847.24/91: Telegram
The Secretary of State to the Minister in Australia (Johnson)
168. Your 249, May 4, 4 p.m.39 The principle upon which we are working in reverse lend lease negotiations is that each government shall furnish whatever it most efficiently can, determined on practical grounds of availability of materials, production facilities, manpower [Page 546] and shipping. The British, Australians and New Zealanders have raised no objection to this principle but are preoccupied with dollar position of the Empire and its various components. Figures recently submitted by the Australians estimate that the dollar inflow into Australia for pay and allowances and special or incidental expenditures will total roughly 45 million dollars per annum and that Australian expenditures on reverse lend lease will total 160 million dollars per annum. This does not take account of the dollar value of goods furnished Australia under lend-lease which are on a rapidly ascending scale and which totaled over 37 million dollars from July 1, 1941 to March 31, 1942, the total in March alone being $12,860,000. The Australians also estimate that dollar payments for pay of our troops and other purposes now contemplated will change the present dollar deficiency to a surplus. Even should the reverse lend-lease provided by Australia exceed the value of direct lend-lease and dollar payments to our forces, the excess of direct lend-lease to other parts of the Empire over reverse lend-lease indicates the desirability of arrangements between the United Kingdom and the Dominions and they are now discussing such arrangements.
We see no reason why transportation services should not be provided under reverse lend-lease.
Figures given are strictly confidential, balance of telegram for restricted and discreet use.
- Not printed.↩