868.50/7–1846: Telegram
The Ambassador in the United Kingdom (Harriman) to the Secretary of State
[Received 8:05 p.m.]
6804. Embtel No. 6798.41 Hayter Head of Southern Department in Foreign Office has now given us orally the following additional information about the talks the Prime Minister and his Mission had in London.
[Page 184]Economic Matters
The British Government welcomed visit of Prime Minister and his party but British had not expected to engage in very detailed discussions with Mission or to receive any specific requests from Greeks for aid. Foreign Office was therefore somewhat surprised when in visit Prime Minister indicated he wanted to present a memo to British on subject of Greek economic reconstruction. Memo turned out to be “a most formidable document” and Greeks asked for a quick reply.
Briefly the memorandum copies of which being forwarded Department via airmail shows aim of the 5-year Greek reconstruction program to be twofold:
(a) The restoration of Greek economy to its pre-war level and; (b), its further development through the exploitation of new resources.
To accomplish first aim memorandum says something over 6 billion dollars are required to be used as follows:
- 1.
- Replacement of capital 5 billion dollars.
- 2.
- Deficit of balance of payments for 5 years 600 million dollars.
- 3.
- Deficits of budgets for 5 years 440 million dollars.
Achievement of second aim memo states presents an opportunity for financial investment in Greece by the western allies.
Immediate British reaction to Greek request to cover material damage was that this figure was far too high and that it was too much to hope that Greek economy could be straightaway restored to its prewar level. This view was explained to Greeks as well as fact that most countries of world had been weakened by the war and that it would hardly be possible to restore the economies of any of them to their prewar level immediately. The Greeks were given to understand that certainly nothing like the sum of 6 billion dollars would be available from Britain for use in Greece. It was, however, suggested to the Mission that Greeks themselves should work out a practicable plan for economic rehabilitation of their country with statement of their needs in way of external financial assistance and that they might then present this to some international financial agency. (Hayter mentioned specifically International Bank of Rehabilitation and Reconstruction.) Greeks agreed to follow this suggestion.
British told Prime Minister they would undertake to purchase surplus stocks of tobacco presently held in Greece as well as this year’s crop. Most of this tobacco will probably be used in British zone in Germany though some will be brought to Great Britain.
Greeks were told that British would be glad to assist them in arranging transfer of flags on any old merchant vessels Greeks might purchase. Greeks have considerable money in London representing insurance on Greek ships sunk during war.
[Page 185]Political Matters
Greek Prime Minister is much disturbed about infiltrations and clashes occurring on Albanian-Greek frontier. These incidents were discussed with British and Prime Minister advanced suggestion situation might be called to attention Security Council. British advised Greeks not to do this and suggested instead that Greeks endeavor to solve these frontier troubles through negotiations with Albanians. Greeks were willing to try this but asked for British help in approaching Albanians. British explained they were unable to assist as they do not recognize Albanian Government. Greeks then said they would probably follow British suggestion that they enlist support of US representative in Tirana.
In a general and preliminary way British discussed with Greeks plans for turning over administration of Dodecanese Islands to Greek authorities after Italian Peace Treaty becomes effective. British indicated that in meantime they will probably permit some Greek liaison officers to be attached to British Military Government in the island. British are now drawing up detailed plans for turning over administration of islands but these plans will be presented to Greeks later.
Without giving any indication of support in Greek territorial claims on Albania and Bulgaria British told Greeks that they would do all possible to see that these claims received a full hearing either at Peace Conference or Council of Foreign Ministers or both.
[Here follows discussion of internal Greek political affairs and of civil aviation in Greece.]
Sent Department as 6804; repeated to Athens as 99.
- Dated July 18, not printed.↩