Memorandum of Conversation, by the Assistant Chief of the Division of Near Eastern Affairs (Kohler)

Participants: Mr. Alexander Argyropoulos, Director of Economic and Treaty Division of Greek Foreign Office and Delegate to International Financial and Monetary Conference.
Ambassador Lincoln MacVeagh, United States Ambassador near the Greek Government.48
Mr. Francis F. Lincoln (FMA)49
Mr. Kohler

Following consultation with Mr. Collado50 with regard to the Greek Government’s request for a dollar loan (Under Secretary’s memorandum of July 28, 1944) I asked Mr. Argyropoulos to call, and talked with him today on the subject in the presence and with the assistance of Ambassador MacVeagh and Mr. Lincoln.

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We reviewed the Greek Government’s previous request of about two years ago for financial assistance,51 the attitude taken by this Government at that time, and the action taken to meet that request by relieving the Greek Government of its principal dollar obligations, i.e., charter hire of the Swedish relief vessels and payment for relief foodstuffs provided from this country, now amounting to about 30 million dollars per year in total. With reference to the present request we assured Mr. Argyropoulos that this Government was anxious to give the most sympathetic consideration to the Greek Government’s needs, both those connected with the payment of its necessary operating expenses during the period of its exile and those connected with the post-liberation reconstruction of devastated Greece. In order properly to evaluate these needs and to determine the methods by which this Government might be helpful it was necessary that we have considerable information additional to that furnished in Mr. Varvaressos’ letter No. 2654 of July 27, 1944. This information should include particularly the breakdown of the Greek Government’s financial position in terms of dollars and of sterling, i.e., we needed to know, on the one hand, the Greek Government’s dollar assets, dollar income and dollar expenditures and, on the other hand, that Government’s sterling assets, sterling income and sterling expenditures. We also needed to know, particularly on account of domestic legal considerations, the use in some detail the Greek Government proposes to make of the requested funds, i.e., was it intended to meet current expenses or as a financial reserve for reconstruction purposes. Finally, we mentioned that Mr. Varvaressos’ paper raised certain questions for which our financial people would require answers, an example being that the Greek Government was apparently being called upon to reimburse the British Government for past expenditures made by the British for relief goods in Turkey. It was suggested that our authorities might be very reluctant to lend money to the Greek Government to enable it to reimburse the British Government for such expenses at a time when the American Government was itself making expenditures at the rate of almost 30 million dollars per annum for Greek relief. Mr. Argyropoulos promptly stated that no such use was intended, and was told in reply that this could and should be made clear by a fuller statement of the actual uses which the Greek Government contemplated making of a United States loan. Finally it was suggested to Mr. Argyropoulos that it would also be useful to have a statement of the financial relationship of the Greek and British Governments, since we understood [Page 222] that the British had expressed a willingness in principle to meet Greek needs for sterling.

Mr. Argyropoulos said that he would telegraph for the desired information and let us have it as soon as received.

  1. The Greek Government was in exile in Egypt.
  2. Division of Financial and Monetary Affairs.
  3. Emilio G. Collado, Chief of the Division of Financial and Monetary Affairs.
  4. For correspondence on this subject, see Foreign Relations, 1942, vol. ii, pp. 798 ff.