Foreign Relations of the United States: Diplomatic Papers, 1944, General: Economic and Social Matters, Volume II

840.50/8–2344

The British Embassy to the Department of State

Aide-Mémoire

In H.M. Embassy’s memorandum of 17th August on the handling of requirements for reconstruction in Europe, reference was made to the possible establishment of a European Economic Committee in London. H.M. Government have been giving further and urgent consideration to this question and feel that an amplification of their views might be of interest to the U.S. Government.

2. Just as, in matters of relief and rehabilitation, the basic principle of the United Nations Relief and Rehabilitation Administration is to help the liberated countries to help themselves, so in H.M. Government’s view should this principle guide the approach to the problems of reconstruction. The Anglo-American supply machinery is already strained for the prosecution of the war and the maintenance of the civilian economies of the countries from which supplies are drawn. It is therefore essential that every possible resource in Europe should be utilized to the full before further demands are made on the overseas sources. From this it would follow that the liberated countries of Europe should first formulate and attempt to harmonize their policies in the economic field and to define what may be needed from outside the Continent of Europe before demands for these needs are placed on outside resources. Only after such consideration should the Anglo-U.S. supply machinery be called in to assist.

3. If however the principle which has been enunciated above is to be put into effect there must be established an organisation in Europe through which the necessary consultation between European Allied countries can be achieved. It was with this in mind that H.M. Government put forward the proposal for a European Economic Committee. In such a Committee representatives of the European Allies under the joint guidance of the United States, the Union of Soviet Socialist Republics and of the United Kingdom could discuss such matters as their several intentions in the matter of economic policy, the manner in which they propose to help one another and the extent of their initial commercial intercourse with neutrals. The Committee would, for example, consider such matters of common concern as the national agricultural and industrial policies of the various European countries and their effects on their neighbours. They would discuss the respective claims of countries represented on the Committee to materials and goods in short supply. In support of their request for help from outside Europe the countries will wish to, and indeed should, demonstrate that they can and will institute all proper safeguards to ensure not only that maximum use is made of resources available in each domestically but also that what is received through the offices of Anglo-U.S. supply machinery is used to fullest advantage. The Committee would exchange views and information accordingly on the measures which each contemplated within its boundaries in such matters as rationing, distribution, grain collection and dehoarding, black market, and kindred measures necessary for the orderly reconstitution of their economies.

4. It would then be necessary to consider, in the light of knowledge of the intentions, proposed policies and denned needs of the European countries and in the light of the views expressed by the American, British and Russian representatives on the European Committee, to what extent it was desirable to meet European countries’ requests through the agency of Combined Supply machinery, and on what terms. One of the terms of help would naturally be that the applicant countries should undertake to make their purchases from sources, in quantities, and according to methods, acceptable to the governments represented on the Combined Boards and, where desired, should find for the Boards raw materials, finished goods, capacity and even manpower from resources at their disposal. These matters could best be discussed in Washington through the media of the consultative bodies already established by the U.S. Government and H.M. Government, in which in some cases the Government of Canada participates.

5. Some steps have already been taken which might assist in the evolution of the proposed Committee. Economic Liaison Groups for France and Belgium respectively have been set up in London with the assistance of the U.S. Government in conjunction with both the French authorities and the Belgian Government. The purpose of each of these two Groups has been to afford a means for free discussion of economic questions affecting French and Belgian interests. They have formed a most useful means for full and informal discussion of problems both relating to the overseas empires of these two countries and to the general economic problems likely to be faced after liberation of metropolitan France and Belgium. It has always been understood in these Committees, however, that major questions of policy relating to the work of the Combined Boards would be resolved in Washington and formal tripartite bodies were established in Washington for this purpose.

6. H.M. Government has had under consideration the establishment of similar Economic Liaison Groups with the Dutch and Norwegian Governments. Once these two additional groups were established, these Economic Liaison Groups could rapidly be developed into a pluripartite organisation which might become the nucleus of a European Economic Committee. The march of military events in Europe makes it, in the view of H.M. Government, a matter of extreme urgency to press forward with every step that may be of assistance to the end of establishing the widest possible form of collaboration on economic matters between European countries. There may be considerable areas or even whole countries in which there will be no military period as it has been understood in the past. These would be hiatus areas for which, apart from procurement undertaken under Plan A,⁶ no one has any defined responsibilities. In view of military developments H.M. Government considers that the establishment of these two further groups should be undertaken as a matter of urgency.

7. If the U.S. Government should agree with the setting up of Economic Liaison Groups for the Dutch and Norwegian Governments with a view to their early amalgamation with the existing Groups, H.M. Government would propose forthwith to invite the Norwegian and Dutch Governments to participate. Simultaneously H.M. Government would suggest that the U.S. Government should join with them in proposing the formation of the European Economic Committee to the Union of Soviet Socialist Republics.

8. It would moreover seem to be desirable to make arrangements for informal consultation between the United States, United Kingdom and Soviet representatives on the proposed economic committee so that there might be a full exchange of views between these three Governments as to the best advice and guidance to be given to the other European countries represented on the Committee on economic matters. Subject to the agreement of the U.S. Government, H.M. Government would therefore suggest that:

(a) the Soviet Government be consulted as soon as possible about the establishment of the European Economic Committee

(b) the Soviet Government be informed of the desire of the U.S. Government and H.M. Government to arrange for informal consultation between the three Governments on subjects within the terms of reference of the European Economic Committee, and

(c) the Soviet Government be further informed that the U.S. Government and H.M. Government have already taken steps to set up a Combined Liberated Areas Committee⁷ whose primary task will be to coordinate Anglo-U.S. action for making available the combined supply machinery in meeting where they can the needs of European countries.

Washington , 23 August, 1944.

6. Plan A represented a set of figures with respect to a program of supplies (for all the areas of Europe to be liberated) which was produced by a working party of representatives of the Department of State, the Foreign Economic Administration, and the International Division of the Army, which was given official approval by the Combined Civil Affairs Committee on February 17, 1944; for further information on this subject, see an article entitled “Supplies for Liberated Areas”, in the Department of State Bulletin, May 20, 1944, p. 469.
7. For documentation on this subject, see pp. 301 ff.