865.51/8–846: Telegram

The Acting Secretary of State (Acheson) to the Chargé in Italy (Key)

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1586. Re Emb A–725, July 15.66 Dept objects limiting dol payments for military exports to period beginning July 1, 1946. Dol payments should be retroactive to cover all military exports from beginning in view Armistice terms do not require Italy pay for such [Page 928]exports. War informed that Dept insists on this principle. Otherwise, Dept has no objection to procedure set forth re dol payment military exports provided in Emb judgement it will give Italy dols for all types exports financed by military and related establishments and give Ital Govt control over such dols and provided that other aspects of procedure are acceptable to Treas and War. Dept discussing subject with Treas and War and further comments will follow. Procedure conforms in principle with Civil Affairs Agreement and can proceed independently reurtel 3318, July 26.67 Emb doubtless aware of Warx 95397 dated July 24, 194668 modifying WX 83569 and establishing dol payment for exports.

Acheson
  1. Not printed; it explained the practice of U.S. military procurement officers in purchasing fruits, vegetables, and other Italian commodities for the U.S. forces in Germany and Austria with lire obtained by cashing dollar checks or by “local procurement”; and it recommended a new procedure of dollar payments to be made directly to the Italian Foreign Exchange Office for the account of the Italian exporter with effective date of the new procedure set at July 1, 1946 (865.51/7–1546).
  2. Not printed.
  3. Not found in Department files.