868.50/9–746: Telegram
The Acting Secretary of State to the Ambassador in Greece (MacVeagh)
secret
1112. Discussions with Greek Economic Mission followed general tone outlined Deptel 1002 Aug 14 to Athens, London 6041, Paris 4091. During informal conversations63 just before Mission’s departure, while stressing US friendliness to Greece and fact US Govt had no intention interfering Greek internal affairs, I said frankly that US can do little toward long-term aid to Greece if Greek Govt unwilling or unable to take measures in order conserve Greek resources and lay basis for immediate economic reconstruction. Feeling in US Govt circles that Greece has not taken all steps to conserve or make best use of gold and foreign currency resources in Greece or of resources Greek Govt and citizens outside Greece; that sterner measures could have been taken during postwar period to prevent profiteering and to tax profiteers from occupation period. Also question whether Greek tax structure corresponds to present needs.
Although no commitments made, it was informally agreed that possibility sending small top flight economic and financial commission to Greece in near future if requested by Greek Govt would be presented to National Advisory Commission.
I reiterated general policy US Govt that International Bank should be principal medium for flotation loans for reconstruction or development. Also indicated Int. Bank expected to be able extend credits within few months and was already receiving loan applications.
It was agreed that any specific suggestions or advice as to methods whereby Greece could improve economic conditions would be embodied in memorandum transmitted through Greek Emb to Athens and not in Dept’s press release. Copy of memorandum when prepared will be transmitted to you by Dept.
You may use this info as background for discussions with Greek officials whenever appropriate.
For your info only real effort was made by both Dept and Treas to make Mission aware that basic long term policy of US aimed at elimination foreign exchange restrictions and controls does not mean that US fails to recognize desirability use effective control measures during next few years by countries like Greece which should husband all available gold and foreign exchange resources for essential reconstruction purposes. In this connection it was intimated to Mission [Page 202] that US failed to comprehend wisdom present Greek monetary policies such as gold sales, and unrestricted monthly remittances up to £100, which dissipate vital Greek foreign exchange resources.
Conversations members Mission indicated possibilities substantial export tobacco also currants, strengthened OFD view that if Greek Govt marshalls Greek resources it is possible for Greece to meet needs for current consumption from home production plus proceeds exports, remittances etc. Conversations mentioned ineffectiveness Greek Govt organizing reconstruction work.
Sent Athens 1112, rptd Paris as 4672 for Sec Del 844, London 6502.
- On August 23.↩