Foreign Relations of the United States, 1949, Eastern Europe; The Soviet Union, Volume V

ECA Telegram Files, Lot W–131, Paris Torep: Telegram

The Administrator of the Economic Cooperation Administration (Hoffman) to the Embassy in France

secret
priority

Washington, July 22, 1949—3 p. m.

Torep 6580. Personal to Harriman from ECA and State. Action pending on recommendation to place ferrous scrap on 1B list. At time Repto 4322, May 20,¹ we concurred your views. Today situation so changed in many fundamental aspects, we believe 1B action wise.

a. US, Canad no longer buying Ger scrap. West Eur requirements this scrap remainder 1949 substantially less than availabilities May mtg ad hoc scrap committee. East Eur still offering premium prices.

b. Allocations have been discontinued, and uniform price for Ger scrap exports suspended (Torep 5415, Jul 14²).

c. Direct occupation control Ger exports will be relinquished near future, and, Gers will administer own fon trade, including screening security items although it is expected that Allied High Commission will review licenses for 1A, 1B exports; and also retains power to intervene, if necessary. If scrap on 1B, occupation intervention wld be more feasible; statistics wld be available for checking; US approach to all countries wld be facilitated if eastward shipments from Ger and other countries became excessive.

d. Possibility lists becoming public poses public relations problem if scrap not included because of aura scrap retains from Jap experience.

Interdepartmental mtg this issue July 25.³ Pls comment soonest. [ECA and State.]

Hoffman

1. Ante, p. 115.
2. Not printed.
3. Paris Repto circular telegram 286, August 10, not printed, stated that the Advisory Committee on Requirements of the Department of Commerce had officially placed ferrous scrap on the 1–B list (London Embassy Files, 500 Marshall Plan).