegation did not surprise Algiers in view of the Iranian demands pertaining to the Shah’s assets and Iranian funds in the United States, but there was doubt as to what role Algeria could play in handling these particular aspects of the negotiation”.

CIA Near East / North Africa Report - 6 February 1981 - Approved for release 2007/02/08

Head of the Central Bank of Algeria
Being blocked, the foreign minister of Algeria calls upon the governor of the Central Bank of Algeria, internationally renowned central banker at the head of the Algerian central institution and member of the Board of the International Monetary Fund (IMF) for over 18 years.

The intervention of the Algerian governor was facilitated by the fact that he was already dealing on regular basis with the Federal Reserve Bank and was well known by American executives. The Central Bank of Algeria also had cooperation relations with the Markazi Bank of Iran since the beginning of the 70s and was called for assistance after the revolution to provide training to executives of the Iranian central bank, including for its newly appointed governor. Then the Algerian intermediaries began to make their own proposals to break the impasse,  an Algerian source said, while declining to go into detail on his country's specific contributions to the final accord. Some sources described Algeria's role as one of creative mediation, and others called it active intermediation.’' 

 The New York Times, Jan. 26, 1981  The governor discussed with the Iranian team the validity of each claim making a difference between claims that should be satisfied immediately by the United States and other claims that he proposed to present, in a later stage, to an arbitration tribunal to be created.

He also used his past experience negotiating the Evian Accord for the independence of Algeria concerning the repayment by the newly independent country to French banks.

This point was an essential part of the negotiation and a key point of the final agreement : the problems of the repayment of the loans from U.S. banks to Iranian entities."'Seghir Mostefai, a member of the Algerian team and head of Algeria's Central Bank, had earlier explained to members of the U.S. team that, under the terms of Algeria's settlement with France, loans from French banks to Algerian entities had been brought current - not paid off - and no special guarantees had been given by Algeria with respect to future payments. ' American Hostages in Iran : the Conduct of a Crisis (1985)"The financial agreement was made possible because the American negotiators accepted that the loans would be brought current by Iranians to unfreeze their assets.

Last minute problem
The target was to transfer $8.1 billion to Iran. But most of the Iranian assets held by the Federal Reserve Bank were gold bullion. Since the beginning of the negotiation, the value of gold had decreased by $150 million.

The value of securities to be release had also declined in this period of time.

Finally, because of these fluctuations the global value of the Iranian assets went from $8.1 billion to $7.955 billion."In the night of January 17th this matter was discussed between President Carter in Washington and his advisers in Washington, New York and Algiers. Finally Warren Christopher insisted that the Algerians explain the situation to the Iranians. American Hostages in Iran : the Conduct of a Crisis (1985)"The governor negotiated with the Iranian team the final amount to be received from the United States ( $7.955 billion) the whole night of January 18th. The final agreement was reached.

Final agreement
The governor designed a transfer mechanism in which the Central Bank of Algeria played a pivotal role for the release of the American diplomats detained in Iran :

Due to the relation with the Central Bank, the Iranian authorities accepted that their assets would be transferred by the American authorities to an escrow account in the name of the Central Bank of Algeria acting as a neutral intermediary to collect the funds before the release of the hostages and to transfer these funds to Iran after the release.

The Iranian assets under the form of gold bullion, cash and securities would be transferred to an escrow account of the Central Bank of Algeria kept at the Bank of England.

When the Bank of England notifies the Central Bank of Algeria that the agreed amount was transferred, the Iranians would be notified and the American hostages could be released.

One part of the transferred amount would be kept at the Central Bank for pending settlements of U.S. claims.

Finally, the United States transferred to the Iranians a total amount of : $7.956 billion.

