181. Memorandum of Conversation0
SUBJECT
- Preparations for EPC Meeting and IMF Council Discussions
PARTICIPANTS
- Mr. Robert V. Roosa, Under Secretary of Treasury for Monetary Affairs
- Mr. Walter Heller, Chairman, Committee of Economic Advisers
- Mr. Arthur W. Marget, Board of Governors, Federal Reserve
- Mr. Jack N. Behrman, Deputy Assistant Secretary of Commerce
- Mr. R. Henry Rowntree, Chief, Economics Division, Export-Import Bank
- Mr. John Leddy, Assistant Secretary for International Affairs, Treasury
- Mr. George Willis, Director, Office of International Finance, Treasury
- Mr. Edwin M. Martin, Assistant Secretary, State
(I received a message late Friday, March 17, from Mr. Willis of Treas-ury that Mr. Roosa would have a meeting on Monday to consider new international financial arrangements. On Monday morning I received a message from Mr. Leddy that the meeting had been called because of concern by Secretary Dillon that a working group set up by CEA under Mr. Triffin to prepare for EPC meeting might get involved in international financial planning of the sort which was properly the responsibility of the NAC.)
Mr. Roosa opened the meeting by saying that he and Secretary Dillon were concerned with two points. The first was that in any international discussions, formal or informal, it was imperative that the US representatives speak with a single voice derived from coordinated positions. If there were to be any actual negotiations, they would presumably be handled by representatives of State and Treasury.
The second point was that, insofar as the United States took a substantive position on international financial questions in the course of the EPC meeting, it was important that these substantive positions be coordinated through the NAC, which was the established mechanism for this purpose. I inquired if it weren’t possible that some of the issues involved were similar to those on which Mr. Southard was seeking guidance for use in IMF discussions of expansion of its resources. Mr. Roosa agreed that this was the case. It was, therefore, important not only to have instructions for EPC meeting but also for Mr. Southard on this particular subject.
Mr. Heller indicated that the Triffin group, to which Mr. Roosa had made reference, would be meeting, starting Tuesday morning, March 22, [Page 402] to deal with the question of the coordination of internal financial policies of member governments. Its mandate was confined to this subject.
It was agreed that there were two other subjects on which policy guidance was needed. One was the international financial mechanisms which were needed to deal with problems with particular reference to the role of the IMF and to the possibility of the US becoming a member of the EMA. This was clearly a NAC problem. It was left that Mr. Southard would be asked to prepare a paper on IMF aspects and State and Treas-ury on EMA aspects.
It was also felt that there would need to be a consideration of how better exchanges of views could be organized, particularly among a more limited group of countries than EPC within OECD framework. It was felt that this paper should be drawn on the assumption that the US would not be able to join the EMA as it now exists. It was agreed that State and Treasury would collaborate on this paper. I proposed that the first step might be to send some ideas to Mr. Tuthill for comment. Mr. Leddy agreed and asked that Mr. Abrams or Mr. Renner1 get in touch with him with respect to such a telegram as well as preparation of the paper.
It was generally felt that the first problem would be the most likely subject for discussion in EPC and the other two might be more useful for informal conversation outside the meetings. It was agreed, however, that no formal decision could be taken on this point until the papers had all been seen.
It was agreed that the three papers have relationships with each other and that it will be necessary to examine them together to ensure that they are properly related.
It was agreed that this informal group, representing the NAC agencies at a higher level than the staff committee, but not an NAC body, would deal with paper #2 and with the coordination problem. It was agreed on my suggestion that we should wait until after the coordination had been achieved before deciding which parts of the package needed NAC approval.
It was felt that the three papers should be ready for examination within two weeks.
Neither Exim nor Commerce representatives played any part in the discussion. The Federal Reserve representative spoke strongly in favor of an active NAC role in the whole matter. The conversations were entirely friendly, though Mr. Roosa was firm on the need for clear US positions, even for exploratory conversations.
[Page 403](Immediately after the meeting I informed Mr. Renner of what had transpired and asked him to get in touch with Mr. Leddy. I also confirmed that he was attending the meeting of the Triffin group and suggested in view of the subject matter, he might want to take someone from E. He indicated he had already been in touch with Mr. Goldstein.)2