Office of the Historian

220. Telegram From the Department of State to the Embassy in Vietnam1

Washington, June 15, 1962—8:29 p.m.

1454. Task Force/VN. (a) Embtel 1605; (b) Toaid 1192.2

1.
Following approvals of your requests are given herewith in view of political, psychological and security considerations outlined ref. (a), particularly urgency of security situation and undue GVN preoccupation with fiscal and foreign exchange problems to detriment Counter-Insurgency efforts:
(a)
Issuance of up to $10 million individually coded Counter-Insurgency procurement authorizations (PA/PRs) with elimination multi-code concept for FY 62. Multi-code concept permissible during FY 63.
(b)
Approval in principle of $10 million purchase of piasters at mean rate of $73.50 (see para 2 below).
(c)
Delegation to US AID Director of authority to waive limited worldwide procurement and certain AID Reg I requirements as they apply to up to $8 million Counter-Insurgency procurement authorizations.
(d)
Delegation to US AID Director authority to waive limited worldwide procurement for up to $12 million commercial imports industrial machinery.
2.
Piasters purchased in FY 62 for deposit US account must be committed for specific purposes in FY 62 or they will not be available for use in FY 63 without reappropriation due Sec. 1415 Supplemental Approp. Act. of 1953.3 Best course of action appears postponement actual obligation to FY 63. To extent a specific requirement exists for obligation of piasters in remainder FY 62, this amount can be purchased prior June 30. During negotiations you should make clear that above arrangements do not set precedent for any future cash grants to solve piaster budget problem.
3.
You should make clear that waiver of limited worldwide procurement under paras. (c) and (d) are only possible because of present emergency and should in no sense be considered as precedent for future.
4.
Details of conditions of waivers and certain negotiating and programming instructions follow in separate cable.4 Withhold negotiations until receipt.
Rusk
  1. Source: Department of State, Central Files, 811.0051K/6-1462. Secret; Niact. Repeated priority to CINCPAC for Polad. Drafted by Stoneman, and cleared with Peterson and with AID, DOD, Treasury, and BOB.↩
  2. Telegram 1605 is printed as Document 216. Toaid 1192 has not been found.↩
  3. P.L. 547, July 15, 1952 (66 Stat 637).↩
  4. Document 225.↩