860F.51/11–1347: Telegram

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


1518. In conversation with Ripka he stated that if a 20 million dollar cotton credit could be obtained from US in near future he was in position to assure me that Czechoslovak Govt would promptly settle large American claims for nationalized property. As our Govt has had under consideration a 20 million dollar cotton credit to Czechoslovakia, and as I am convinced that Czechoslovak foreign exchange position with particular reference to dollars has deteriorated to point at which there is little hope for settlement of our claims for nationalized properties in near future, and as I would not be adverse to extension of a cotton credit provided there is a really worthwhile quid pro quo, Dept may wish to instruct me to explore possibilities growing out of Ripka’s suggestion.1

In connection with foregoing it would seem highly undesirable that any encouragement be given Czechoslovaks that cotton credit may be extended unless and until a very definite agreement has first been reached in Praha re payment our claims for nationalized properties as a condition precedent to extension of any such credit. Ripka told me in strict confidence that Soviet authorities had already informed him that maximum amount of cotton they will be able to deliver pursuant to their promise of 20,000 tons is 14,000.

  1. Telegram 1310, November 28, to Praha, not printed, stated that the matter would be discussed with the Ambassador upon his planned return to the United States (860F.51/11–1347). Ambassador Steinhardt departed from Praha on November 24, 1947.