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

740.5/4–753: Telegram

No. 591
The Acting Secretary of State to the Embassy in France¹

secret

Washington, April 10, 1953—6:22 p.m.

5181. Cotel. For Ambassador. Department has been discussing French aid situation other agencies, and agreement has been reached bilateral talks will be held with British and French by Secretary and colleagues in Paris in connection NAC meeting, to inform them FY 1954 aid possibilities. Department’s thinking outlined below. This for your information and should not under any circumstances be presented French prior Secretary’s arrival Paris. We are now in process clearing inter-agency position paper² for Cabinet use along these lines:

Agree general conclusions your 5364³ regarding possibilities French financial contributions 1953 and 1954. Question remains informing French regarding possible amounts external assistance so they can assume realistic AR position regarding force levels and come grips IS recommendations on possibilities internal economies.

French Government to be informed as follows:

US will seek provide $525 million FY 1954 aid support French budget on understanding French budget for NATO forces as well as expenditures Indochina will continue same level if not increase 1954 over 1953. In this connection agree we should emphasize importance French taking measures support and expand level economic activity France. Furthermore this level aid must be related French performance in field forces, as well as finances. Therefore US position should be reemphasized in support SHAPE and IS recommendations on reorganization Army support units, development 1953 ground and naval forces at levels proposed last December and as first priority increased French emphasis front-line air force. If French within own budget supported by $525 million US aid can go further and finance activation 15th division US hopes be able to supply end-items for it.

We should also be assured ASIC budgets can be further increased 1954 to cover part additional cost further ASIC force buildup.

US would also agree in principle provide additional aid toward remaining gap in financing new ASIC force buildup, with understanding this aid intended finance net new military effort Indochina. Precise amounts necessary will depend upon JCS evaluation new plan as well as further screening and development information regarding costs and ability Viets spend additional funds Indochina. (Costing tables pouched Timmons April 3.) Indochina matter to be discussed with French but see no necessity do so in context NATO AR, aside from making point indicated above regarding maintenance French contribution Indochina.

If French raise question, US would not be in position provide additional FY 1953 aid for NATO program. However US would wish clarify status whether French continue require $30 million to cover conditional tranche Indochina budget 1953, in view potential availability blocked funds mentioned your 5358.

Your comments foregoing appreciated.

Smith

1. Drafted by Beigel and cleared with Merchant, Moore, MacArthur, Bonsal, and E. M. Martin. Repeated to London and Saigon.
2. Presumably a reference to a speaking and position paper drafted by Beigel for the U.S.–French talks in Paris. A copy of this paper, entitled “Aid to France Including Indochina” and circulated as document TIP D–1/2 of Apr. 15, is in Conference files, lot 58 D 95, CF 152.
3. This telegram was a two-part message reporting on economic and financial aspects of the currently available Annual Review documents concerning France. (740.5/4–753)