890F.515/78: Telegram

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

83. Jordan, British Minister to Saudi Arabia, has requested that we rush shipment of the 7 million riyals minted in the United States. Saudi Arabian Government has deficit of 30 million riyals carried over from 1943 and British expect immediate call for advance of gold sovereigns. Jordan believes he can hold off their demand for a few months if the riyals arrive within a month.

British want to withhold further gold subsidies until a program of fiscal reform has been developed.41 Saudi Arabian 1944 budget calls for expenditures of 109 million riyals, revenue of 37 [million] riyals, leaving deficit of 72 million riyals in addition to 1943 deficit. British believe program for fiscal reform should be introduced in order to avoid payment of large subsidies and expect this question [Page 673] to be taken up at Anglo-American Conference on Middle East, understood to be held soon.

Please cable when riyals may be expected to arrive.

Above for Secretary of Treasury from Mikesell.42

  1. In his telegram 22, January 16, 4 p.m., the Minister Resident in Saudi Arabia repeated a telegram which he sent to the Minister in Egypt (Kirk) in which he stated: “I agree with Jordan as to desirability of fiscal reforms but foresee difficulty in effecting them even if King concurs and possible danger to our interests if he does not.” (890F.515/82)
  2. Raymond F. Mikesell, United States Treasury Representative at Cairo.