Foreign Relations of the United States, 1950, Central and Eastern Europe; The Soviet Union, Volume IV

768.11/4–2850: Telegram

The Acting Secretary of State to the Embassy in Yugoslavia

secret

Washington, May 15, 1950—5 p. m.

382. Embtels 560, Apr 27 and 570, Apr 28.¹ Tito’s recent speech and press conference must be considered encouraging sign in direction closer relations with West, particularly with neighboring states. As it will be important for US to know whether and in what ways Tito actually moves in this direction, Dept hopes Emb will continue full reporting on such developments.

It has been axiom of our Yugo policy not to make polit concessions the price of econ aid and not to press for changes in Yugo domestic polit system, taking into account Tito’s determination to demonstrate his freedom from domination of West as of East. At same time US does have legitimate interests in certain aspects of Yugo fon relations and must take appropriate opportunities to advance them. We wish to encourage Yugo trade orientation to West and estab modus vivendi with Western system on basis mutual advantage and mutual respect for rights and independence. Primary problem in this regard is resolution of serious issues impeding better relations with Greece and Italy.

Advent Plastiras Govt in Greece apparently has opened way to gen improvement relations between Yugo and Greece. Except on humanitarian issue of Grk children (Embtel 607, May 9²), which judging from most recent reports now on way to solution, Dept believes best procedure from US viewpoint at this stage is for Yugo and Grk Govts to set own pace in reaching more normal relationship through exchange chiefs of mission, reopening railroad and Salonika free zone, and expanding trade. US may be able to contribute to latter in continuing efforts already begun, with purpose of easing Yugo dollar position, to foster Grk purchases of Yugo goods with ECA dollars.

Better Yugo-Ital relations are obviously of major importance to Western policy and may be crucial, if only for reasons of geography, in event of Sov aggression against Yugo and in event of Western decision to give mil aid to Yugo. Trieste is of course key problem, absence of settlement making it difficult to deal with other outstanding issues in atmosphere poisoned by periodic outbursts of hyper-nationalism and mutual recrimination. At present the prospects for solution Trieste problem not bright, although recent Ital proposals (Rome’s 1967, May 10, to Dept³) are promising. However, in view Tito’s own statement in Apr 27 speech that mutual endeavor to improve econ and other relations can only contribute to easier solution of disputed questions, Dept believes US influence shld continue to be exerted toward bringing Itals and Yugos closer together. If Yugo trade is to be tied into Western Eur economy, it is vital that Italy and Yugo, as each other’s natural customers, shld evolve some broader understanding.

Despite favorable tone of Tito’s recent pronouncements, it is important to bear in mind that growing confidence of Yugo leaders may reflect belief that they will receive Western support in all eventualities and may create exaggerated impression indispensable niche Yugo holds in Western calculations. Popovic’s remark that Yugovt shocked and surprised at Garner statement no final decision yet made on IBRD loan (Embtel 596, May 6⁴) may be merely further illustration Yugo misunderstanding Bank’s position indicated by Kardelj speech before Assembly Dec 1949.⁵ However, it also may exemplify failure to realize Western econ support not automatic and may depend on Yugovt’s own performance. Delay in IBRD loan in addition to Exim Bank ltr to Kosanovic (Deptels 317, Apr 20 and 321, Apr 21⁶) may be helpful in dispelling illusions on that score.

Dept desires avoid dangers flowing from Yugo miscalculations concerning US intentions and possible requests for aid far in excess of what can or will be given (such as suggested in recent Alsop articles from Belgrade). Such development wld provide fuel for public controversy and make more difficult for Dept to continue present effective support of Yugo efforts maintain independence against Sovs and to carry out our basic Yugo policy as laid down by NSC.

Dept wld welcome Emb comments on above. No specific action involving approach to Yugos contemplated at this time.

Webb

1. Neither printed; they reported on Marshal Tito’s address of April 27 to the Yugoslav People’s Assembly and his general press conference of April 28, respectively (768.11/4–2750 and 768.11/4–2850). For the full texts of the address and the press conference, see Tito: Govori i Chlantsi, vol. V, pp. 87–171. For a long extract from Tito’s address, see Carlyle, Documents on International Affairs, 1949–1950, pp. 497–500.
2. Not printed.
3. Not printed. For documentation on the attitude of the United States regarding the problem of Trieste, see vol. iii, pp. 1302 ff.
4. In the course of a press conference on May 1, Robert L. Garner, Vice President of the International Bank for Reconstruction and Development, commented briefly on the status of a prospective IBRD loan to Yugoslavia and suggested the possibility that there might be no loan at all. In the telegram under reference, not printed, Ambassador Allen reported having been informed by Yugoslav Ambassador-Designate to the United States Vladimir Popović that his government was surprised and shocked at Garner’s statement. Popovic warned that it might be necessary for the Yugoslav Government to react publicly to the statement (868.10/5–650). For a review of the status of the prospective IBRD loan to Yugoslavia, see the Department’s information telegram of May 1, p. 1410. Regarding the appointment of Ambassador Popovic, see footnote 1, p. 1421.
5. See footnote 2, p. 1348.
6. Telegram 317, not printed, transmitted the text of the letter of April 20 from Export-Import Bank President Gaston to Ambassador Kosanović, p. 1407. Telegram 321, not printed, reported upon certain revisions made in that letter; see footnote 1, ibid .