711.91/7–3146: Telegram
The Ambassador in Iran (Allen) to the Secretary of State
[Received 9:09 p.m.]
1049. Shah reverted at length yesterday to his favorite theme that only hope for Iran to withstand continued Soviet propaganda among Iranian masses is economic development to raise standard of living. He emphasized especially development of water power and he hopes American firms will become interested from investment and management point of view. He said principal necessity is large American loan, which he realizes we will not extend if Iran seems likely to become Soviet puppet state but he is convinced loan is Iran’s only hope.
I repeated necessity for specific plan of development and for detailed projects before loan could be considered. He said comprehensive 7-year plan is practically ready.
I expressed personal view that most likely means for Iran actually to obtain American credits seemed to me through individual projects sponsored by American companies such as airway project by TWA, electric power project by Westinghouse, communications project by International Telephone and Telegraph, etc.
We have every reason, in view of Declaration Regarding Iran and for other reasons, to consider sympathetically Iranian requests for economic assistance and Shah’s views concerning raising standard of living are excellent.
[Page 510]Any guidance Department may give me on this subject will be welcome.77
- In telegram 760, September 12, 1946, the Department advised the Ambassador in Iran that the Export-Import Bank could not consider more than a small loan to Iran because all but a small part of its resources had been committed to meet relief and rehabilitation needs of war-devastated countries, but stated that “the new International Bank is institution designed to handle long-term loans for major development projects such as Shah’s 7-year plan.” (891.51/9–1246)↩