890F.51/29: Telegram

The Secretary of State to the Minister in Egypt (Kirk)

399. Your 1004, July 23, 1 p.m., and previous telegrams on the question of extending financial assistance to Saudi Arabia. The Department has examined this matter from every angle and it has received the consideration of the President, the Secretary of the Navy, [Page 646] the head of Lend-Lease, and the Federal Loan Administrator. The sum and substance of the conclusions reached are that this Government is not in a position to make any advances to the Saudi Arabian Government or to buy any Arabian oil whether produced or in the ground. The President requested Mr. Jesse Jones to inform the British of his hope that the British could take care of the financial needs of King Ibn Saud. Mr. Jones did so and made the request that the British Government supply to the King such funds as it should feel are desirable and necessary.

In replying to the note of the Saudi Arabian Minister of Foreign Affairs transmitted by your 825, June 26, 4 p.m.,33 you are authorized to state in substance as follows:

This Government fully realizes that the existing international situation has affected Saudi Arabia in a manner to cause financial problems. As the Saudi Arabian authorities are doubtless aware, the United States Government and the British Government are currently extending economic and financial assistance to certain countries, and this country is affording assistance to Great Britain on a very large and comprehensive scale.

The question of furnishing a credit to Saudi Arabia has been given the most earnest and sympathetic consideration by the President and high-ranking officials. However, it is felt that owing to the large number of countries and the vast extent of the areas included in the program of economic assistance, it is impracticable for this Government to cover the entire field, and a division of effort is necessary. In this connection, it is understood that the British Government has already afforded financial assistance to Saudi Arabia.

Needless to say, the continued independence of Saudi Arabia and the well-being of its people are considered to be of great importance, and the Government of the United States has the highest appreciation of the achievements of King Ibn Saud in unifying and developing his country and maintaining its liberties. On the other hand, the Saudi Arabian Government will doubtless appreciate that it is natural and logical for this Government to devote its main efforts toward assisting those countries which are actively resisting external aggression, or which for geographical reasons are important to the national defense.

The Saudi Arabian Government may feel that there are other ways in which this Government could be of assistance, in which case they could be discussed with the American Minister on the occasion of his forthcoming visit.

  1. See footnote 23a, p. 638.