Pages 233-235 from FCO 82-1724

The document reports on the meeting between President Reagan and Mr. Gorbachev in Reykjavik, which ended without reaching an agreement on a full summit. The sticking point was the Soviet attempt to confine the US Strategic Defense Initiative (SDI) to laboratory research. The author suggests that a considered reaction should wait for briefings by Secretary Shultz and bilateral contacts. It is noted that the Prime Minister and Lady Young will meet with Mr. Gorbachev's emissary, Victor Karpov, the head of the Soviet delegation to the Geneva talks. The document emphasizes the importance of maintaining firmness and unity within the alliance and expresses disappointment at the lack of agreement on a date for a further summit. The focus now is to build on the progress made and continue discussions on the issues where agreement appears close. The document also addresses the Soviet Union's demands on SDI, the government's position on SDI research within the terms of the ABM Treaty, and the likelihood of the Prime Minister visiting Washington and Moscow in the future.