462.00 R 294/367: Telegram
The Ambassador in France (Herrick) to the Secretary of State
Paris, July 5,
1924—1 p.m.
[Received 3:05 p.m.]
[Received 3:05 p.m.]
329. L–188 [from Logan].
- 1.
- Reference Belgian allocation for Army costs, account of 25 percent of deposit in Caisse des Gages, have just received letter from assistant delegate offering to deposit in proposed special [account] the following sum: 188,199,000 [88,199,000?] French francs; 8,275,000 Belgian francs; 303,000 Swiss francs; 2,900,000 [2,902,000?] florins; 29,000 pounds; 203,000 lire; and $1,170,000.55
- 2.
- Belgian letter states, however, that it considers that the exchange rate should be computed as of the day currencies were received by Belgium and credited at the same value as they were debited to Belgium. The sums above referred to were received on May 25, June 16 and June 26, three-fourths of the total on the first date and approximately one-eighth on each succeeding date. There was debited to Belgium on May 25, 91,000,000 gold marks, on June 16, 16,000,000 gold marks, on June 29, 20,000,000 gold marks. Total debited 127,000,000 gold marks. Belgium wishes to debit our contingent Army costs account 31,750,000 gold marks in return for the deposit in the special account of all the foreign moneys listed above. Belgian letter points out that they have long been ready to deposit these sums and that therefore they should not suffer any loss because of falling exchange. Also understand that foreign treasuries would like to avoid the extensive effect on exchange of the immediate conversion of the sums mentioned above.
- 3.
- First request has some plausibility in view of the fact that had we previously accepted Belgian offer sums would have been deposited as received. Perhaps situation could be somewhat reconciled by crediting Belgium as requested but crediting Germany only with dollar values actually received. The request concerning delaying conversion is somewhat inconsistent but suggest that this subject be referred to the Treasury to determine whether there is not some method of exchanging the funds with minimum effect on market.
- 4.
- Have expressed no views to Belgian authorities on either of foregoing requests and am conducting all subjects relative to this proposed special deposit by correspondence, in instant case [present instance?] merely acknowledging letter and stating that response will be made upon receipt of instructions. Logan.
Herrick