890F.24/9–1044: Telegram
The Secretary of State to the Appointed Minister to Saudi Arabia (Eddy)
184. ReLegs 275, September 10, 1 p.m. The actual needs of Saudi Arabia should determine the extent of economic assistance to be rendered under the joint supply program. While reductions should be made as rapidly as circumstances permit, reductions per se constitute an unsound objective if it appears that they will retard the orderly development of a sound economy which will provide the basis for ultimate financial self-sufficiency. Rather than to attempt to adjust the Saudi Arabian budget to an arbitrary reduction it would appear more logical to ascertain whether a sound and reasonable budget will permit reductions in the 1945 program as compared with 1944.
It is believed, therefore, that the Saudi Arabian Government should [Page 743] be requested to submit a budget for 1945 as was done for 1944. A study of this budget should be correlated closely with an estimate of probable importations through normal commercial channels, together with an objective estimate of the relative proportions of goods the King may be reasonably expected to sell and to give away as subsidies to his tribesmen for reasons of domestic political expedience involving the maintenance of law and order.
Stimulation of merchant trade of course will contribute to the attainment of self-sufficiency. However, it is considered that normal trade should expand progressively along general lines rather than with abnormal rapidity with respect to only limited categories of goods such as textiles; that consequently the 1945 supply program should include substantially the same basic categories of essential goods provided in 1944.
Sent to Jidda, repeated to Cairo60 for AEMME.
- Repeated as telegram 2524.↩