867.51/10–1845

The Secretary of State to the Ambassador in Turkey ( Wilson )

No. 788

The Secretary of State encloses for the information of the Embassy a copy of a note recently presented by the Turkish Ambassador to the Department,37 likewise copies of memoranda of conversations,38 all [Page 1310] in reference to an Export-Import Bank loan to the Turkish Government. While these documents are largely self-explanatory, it should be noted, nevertheless, that officers both of the Department and of the Eximbank stated to Ambassador Baydur and his associates that there was little hope that a loan of the amount requested could be made to Turkey. Furthermore, Ambassador Baydur was informed that the interest rate of 2⅜ percent mentioned in the Embassy’s note was given only on loans of limited amount to liberated and war-devastated countries which had lend-lease agreements with the United States. No specific rate on loans to Turkey was mentioned by Mr. Taylor39 but for the conventional information of the Embassy, the rate on loans, if granted, is likely to average about 3% with varying rates on serial notes of different maturities. Ambassador Baydur was assured that Turkey would receive equal treatment with other nations in regard to the terms of loans.

In view of the present financial position of Turkey and the substantial economic progress of recent years the Bank, in all probability, will make loans to Turkey if satisfactory projects are presented. At least, all requests for loans will be given sympathetic consideration by the officials of the Bank. Nothing can be done at this time either by the Department or the Bank until the requested information is received both on projects and on the financial position of the Turkish Government. It is expected that this information will be furnished shortly. Ambassador Baydur and Counselor Yazici were apparently well satisfied with the reception given them by Mr. Taylor and it can confidently be expected that relations between the representatives of the Turkish Government and officers of the Bank will be on a friendly and cooperative basis.

  1. Not printed. The proposals presented in this note were the outcome of plans for increasing the economic and commercial relations of Turkey with the United States which were brought to the attention of the Department in telegram 581, April 28, 5 p.m., from Ankara (not printed), in which the Chargé (Earl L. Packer) repeated a conversation with the Turkish Acting Minister for Foreign Affairs (Sümer). (641.6731/4–2845) The present note declared the intention of the Turkish Government to plan for the thorough industrialization of the country. To accomplish this the Turkish Government was anxious to secure a credit in the United States of $500,000,000 at 2⅜% interest. The suggestion was made that the annual repayments would not impose hardship on the Turkish economy, and there was persuasive comment that Turkey would foster greatly increased trade with the United States, would consider taking steps for the complete abolition of the export tax, and for the reduction of the prices on export goods. The note closed with expression of gratitude for any assistance which might be given in the negotiation of a credit with the appropriate United States authorities. (867.51/10–245)
  2. Memoranda not printed.
  3. Wayne C. Taylor, President of the Export-Import Bank of Washington.