Foreign Relations of the United States, 1951, Europe: Political and Economic Developments, Volume IV, Part 2

No. 921

ECA message files, FRC 53A278, Belgrade: Telegram

The Administrator for Economic Cooperation (Foster) to the ECA Mission in Yugoslavia ¹

secret
priority

Washington, August 17, 1951—2 p.m.

Ecato 117. Subject—Interim aid. Reference—Ecato 110 rptd Paris Torep 5725, not rptd London.²

1. State consulted Congressional committees by let for Yugo aid this qtr. Expect publication within next few days Presidential notification his intent allocate to ECA up to $30 mil MDAP funds for additional econ assistance Yugo.³

2. Brit Emb here communicated to State today HM For Off concern over possibility unilateral US announcement of interim aid allotment prior tripartite agreement Belgrade total aid available to Yugos this qtr. State replied with substance of reftel and added our concern over urgency keep aid flowing during present critical period.⁴

3. Possible after Presidential notification for ECA/W to delay issuing allotment of funds pending tripartite agreement but this unwise because (a) urgency present needs Yugo, (b) necessity place forward contracts now, (c) quarter already half completed and Fr funds still not in sight, (d) Yugos expect and planning action on basis receive US funds soon.

4. As UK concern seems to be over size total aid this qtr, and not whether aid shld be extended now, willing to allot only portion of $30 mil to Yugo Govt at this time to cover highest priority PAs and to take Fr and Brit views into account when deciding amount and timing of further allotments this qtr.

5. In view shortness time for decisions required on allotment, request ur views on above soonest.

6. Also for our guidance in issuing PAs after making allotment require ur views soonest on order priority items and quantities on shopping list outlined Ecato 72⁵ and also ur advice on what other items might have high enough priority to be added.

Foster

1. Drafted by T. Kaufmann and cleared with Stettner, Green, Katz, and Van Dyke. Repeated to Paris and London.
2. Telegram Ecato 110 reported that the ECA estimated Yugoslavia’s balance-of-payments deficit to be $50 million for the last half of 1951 and that 75 percent of the aid needed to cover this deficit should be made available in the third quarter of 1951. (ECA message files, FRC 53A278, Belgrade)
3. Regarding the release of these funds for economic assistance to Yugoslavia, see Document 925.
4. A memorandum of this conversation is in file 868.10/8–1651.
5. Not printed.