The Minister in Egypt (Kirk) to the Secretary of State
[Received 2:51 p.m.]
417. Department’s 291, February 20, 5 p.m. After consultation with Jidda, consensus of opinion is that Ibn Saud will doubtless welcome announcement of eligibility of Saudi Arabia to Lend-Lease but likely immediately to rouse question of obligations of Saudi Arabia thereunder and nature of extent of practical benefit to be gained therefrom. It has also been suggested that personal and direct [Page 861]presentation of matter to King [would be] advisable for reasons of both effectiveness and courtesy and therefore it might prove desirable for either Moose55 or myself to proceed there for that purpose. Accordingly please advise urgently when Moose is arriving.
I assume direct aid is to be extended rather than utilizing method of retransfer from British. Certainly through direct aid we would be given more credit for our efforts to be of assistance and I strongly recommend this method be used.
Question will naturally arise regarding payment for Lend-Lease goods. I suggest in this connection that usual method of delivery of goods under plan for postwar settlement be followed in view of Saudi Arabian financial situation. In other Middle Eastern countries Lend-Lease goods are sold for cash as means of combating inflationary tendencies resulting from large war expenditures but entirely opposite situation prevails in Saudi Arabia.
As to nature of Lend-Lease aid to be extended, please see Legation’s number 412, February 24, 8 a.m.,56 from Rountree57 advising allocation by Middle East Supply Center of 60 trucks to Saudi Arabia. These trucks could be delivered immediately as Lend-Lease transaction and would provide an excellent initial taken [token?] of American aid. Delivery, however, must be made at once because of pressing demand for motor transport to move foodstuffs in Saudi Arabia and could not wait negotiation of a Lend-Lease agreement. If it is deemed necessary, however, situation might be met by signing separate interim and tentative agreements for this and each succeeding obligation incurred under Lend-Lease deliveries.
Another possibility of immediate aid would be furnishing of equipment for irrigation project ordered for the Saudi Arabians by California-Arabian Standard Oil Company. This equipment, delivery of which is supported by MESC and is vitally important, is now under commercial order in the United States but could be taken over by Lend-Lease.
Although I consider it of utmost importance to be able to associate initial Lend-Lease discussion with King with concrete proposals for immediate aid such as suggested above, generally speaking, effort would be made to avoid raising exaggerated hopes of King and it would be explained that our efforts to be of assistance would be contingent upon approval by MESC as in the case of other countries of the area and current limitations in respect of supplies and shipping.
In summary I would recommend that aid to Saudi Arabia should be on direct Lend-Lease basis with the understanding that arrangements [Page 862]for payment will be made later and that steps be taken to give immediate effect to declaration by placing above-mentioned delivery of trucks under Lend-Lease and considering similar action in respect of pumps with understanding that other recommendations will be made as the situation develops.
Winant and Rountree concur in the foregoing. Please advise urgently Department’s and Office of Lend-Lease Administration’s opinions and instructions in order to facilitate adequate presentation of matter to King as soon as possible.
Immediately prior to notification to King, I propose informing Minister of State here of our intended action and suggesting that our Chargé at Jidda similarly advise his British colleague.
Repeated to Jidda.