Memorandum of Conversation, by the Director of the Office of Financial and Development Policy (Ness)

Mr. Gouras,1 the Greek Chargé, called by arrangement this afternoon to inquire concerning his proposal that Export-Import Bank free, perhaps by the device of taking up outstanding letters of credit, the uncommitted balance of the $25 million credit. This balance is reported to amount to something under $13 million.

I informed Mr. Gouras that the decision communicated to him by the Bank in its letter dated January 17,2 a copy of which is attached [Page 12] hereto, was based on administrative considerations. I explained that by this [was] meant the consistency of his proposal with the original terms of the credit incorporated in the Board’s resolution. I informed him further that at my request the Bank had agreed to place his proposal upon its agenda for consideration on policy grounds at a forthcoming meeting of the Board of Directors. I told him that the considerations which had been influential in determining the Bank’s decision on administrative grounds would likewise be of considerable if not determining weight when the matter was taken up on its policy merits. In short, I gave Mr. Gouras no reason to anticipate a favorable decision in the matter. I did inform him that we would undertake to lay before the Bank such information as we have bearing upon the present Greek financial situation.3

(I had yesterday learned that the Acting Secretary of the Bank, in reporting a special meeting held this last Friday, incorporated as part of the minutes a record of the Bank’s action on administrative grounds.-Upon inquiry this morning I learned that this had been done with the thought of protecting the right of the Department to appeal the decision. Being concerned that inclusion in the minutes would unduly dignify the Bank’s action, I asked that the relevant portions of the minutes be expunged. This was agreed to without question.)

N[orman] N[ess]
  1. Paul Economou-Gouras, whose surname is commonly but erroneously referred to as Gouras.
  2. Not printed; the letter conveyed the regrets of William McC. Martin, Jr., Chairman of the Board of Directors of the Export-Import Bank, that the Bank was unable to accede to the Greek request.
  3. Mr. Economou-Gouras had called on Under Secretary of State for Economic Affairs Clayton on January 14, pursuant to instruction by the Greek Prime Minister, to discuss the possibilities for extraordinary and immediate financial assistance to Greece. Mr. Clayton had given assurances that “we were genuinely concerned over conditions in Greece and were exploring all possibilities of offering assistance. Because of legal limitations, however, he [Clayton] felt that there was no immediate prospect of direct financial aid to Greece at this time”. Mr. Clayton also had advised the Greek Chargé of the intention of the United States Government to present to Congress in the very near future a bill providing aid to several nations, including Greece, in urgent need of food and essential consumer goods. He had not felt, however, that such legislation would be enacted before the middle or end of March (memorandum of conversation, by William O. Baxter of the Division of Near Eastern Affairs, 868.51/1–1447).