867.50 Five Year Plan/15

Memorandum by the Chief of the Division of Near Eastern Affairs (Murray)

In connection with Turkey’s present ambitious industrialization and armament program in the light of her present budgetary situation, a visit which I received yesterday from Ahmet Emin Bey, who has just arrived from Turkey, is of interest.

Emin Bey, who was accompanied by Mr. Melvin Hall, recently employed by Mr. Peek’s organization as a specialist in Near Eastern and Far Eastern trade matters, represents certain American concerns in Turkey—among others, the Curtiss-Wright Company. He stated that he had come to this country unofficially to “study the credit situation”. Upon his return he expects to report to Ismet Pasha, the Turkish Prime Minister, and Celal Bey, the Minister of National Economy. In this connection he informed me that Celal Bey or Ismet Pasha, or both, contemplate visiting this country in the near future. He seemed aware of the fact that this Government would not be disposed to accord any official invitation to either of the above Turkish Cabinet Ministers. He thought, however, that they might come on an invitation from the American Friends of Turkey or some similar organization.

I told Emin Bey that we had been studying the Turkish budgetary situation; that we had noted the considerable increase in proposed budgetary expenditures for the fiscal year 1934–35 and particularly the so-called “secret” budget for war supplies and aviation totalling some 78,000,000 Turkish pounds in addition to the sum of 66,000,000 Turkish pounds provided for in the regular budget. In reply to my [Page 954] inquiry as to the reason for this enormous outlay for armaments, Emin Bey stated quite frankly that his Government had grave fears of Italian territorial ambitions in Adalia. The Turkish Government felt that, despite Mussolini’s reassurances, the only means of blocking Italian designs on this rich portion of Anatolia was to strengthen Turkey’s military preparedness to a point where Italy would not dare to attack her. He pointed out in this connection the disastrous war between Italy and Turkey in 1911, when Turkey’s province of Tripoli in Africa was seized. He stated, also, that in view of the Manchurian incident, Turkey had no confidence in the ability of the League to protect any of its members against forceful invasion. In reply I stated that I thought it was a pity, after Turkey had taken the lead in the Near East in the negotiation of non-aggression conciliation agreements and in a policy of appeasement and friendly understanding with her neighbors, that she should not [sic] consider it necessary to add to the burdens of her already heavily over-taxed people by her present ambitious armament program. I pointed out also that the heavy cost of this armament program would naturally raise some misgivings as to Turkey’s ability to meet the obligations which she wishes to incur in carrying out simultaneously her ambitious five-year industrial program. In view of the tax burden now being borne by the Turkish people and the low standard of living of the country it seemed to me that even with the best will in the world Turkey would find herself eventually unable to meet the large scale obligations which she is now seeking to incur.

Wallace Murray