Vice President Mondale pressed West German Chancellor Helmut Schmidt today to expand his country's economic growth and curb its sale of nuclear technology.
The more specific upshot of today's talks - part of Mondale's around the-world diplomatic mission for the new administration - was the suggestion from both governments that tighter curbs on the sale of "sensitive" technology may soon be written into the nuclear Non-Proliferation Treaty.
Schmidt said he expects wider exchanges on the nuclear pact to begin "very quickly," and officials in the Mondale party said the talks could begin as early as next week.
The Vice President said prospects for a "final resolution" of the proliferation question - symbolized by West Germany's contract to sell Brazil nuclear fuel-enrichment and reprocessing equipment - were "much enhanced" by today's talks.
But no specific agreements were announced on that question or on the Carter administration's desire to see Schmidt adopt an economic "stimulus package" equivalent in scale to the one Carter is recommending for the United States.
American officials said Schmidt indicated some flexibility in his economic plan, but aides to the chancellor said he has no present plans to expand his tentative proposal to add $4 billion in spending over the next four years - an amount the administration's economists consider inadequate to pull other Western European countries out of their "growth recession."
American and West German officials alike were deliberately vague on whether the move toward curbs on the sale of nuclear technology could retroactively affect Bonn's projected $4.8 billion deal with Brazil, but there were hints that the United States is starting to negotiate with Brazil to provide an alternative source of nuclear fuel for its economy.
When Schmidt was asked if West Germany still intends to honor its contract with Brazil, he said the question involves "sensitive problems," but noted that his country has "so far fulfilled all the obligations it has undertaken in every treaty," including the 1970 non-proliferation pact, "and that will be the case also in the future."
Then he added: "That does not exclude the possibility that in the future new additional duties in the form of treaty obligations will have to be included."
Schmdit said he expects wider exchanges on the nuclear pact to begin "very quickly" and officials in the Mondale party said the talks could begin as early as next week.
Carter has made reduction of nuclear arms and equipment a major emphasis of his foreign policy and the West German-Brazilian deal, along with a similar planned transfer of nuclear technology from France to Pakistan, is regarded as a key test of his policy.
American officials called today's discussion "quite encouraging." "We made progress today," said one of Mondale's aides. But West German sources, while indicating that Bonn would avoid such deals in the future, cast doubt on the possibility of its taking the initiative in abrogating any part of the lucrative contract with Brazil.
Considerable emphasis was given here to reports in the Brazilian press that Carter's State Department appointees are discussing an American guarantee of nuclear fuel for Brazil if it gives up just the purchase of the West German equipment for enriching uranium and recycling nuclear fuel. Bonn officials suggested privately that they would have no objection to such a request from Brazil, which would allow them to complete the rest of the sale.
But the Brazilian deal is a potential bombshell for Schmidt at home. The $4.8 billion contract is the largest single export sale every made by West German, the reward for some $7 billion invested in nuclear research in recent years. The deal to supply eight power stations plus a complete atomic fuel-processing system will produce some 10,000 new jobs here.
Only the technique for reprocessing used fuel is controversial: It yields plutonium, which can be used in making atomic bombs. The Americans and the West Germans disagree on the effectiveness of the controls imposed on the use of the reprocessed fuel.
Another disagreement exists in the governments' economic policies. Mondale said he had "urged the chancellor, as I will the prime minister of Japan, to pursue similarly stimulative packages" to the one Carter is about to send Congress.
The economists traveling with Mondale argue that only a coordinated effort by the three strongest countries in the non-Communist world can lift the international economy from the doldrums and help cure the rising unemployment an trade deficits in such countries as Britain and Italy - the next stops on Mondale's tour.
American officials calculate that the public-works program Schmidt outlined last week is only a quarter the relative size of the American and Japanese "stimulative packages." They also note that Schmidt is projecting only a 5 per cent economic growth - a figure some economists consider too modest - and is planning to reduce his budget deficit by $3 billion even though West Germany's unemployment of more than 1 million is near a postwar high.
Bonn officials reply that their successful anti-inflation policies have contributed to the economic stability of Western Europe and note that West Germany is already making major loans and price-support contributions to other European Common Market countries. A Carter-sized stimulus program, they assert, could touch off an inflationary wage-price spiral destructive to all these countries.
The Vice President said Schmidt indicated that he is still "working on the size and timing" of his stimulus package, but Schmidt, speaking in English at their joint press conference, gave a different impression.
He said he was already "fully aware" of the viewpoint Mondale had expressed and had formulated his own program "in knowledge of what" Carter was recommending to Congress. Aides said later they doubt that there would be any change in the chancellor's thinking.
Despite such apparent differences, both Mondale and Schmidt went to great lengths to establish a cordial basis for future dealings.
Schmidt, who had made no secret of his preference for President Ford before the election, went beyond the normal diplomatic courtesies in welcoming the early visit from Carter's running mate.
The two men and their aides met for four hours this afternoon, and hour longer than scheduled. Tonight Mondale was the guest of honor at a banquet that Schmidt expanded from the original "working dinner" to a festive occasion at which the Vice President was introduced to a wide variety of West German leaders.
Last week Schmidt told The New York Times that Carter's inaugural speech was eloquent but "lacking in clear direction." Today he was beaming with pleasure when Mondale presented him a copy of the same speech, authographed by Carter.