Office of the Historian

895.50 Recovery/6–2049: Telegram

The Ambassador in Korea (Muccio) to the Secretary of State

Seoul, June 20, 1949—7 p. m.
[Received June 20—11:23 a. m.]

749. This is joint State-ECA radio. ReDeptel 473, June 17 (not serviced until June 20).

Part 1. From [economic?] point view felt that:

(a)
Korea not sufficiently important transshipment point in area as to warrant application R–procedure.
(b)
Non-ECA experts from US negligible in relation ECA exports, former averaging less than 2 percent latter in recent months. Transshipment of such non-ECA exports also negligible. Amount believed insufficient warrant application R–procedure.
(c)
ECA exports to South Korea largely composed of “key goods of major importance [garble] Chinese economy”. No ECA goods for Korea programmed for transshipment and aid agreement41 prohibits any transshipment without ECA approval. R–procedure would require further administrative review in Washington. Local ECA mission fears such reviews would handicap program.

Part 2. From political point view felt that inclusion South Korea and exclusion Japan and Philippines would have diverse political repercussions here. Felt that development of concept implicit in reftel can be best fostered in Korea by unified Korean-American controls administered locally. Felt also that with cooperation Korean Govt objectives can be obtained through effective administration:

(a)
Paragraph 3 article V aid agreement which prohibits re-export ECA and similar commodities.
(b)
Paragraph 1 article IV aid agreement which permits ROK42 to develop import-export program in cooperation with ECA.
(c)
Export license system developed and administered in consultation with mission advisors.

Muccio
  1. Signed at Seoul, December 10, 1948, Department of State, Treaties and Other International Agreements Series No. 1908, or 62 Stat. (pt. 3) 3780.↩
  2. Republic of Korea.↩