860H.24/114

Memorandum of Conversation, by the Chief of the Division of Controls (Green) to the Secretary of State

The Secretary: The Yugoslav Minister10 called at my office this afternoon by appointment. He said that he had received instructions from his Government to call on me to request that he be furnished with information to facilitate the purchase in this country by his Government of arms, ammunition, and implements of war as follows:

[Here follows list of war material similar to that given in note of September 19, 1939, from the Yugoslav Minister, printed infra.]

He said that he wished to proceed with negotiations with manufacturers as soon as possible as he had been instructed to close contracts for the purchase of the articles on this list. He asked whether I thought it probable that his Government could obtain credit from American banks or from American manufacturers or whether it would be obliged to pay cash for the proposed purchases.

I told the Minister that, in view of the present situation in Europe, I doubted very much whether any American bank or any American manufacturer would be willing to extend credit for the purchase of arms by a European Government.

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The Minister said that he had expected that answer. He said that he realized that it was hardly to be expected that anyone should advance credit to the government of one of the smaller countries of Eastern Europe in view of the fact that a large and powerful country of Eastern Europe had been completely demolished within a period of two weeks. He said that his Government should have no difficulty in arranging to pay cash as it had removed its entire gold reserve to London last June and that reserve was ample to pay for the intended purchases.

The Minister asked a number of questions in regard to the laws and regulations governing the exportation of arms and I gave him the desired information.

I suggested to the Minister that he immediately address a note to the Secretary, stating that the arms which he proposed to purchase were for the use of his Government only and not for reexportation, and requesting that the necessary export licenses be issued when they were applied for.

The Minister said that he would comply with my suggestion.

I explained to the Minister that the artillery and ammunition in the above list were not at present manufactured by any American manufacturer; that no American manufacturer possessed the necessary plans and specifications to produce such artillery and ammunition; and that arrangements would have to be made with the War Department for that Department to make available plans and specifications to those manufacturers with whom he might enter into contracts for the purchase of those items. I explained that the War Department would undoubtedly be prepared to discuss such arrangements with him as soon as it was assured by the Department of State that the Legation would address to the Secretary of State such a note as that which I had suggested. I said that the War Department would also give him lists of manufacturers of the several items listed with whom he might wish to communicate with a view to the negotiation of contracts.

The Minister said that he would like to take up this matter with the War Department without delay and that he would prepare immediately such a note as I had suggested. He asked whether there would be any impropriety in his communicating a copy of his note to the War Department.

I replied that he was entirely at liberty to give a copy of his note to the War Department. In his presence, I called Colonel Louis Johnson, Assistant Secretary of War, by telephone, told him briefly of my conversation with the Minister, requested that he facilitate the Minister’s mission in so far as such action was consistent with the practices [Page 886]of the War Department, and made an appointment for the Minister to see Colonel Burns of the Office of the Assistant Secretary of War tomorrow morning.

Joseph C. Green
  1. Constantin Fotitch.