ECA Telegram Files, FRC Acc. No. 53A278, Paris Ecato: Telegram
The Administrator for Economic Cooperation (Hoffman) to the ECA Mission in France
Ecato 606. Ref. Toeca 794, 796, 797, 798 and 810.1
- On the basis of information so far received, and after consultation with NAC Staff Committee, we concur in release of 25 billion to cover reconstruction and investment expenditures for month of April only. We wish to defer consideration of May and later releases until full review. We feel urgent need for submission full program counterpart expenditure for fiscal year 1949 in connection with review of present and prospective monetary and financial situation.
- Apparent from information so far received from you French financial stability by no means assured and questionable whether, in spite of success of loan, French measures have been as effective as we hoped. Emphasize need for watchfulness against apparent tendency of French to give in to pressure against credit controls. Share your skepticism chances budgetary balance 1949 unless further measures taken.
- Please have Information Officer call Huse2 to
clear timing following press release.
Begin text substance. “The Administrator has agreed to the release of a further installment of 25 billion francs for the financing of French investment and reconstruction programs for the month of April. Investment and reconstruction expenditures of the first three months of 1949 have been financed from resources available to the French Government, such as the proceeds of the internal loan. Breakdown of the projects to be financed from the 25 billion just released will be published shortly. At the present time it is possible to indicate that these projects are of the same nature as the projects financed from counterpart funds in 1948, which included investments of counterpart funds in the field of electric power, railroads, merchant marine, agriculture, colonial developments and coal mines. In addition to investment projects in basic industries, the new release covers expenses for war-damage reconstruction, and loans to private industry.” End text. Please pass OSR.