862.50/5–2947: Telegram

The Political Adviser for Germany (Murphy) to the Secretary of State

confidential
urgent
niact

1284. Personal for the Secretary. Generals Clay and Robertson approved this morning an agreement for the reorganization of bizonal economic agencies. A press release is being issued at noon today in Berlin and it is also understood that Mr. Bevin will make a statement shortly after noon at Margate announcing the agreement and giving a brief outline of it. Berlin announcement will state that agreement has been reached for the establishment of an Economic Council, composed of representatives of the several Laender in the UK and US zones of occupation in Germany, selected by the land Parliaments, to propose for the approval of military govt general policies for the permissible economic reconstruction of both zones as an integrated economic area, and the necessary ordinances in accordance with the principles adopted in the Potsdam protocol.

The present bizonal economic agencies will henceforth exercise their functions under executive directors in accordance with the policies of the Economic Council. In addition to the Economic Council an executive committee will be formed, composed of representatives from each of the several Laender which will have the day to day responsibility for coordinating and supervising the work of the several bizonal economic agencies in accordance with the policies of the Economic Council. [Page 924]All proposals of the Economic Council will be subject to the approval of the UK and US Military Governors and/or their deputies.

In accordance with the principles of decentralization in administration, maximum use will be made of land govts in implementing the policies and orders of the bizonal economic administrations.

Both UK and US Military Govts hope that the other occupying powers will accept their standing invitation to participate in this economic integration.

The agreement and the proclamation to place it in effect are now being translated into the German language and will be made public within the next several days.

Complete text of agreement will follow.31

Murphy

[On June 13, 1947, Secretary of War Patterson addressed a letter to the Secretary of State on the urgent problems of famine in Germany and the possible British program for the socialization of the coal mines in the Ruhr. For the text of the letter, see page 1151.]

  1. For the text of the agreement, see Documents on International Affairs, 1947–1948, pp. 617–621, and Ruhn von Oppen, Documents on Germany, pp. 227–231.