Chronology
(Based on the Iran hostage Crisis - A chronology of daily developments - Committee on Foreign Affairs. U.S. House of Representatives. March 1981)
 * November 10th, 1980 : Deputy Secretary of State Warren Christopher left for Algeria carrying the American response to the Majlis conditions.
 * November 11th : Warren Christopher and his delegation left Algiers for the United States. The U.S. delegation explained the American position to the Algerians who will forward the response tomorrow.
 * November 12th : The Algerian ambassador to Iran and the Algerian ambassador to the United States presented to the Iranian government in Tehran the U.S. response to the Majlis conditions. Reuters said that the response was presented to Executive Affairs Minister Behzad Nabavi.
 * November 13th : The Iranian government group handling the U.S. response held a meeting chaired by minister Nabavi. Western news sources in Tehran said the impression was that the American response was not positive" and that Iran was not pleased with the American approach.
 * November 22nd : The Iranian government gave an official response to the Algerian diplomats in Tehran to be delivered to the United States. According to Iranian news sources and Reuters, a spokesman for Prime minister Rajai said "we have asked the Americans to give a clear, precise response to the Iranian conditions." The spokesman said the American reply to t.he conditions set by the Majlis on Nov. 2 was "neither explicit or clear" and offered "additional proposals" which the lranians did not seek.
 * November 24th : The Algerian delegation left Tehran with the reply of the Iranian government. A spokesman for prime minister Rajai said the Iranians were asking the United States for a clear precise answer either a “yes” or a “no” to accepting the Majlis conditions.
 * November 25th : The Algerian delegation left for Washington
 * December 2nd :Deputy Secretary of State Warren Christopher arrived in Algiers with the American delegation, carrying the American response to Iran's Nov. 22 request for clarifications on the four conditions set by Iran for release of the hostages.
 * December 3rd : Talks between the American team and the Algerian intermediaries continued in Algiers.
 * December 4th : The Algerian delegation arrived in Tehran carrying the American clarifications.
 * December 16th : Reuters news agency reported that Iran was asking for "financial guarantees" from the United states that Iran's assets frozen in the United States since Nov. 14, 1979, would be transferred to a neutral country, presumably Algeria.
 * December 18th : Tehran radio said the three Algerian diplomats would carry the new Iranian message to the United States soon.
 * December 19th  : The Algerian delegation left Tehran for Algiers. Reuters reported that the Iranian reply suggested that both the United States and Iran establish escrow accounts in Algeria to be held against judgements of the two nations' claims against one another. Pars said Iran would not accept the word of the American President for financial guarantees but wanted the United States to deliver Iran's gold and assets to the Algerian Central Bank, where it would be held until after the hostages were released.
 * December 21st : Tehran radio said the United States accepted the Iranian claims but that the Iranian government was offering a "procedural method" for returning the assets to Iran by transferring the funds to the Algerian Central Bank prior to the release of the hostages. Algeria would transfer the funds to Iran after the release.
 * December 26th : The Algerian delegation left Algiers for Washington.
 * December 28th : Jimmy Carter meets with the Algerian delegation at Camp David.
 * December 30th : The Algerians left Washington for Tehran after four days of intensive consultations with State Department officials. The New York Times reported that the new formulation offered Iran $5 or $6 billion to be placed in the escrow account in Algeria to be transferred to Iran after the hostages were released.
 * January 2nd 1981 : Warren Christopher and the American financial expert insisted there was no time left before President Carter leaves office so the present negotiation would have to be abandoned if a final settlement was not agreed before January 16th. They explained that they could arrange for the release of $2.5 billion in the federal Reserve Bank of New York prior to the release of the hostages. And that if Iran quickly arranged to bring current its loans from U.S. banks holding Iranian deposits overseas and additional $4.8 billion could be released. Globally, the amount of frozen assets that could be released at that stage was approx. $8 billion. The Algerian team went back to Tehran with this proposal.
 * January 7th : Iran refused to release the hostages until it has received $9.5 billion. Warren Christopher and his delegation left Washington for Algiers as it is the last chance to finalize a deal. He stayed there two weeks until the arrival of the hostages and left with them for Wiesbaden.
 * Fourteen days in Algiers : Negotiations were focused on the mechanism by which the Iranian assets would be transferred to an escrow account at the Algerian Central Bank following the arrangement proposed by the governor. The Iranians had chosen the Bank of England to receive the funds transferred from the United States. To complete the escrow arrangements a British delegation arrived in Algiers.


 * January 17th : Last minute problem : from $8.1 billion to $7.955 billion.


 * January 18th : in the final agreement, it is written that as soon as the Bank of England has certified to the Algerian Central Bank that it had received cash, gold and securities in the aggregate amount of $7.955 billion “Iran shall immediately bring about the safe departure of the 52 U.S. nationals detained in Iran”.
 * January 20th : 11AM, in Algiers the deputy governor of the Bank of England received a message from London confirming that they had received a total of $7.956 billion. Which triggered the release of the Americans detains in Iran.
 * January 20th-21st : Two Boeing 727 aircrafts belonging to Algerian airlines AIR ALGERIE leave for Tehran transporting a medical team and security officers. Only one of the B727 was transporting the hostages, the other one was a decoy for security reasons. The hostages arrived in Algiers, were met by Warren Christopher and the American delegation and left in an american aircraft for Wiesbaden.

Aftermath for Algeria
"'On the official level the new Reagan Administration was a little less friendly on ideological grounds toward Algeria than the Carter administration had been. So Algeria did not get any direct economic benefits in the negotiations on the price of gas, etc. out of this. It may have encouraged them to some degree in their efforts to liberalize their own economy.' R. Thomson Political Counselor - Algiers (1980-1982)"In 1980, the Algeria air force was interested in buying a Lockheed C-130 Hercules. The position of the U.S. administration was that Algeria could not get the military version but only the civilian version of the aircraft.

After the Algerian intervention in the hostage crisis he sale of the Lockheed L-100 Hercules to Algeria was approved by Secretary of State Alexander Haig.

Later Algeria aquired the military version C-130.