868.51/1283: Telegram

The Ambassador in Great Britain (Mellon) to the Secretary of State

328. Immediately upon receipt of Department’s 281, November 11, 6 p.m., I communicated its contents to the Foreign Office from which I have today received the following informal letter.

“In response to your telephone call yesterday, I enclose a copy of the instructions to the International Financial Commission at Athens, as they now stand, regarding the execution of their part of the arrangement come to between the Greek Government and the bondholders of the Greek external debt.

I believe I told you on Saturday morning that the Greek Minister had asked that before these instructions were actually issued to the Commission he should be given time to find out from his Government whether they agreed with the terms of the instructions, and that after discussions it was agreed that we would wait until Monday morning for this purpose. M. Caclamanos informed us yesterday that he had no reply to his telegram on the subject. In these circumstances we have no alternative but to go ahead and we shall be telegraphing to the British representative on the Commission that he is authorized to regard the draft instructions (which he has already received in bits) as substantive and effective. We are at the same time asking the French and Italian Embassies here to move their Governments to send similar authority to the French and Italian representatives on the Commission at Athens.

All this is explained in an official note we are sending you in reply to your memoranda of November 1st and 12th, so that in forwarding the enclosed instructions to Washington you may like to warn the State Department that this official note is coming along. I am sorry we cannot get it to you in time for the pouch today.”

Text of instructions referred to therein is the same as that quoted in my 320, November 8, noon, except in paragraph 4 the words “by the appropriate machinery” are replaced by “by an arbitration according to article 32 of the law of control” and in paragraph 5 between “35 percent” and “of the total annual interest service” a parenthetic [phrase?] is inserted as follows: “on a gold basis in the cases referred to in the preceding paragraph”.

Copies sent Paris and Rome.