In a secret telegram to French president Francois Mitterand, the Prime Minister even cast doubt on the future of the Nato alliance, should he fail to stop shipments of the anti-ship missile, then being used with awful effect against Britain’s task force in the South Atlantic.
The sea-skimming Exocet was the most feared weapon in the Argentinian armoury, accounting for the destroyer Sheffield and the container ship Atlantic Conveyor, and posing a mortal threat to Operation Corporate, the mission to recover the Falklands.
Fortunately for Britain, only five of the missiles, manufactured by France’s Aerospatiale, had been delivered before the invasion of the islands on April 2 1982.
One had been used up in training and following the attacks on Sheffield and Atlantic Conveyor just one was left. The junta was desperate for more.
Files released at the National Archives in Kew today convey Whitehall’s desperation to stem the flow of Exocets, even to the extent of considering an attack on a suspected shipment in neutral Brazil.
So febrile was the atmosphere that the Attorney-General, Sir Michael Havers, suggested his own “James Bond” plan to deal with the threat.
Thatcher’s broadside to Mitterand came on May 29, four days after the sinking of Atlantic Conveyor and her cargo of troop-carrying helicopters considered vital to the British advance on Port Stanley.
The French president had telephoned the Prime Minister to say that Peru, an ally of Argentina, was pressuring his country to deliver a batch of Exocets ordered before the war.
The British were in no doubt about the true destination of the missiles and Thatcher made it clear that the French would pay dearly for putting their reputation as a reliable arms supplier before the Anglo-French alliance.
“We have been much heartened by France’s stalwart support both in public and private,” she wrote. “If it became known, as it certainly would, that France was now releasing weapons to Peru that would certainly be passed on to Argentina for use against us, France’s ally, this would have a devastating effect on the relationship between our two countries. Indeed, it would have a disastrous effect on the alliance as a whole.”
The message was rammed home by Sir Michael Palliser, diplomatic adviser to Thatcher. Relating a meeting with Francois Gutman, secretary general of the French foreign ministry, he wrote: “I made it absolutely clear to him that this was a matter of crucial importance to the Anglo-French relationship in general and to the Prime Minister’s own relationship with the president in particular.
"I did not believe I would be overstating the matter if I used the word “catastrophic” in relation to any supply by France of those missiles to Peru.”
The secret war against the Exocet went into overdrive following the loss of Sheffield on May 4. Military attaches and MI6 stations around the world were ordered to track suspect shipments and Israel, South Africa and Libya were all suspected of aiding the junta.
Even Switzerland, whose embassy in Buenos Aires was representing British diplomatic interests, was involved. One report accused Swissair of shipping Israeli equipment to Argentina.
“The risk of re-supply to the Argentinians of further air-to-sea missiles justifies consideration of all options to prevent this – even the most way-out - which may be thought more appropriate to a James Bond movie!” remarked Havers in a handwritten note to Thatcher.
The Government law officer described a meeting with the director of a cargo airline who told him that black-market Exocets would most likely be flown to South America by an operator based in the Middle East. “The profits can be enormous and will attract the cowboy carrier in circumstances when the exporting country will not want to risk its own aircraft for publicity reasons,” wrote Havers, before suggesting that a British agent could be recruited to serve as the aircraft’s loadmaster.
“The loadmaster has total control of the flight and therefore can redirect the aircraft in transit to (for example) Bermuda. This will cost money (this is an expensive dirty business) but would in my view be cheap at the price.”
Reports about Exocets poured into London. When Francis Pym, the Foreign Secretary, was told that Iran may have captured seven missiles from Iraq and might sell them to the junta, he told the British embassy in Tehran to buy them.
Meanwhile in Brazil, the British air attache was keeping an eye on a Boeing 707 engaged in suspicious flights between Libya and Argentina via the Brazilian city of Recife. A Brazilian source who had gained access to the aircraft during one stopover spotted six containers similar in size to the Exocet.
In a secret ‘flash’ telegram of May 31, William Harding, British ambassador in Brasilia, warned: “Airat (air attache) who came within five yards of the aircraft last night reports crew very nervous, with armed security guards in evidence. Source is only person allowed on board aircraft, which reflects both his privileged position and vulnerability if we do not guard information with great care.”
Harding suggested four options: discreet diplomatic pressure on the Brazilians, an orchestrated press campaign to embarrass the Brazilians, “direct action” in Recife or “direct action” outside Brazil.
“I would rule out any direct action on Brazilian territory, however high the stakes,” he cautioned. “Operationally it would be very difficult to guarantee success and the consequences could poison our relations with Brazil for a very long time.”
Pym cabled back that Libya was known to be supplying Argentina with French-made equipment, possibly air-to-air missiles.
Harding responded: “In view of the evident connivance of at least some Brazilian authorities with two previous shipments, I still think that pressure through the media would be more effective.”
Pym replied: “We are setting in hand the leaking of this information with a dateline outside Brazil. We have ruled out any idea of quote direct action unquote in Brazilian territory, and have no current plans to take it outside Brazil.”
Despite assurances, the British remained suspicious of French motives. They were right to be. A team from Dassault, makers of the Super Etendard fighter that carried Exocet, was in Argentina helping that country’s navy master launch procedures. On June 10 a top secret “UK Eyes Alpha” message was received. Three new Etendards had been spotted at the Dassault factory near Bordeaux carrying Peruvian air force markings, yet Peru had not ordered the type.
“All adding up to a possible circumvention of the French arms ban in the guise of a delivery to Peru,” the report noted.
The secret war against Exocet would eventually be won, thanks mainly to a MI6 sting operation undertaken by the Hamburg-based agent, Anthony Divall. Posing as an arms dealer and equipped with a £16 million bank facility, he fooled Argentinian arms buyers into believing he could provide 30 Exocets. They were still undelivered when the Union Flag was hoisted over Port Stanley.
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