Foreign Relations of the United States, 1952–1954, Western Europe and Canada, Volume VI, Part 2

751.5 MSP/7–1252: Telegram

No. 526
The Ambassador in France (Dunn) to the Department of State

secret

Paris, July 12, 1952—9 p.m.

303. Cotel.

1. Accordance Def tel [phone] re addl OSP I personally gave Pleven today fol ltr:

Begin text. I have the honor to ref to your memorandum of May 6,² and your letter of July 1³ rel to possible addit off-shore procurement by the US in France.

The proposals in the May 6 memo as well as the comments contained in your letter of July 1, have recd the most careful consideration by all interested Departments in Washington. I have now been authorized to communicate to you that the US Govt is prepared to include in its normal fiscal yr 1953 off-shore procurement program for France the fol items, sub, of course, to satis negots as to prices, specifications, delivery dates, etc.:

(1) MD 452 aircraft.

As stated by the US rep in the North Atlantic Council mtg of July 9,⁴ the US is prepared to procure in France $86,540,000 of MD 452 aircraft. The US is primarily interested in procuring the Mark IV series of this type aircraft. Details re types to be procured will of course be worked out during contract negots, but in principle, the US desires to procure only the minimum quantity of the Mark II series essential to keep plants in production prior to conversion to the Mark IV series.

(2) Electronics, radio and radar.

Washington does not have sufficient data relative to electronics material to permit detailed decisions at this time. However, the Dept of Def is anxious to explore the possibilities of increased off-shore procurement of such equip and is prepared to give consideration to this type of material in its refinement of the fiscal year 1953 off-shore procurement program.

(3) Ammunition.

The US Govt considers ammo as one of the highest priority items in off-shore procurement programming, provided price and quality are acceptable to the US. The US is principally interested in procuring US types of ammo, but substitution of other types is not excluded. Subj to the foregoing considerations, the US is prepared to purchase in France upwards of $99 million of ammo.

The foregoing are the principal items mentioned in the May 6 memo for which the US is prepared to undertake off-shore procurement in France during the fiscal year 1953. Nevertheless, during the course of the refinement of the fiscal year 1953 off-shore procurement program, it may be possible to consider certain other items referred to in that memo. However, the US is not in a position at this time to make any further firm commitments, particularly in view of the limited amount of funds available during the fiscal year 1953 as a result of Congressional cuts in appropriations.

It should also be understood that the foregoing statement refers only to the proposals made in the May 6 memo, and is entirely apart from any other off-shore procurement which may take place during the fiscal year 1953. End text.

2. Pursuant auth given Deptel 211, July 11,⁵ I also handed Pleven fol informal memo re previous aid to France and IC.

Begin text. (1) In connection with your discussions re def production problems, it may be useful to summarize the extent of recent US econ and military assistance to France and Indochina.

(2) As you will recall, in accordance with the understanding reached between the Fr and US Govts last Nov, the US Govt was to make available a total of $600 mill to the Fr Govt during the period July 1, 1951–June 30, 1952. It was agreed at Lisbon that of this sum, which rep the max commitment that cld be undertaken by the US Govt, $500 million wld be in a form which wld provide support to the Fr Govt’s 1952 milit budget of 1400 billion francs, including Indochina. This commitment has been fulfilled in the Fol manner:

• (Millions of dollars)
• Econ (MSA) assistance—270.
• Off-shore purchases in France of items included in Fr 1952 milit budget (pursuant Lisbon agrmnt)—177.
• Funds made available for purchases in the US of milit items for Indochina—53.
• Total budget—supporting aid—500.
• US milit expenditures in France (in excess of)—100.
• Total (in excess of)—600.

In addition, a very large amount of military aid for France and Indochina was programmed from US fiscal year 1952 funds which amount is included in the total dollar figure contained in paragraph 4 below.

(3) As the North Atlantic Council was recently confidentially informed, $683 million of off-shore procurement contracts were placed in Europe during the US fiscal year 1952. Of this amount $335 million, or nearly half, were placed in France. This latter figure includes the $177 million of OSP contracts referred to in the second para of this memo. Thus, it may be noted that the amount of off-shore procurement placed in France over and above the Lisbon program is $158 million. The greater part of these contracts was let during the last two months.

(4) As you know, by far the largest volume of US aid to France and the Fr Union is being provided under the Mutual Def Assist agrmnts of Jan 27, 1950, and Dec 23, 1950, and the amount of military aid programmed (Subj, of course, to any reallocation that may become necessary) by the US in the US fiscal yrs 1950, 1951, and 1952 is in excess of $4 billion, including $500 million for Indochina. Pursuant to these programs, a large volume of end items has already been delivered.

(5) It is hoped that the foregoing info will be of value in indicating the extent and nature of US assistance to France and Indochina. End text.

3. Summary my conversation with Pleven being reported in separate telegram.⁶

Dunn

1. This Department of Defense telegram, which had the concurrence of the Department of State, DMS, and MSA, advised the Embassy in Paris that it could inform the French that the United States would immediately support the Pleven proposals of May 6 in the amount of $86.54 million for aircraft and $99.8 million for ammunition and that the United States was not in a position at this time to make any further commitments. (751.5 MSP/7–952)
2. For a summary of this memorandum, see Document 516.
3. Transmitted to the Department of State in telegram 61 from Paris, supra.
4. A summary of this North Atlantic Council meeting of July 9 was sent to the Department of State in telegram Polto 36 from Paris, July 9. (740.5/7–952)
5. This telegram authorized the Embassy to inform the French Government that the total amount of military aid for France and Indochina programmed for fiscal years 1950–1952 in the Mutual Defense Assistance and Mutual Security Programs was in excess of $4 billion, including over $500 million in military aid for Indochina. (751.5 MSP/7–752)
6. Infra.