Foreign Relations of the United States, 1946, The British Commonwealth, Western and Central Europe, Volume V

865.51/10–1746: Telegram

The Chargé in Italy (Key) to the Secretary of State

secret

Rome, October 17, 1946—noon.
[Received 4:45 p.m.]

4027. Inform Treasury from Tasca. See mytel 3815, September 14 [15]. New Italian Minister of the Treasury, Bertone,⁸⁵ made following comments to Tasca yesterday.

a. Currency conversion not possible at the present time owing to the lack of sufficient quantities of new currency. Denominations of 500 and 1,000 lire notes of new currency which had been printed are now unuseable owing to probability foreign power (Yugoslavia) has obtained currency plates. Minister believes that perhaps in 6 or 7 months sufficient quantities of currency may be available. Reliable sources believe that De Gasperi, Prime Minister, may wish to use knowledge of participation of Communists in currency plate theft as lever against Communists during the present coalition govt period.

b. Minister appeared indefinite on question of timing of imposition of new capital levy. Apparently thought is being given to possibility of capital levy program without currency conversion. Minister revealed that part of capital levy program would involve registration of all govt bearer securities (excluding securities purchased under new loan to be launched in November). Italian Minister thought that the capital levy program proposed by the Ministry of Finance was far too drastic and could not be adopted in the form proposed.

c. Treasury Minister estimated that subscription to the new loan would amount to approximately 300 billion lire. He was unable to estimate what amount under such loan would involve simple conversion of outstanding securities into the new issue in order to avoid the capital levy program.

d. Menichella, Director of the Bank of Italy, informed Tasca that an invitation has been extended by the Italian Govt to the Export Import Bank to send a mission of technical experts to Italy to make a firsthand examination of Italian industry. The purpose of the mission would be to study Italian industry first hand and to determine the economic basis for loan from the Export Import Bank to Italy. The technical mission would be directed and guided in its work in Italy by the Bank of Italy.

Sent Department 4027; repeated Secdel Paris 734; Moscow 201. [Tasca.]

Key

85. Following the resignation of Epicarmo Corbino on September 2, Giovanni Battista Bertone was appointed Minister of the Treasury by decree of September 18.