740.00119 EW/11–945
The Secretary of State to the Ambassador in France (Caffery)
5244. For Angell Number 15. As you know, US Govt has taken position in discussion of Italian Peace Treaty that any reparation demands on Italy should be confined to removal of such equipment for production of war material as is surplus to Italian needs in light of armament provisions of treaty and cannot readily be converted to peace time use. It seems unlikely that much equipment could be removed under this formula. Furthermore, what is removed would probably not be susceptible of use for reconstruction purposes by countries which suffered from Italian aggression.
US position regarding Italian reparations based upon manifest impossibility of extracting reparations from Italy without increasing economic distress there and imposing further burden on those contributing to Italian relief and reconstruction particularly US. However, it would be highly desirable that some recognition be given to claims of Greece and Yugo, countries which suffered most notably at hands of Italy, and Dept is of opinion that some weight might be given this factor in determining Greek and Yugo shares in German reparations.
Dept appreciates that introduction of factors other than those relating to war against Germany, at least in formal way, would undoubtedly greatly complicate negotiations for determination of shares in German reparations. However, since percentages will in final analysis be determined by negotiation, you will probably have opportunity to lend support to Yugo and Greek claims without necessarily bringing matter up in such way as to confuse question of statistical basis upon which allocations might be made. Exact manner in which subject shall be dealt with left to your discretion. Furthermore, while it is desirable that Greeks and Yugoslavs should, at some point, be given to understand we are seeking to obtain some weighting [Page 1378] of their claims against Germany in light of Italian inability to pay reparations, Dept must likewise rely upon your judgment as to timeliness of any discussion of matter with Yugo and Greek representatives.
You may find it advantageous to discuss matter in near future with Brit and French. In doing so, you will appreciate that foregoing ideas relate only to Greek and Yugo shares. Dept does not feel that position of any other countries is such as to warrant consideration of their claims against Italy in connection with determination of shares in German reparations.