811.516 Export-Import Bank/6–2047: Telegram

The Ambassador in Czechoslovakia ( Steinhardt ) to the Secretary of State


749. For Department and Exim Bank. In connection with pending negotiations between Exim Bank and Czechoslovak Government for additional 20 million dollars cotton credit, I suggest before additional credit granted Bank may wish to request detailed information from Czechs re disposition of textiles produced from cotton purchased under first credit of 20 million dollars. As thus far no noticeable increase in quantity cotton textiles available in Czechoslovakia notwithstanding importation of 20 million dollars of cotton from US in addition to substantial quantity delivered by UNRRA, Bank is clearly entitled before extending additional credit to detailed statement from Czechs setting forth (a) division of cotton purchased in US as between nationalized and privately owned textile mills, (b) quantities made available in form of finished products to Czechoslovak public, (c) quantities retained by nationalized industry or Czechoslovak Government in form of finished products, (d) quantities exported either as cotton or as cotton textiles to foreign countries specifying countries by name and quantity, (e) terms payment in respect of all sales to foreign countries.

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In my opinion it would not be prudent for Exim Bank to increase its cotton credit to Czechoslovakia from 20 million to 40 million dollars unless and until foregoing detailed information received and analyzed by Bank as well as checked with this Embassy for accuracy as to information furnished to extent that Embassy can make such a check from confidential sources available to it in Praha.