860F.51/5–3146

Press Release Issued by the Export-Import Bank of Washington, May 31, 1946

Export-Import Bank Announces Cotton Credit to Czechoslovakia

Approval by the Board of Directors of the Export-Import Bank of a credit of $20 million to the Republic of Czechoslovakia to finance the purchase of raw cotton in the United States was announced today by Mr. William McChesney Martin, Jr., Chairman of the Board.

This cotton credit to Czechoslovakia is the fourth allocation to be made from a general credit of $100 million established by the Export-Import Bank in October 1945 to finance the shipment of cotton to European countries. The earlier allocations under this credit were $5 million to Finland, $25 million to Italy, and $10 million to the Netherlands. The Bank has also extended a special cotton credit of $33 million to China.

The terms of the credit to Czechoslovakia are in general similar to those of other cotton credits established by the Bank. The rate of interest is 2½%. The maturity of drafts under the credit will be 26 months from the date of issuance in the United States, in consideration of the time required for inland transportation and the special difficulties facing the production and marketing of cotton textiles by Czechoslovakia.

The cotton credit to Czechoslovakia is designed to assist that country in reconstructing its economy. It will supply the raw materials for one of its important industries and help to make possible the resumption of its former position in world trade. If the entire amount of the credit is utilized, it will provide for the shipment of approximately 130,000 bales of cotton. This is more than half the volume of cotton imported annually by Czechoslovakia from the United States in the years immediately preceding the war and is estimated to equal about two-thirds of the current annual cotton requirements of the country.

In making the announcement of the cotton credit to Czechoslovakia, officials of the Export-Import Bank emphasized that the credit will [Page 204] not become operative until the necessary loan agreement has been signed.42 A further announcement of the details of the credit will be made at that time.

  1. Telegram 872, July 8, 1946, to Praha, reported that the Export-Import cotton credit agreement had been signed by Czechoslovak representatives on July 3 (860F.51/7–346).