Foreign Relations of the United States, 1946, The Near East and Africa, Volume VII

868.50/10–2146: Telegram

The Secretary of State to the Ambassador in Greece (MacVeagh)

confidential

Washington, October 31, 1946—8 p.m.

1409. Urtel 1428, Oct 21.²⁸ One principal purpose Mission will be study Greek economy and recommend Greek Govt steps for effective utilization Greek resources improve internal conditions. Some recommendations will relate to measures to be carried out by Greek Govt alone without outside assistance as well as measures dealing with problems where assistance will be needed. Dept shortly transmitting Venizelos via Emb Washington preliminary memorandum²⁹ outlining program deemed essential for economic recovery, including steps to: (a) stimulate exports; (b) maximize domestic production essential commodities; (c) reduce non-productive govt expenditures in order make funds available for reconstruction, and effect reforms govt administration and taxation; (d) obtain control and utilize effectively foreign exchange earned by Greek national economy; and (e) prepare and implement realistic reconstruction program.

Another principal purpose Mission will be to study extent foreign assistance needed. In this connection Dept agrees with your view that Mission should not encourage Greek Govt to expect more credit than it is likely to receive. However, Mission should feel free to examine whatever it believes desirable. To limit Mission to projects of character likely to come before Eximbank or International Bank would be tantamount to assuring Greeks of US support in financing such projects. Greek Govt should understand that study of different segments Greek economy or particular projects does not carry implication of loan. You should, when occasion arises, discourage extravagant hopes in Greek Govt quarters.

Sent Athens; rptd London 7473.

Byrnes

28. Not printed; it noted that the Greek conception of minimum financial needs for reconstruction far exceeded what the United States was prepared to finance through the Export-Import Bank. Ambassador MacVeagh suggested that the projected mission should limit its investigations and recommendations to projects that might be seriously considered for financing by the Export-Import Bank or the International Bank. (868.50/10–2146)
29. Presumably memorandum of October 29, p. 250.