Office of the Historian

150. Memorandum of Conversation1

Bonn, June 9, 1966, 11:30 a.m.

SUBJECT

  • Loan Prepayment

PARTICIPANTS

  • U.S.
    • The Secretary of State
    • Ambassador George C. McGhee
    • Ambassador Llewellyn Thompson, Ambassador-at-Large
    • J. Robert Schaetzel, Deputy Assistant Secretary, European Affairs
  • FRG
    • Chancellor Ludwig Erhard
    • Gerhard Schroeder, Federal Minister of Foreign Affairs
    • Ludger Westrick, Minister for Special Tasks
    • Von Hase, Press Chief
    • Karl Carstens, First State Secretary, Foreign Office
    • Horst Osterheld, Foreign Affairs Adviser

The Secretary made some humorous introductory remarks to the effect that the U.S. was often in the position of asking its friends for help. Now, because of our balance of payments difficulties, we are asking the Germans to prepay 214 million dollars on the GARIOA (Government and Relief in Occupied Areas) and Marshall Plan Loans. Our balance of payments had been bad for the first quarter.

He realized that the Germans had balance of payments problems of their own; however, he hoped that they would give careful consideration to this request. The Chancellor replied that the Germans, of course, had balance of payments problems of their own—more serious, he considered, than those of the U.S. Their deficit would, over the next three years, average a billion dollars a year. It was, however, in keeping with our friendship that the Germans consider any proposal we make.

  1. Source: Department of State, Conference Files: Lot 67 D 305, CF 30. Secret; Exdis. Drafted by McGhee and approved in S on August 12. The source text is marked “Part 5 of 11.” Parts 6 and 8 are printed as Documents 151 and 152. Part 2, a discussion of French and NATO issues, is printed in Foreign Relations, 1964–1968, vol. XIII, Document 176.↩