868.10/2–2150
The Secretary of State to the Chairman of the Export-Import Bank of Washington (Gaston)
My Dear Mr. Gaston: I am writing to convey to you, pursuant to our conversation of last Monday, my strong support of the Yugoslav request for urgent financial assistance.1
The National Security Council has concluded, with the approval of the President, that it is in the national interest of the US that economic aid essential to the maintenance of its internal stability and its independence in the face of Soviet pressure be accorded Yugoslavia. It is our belief that the Government of Yugoslavia will continue its resistance to Soviet domination. It is my judgment that Tito has burned his bridges leading to Moscow. The issue remains as to whether his resistance can be successful. In our view, it is of the utmost importance that he should be successful. This, in turn, depends in important part on the amount and promptness of our aid. As the President said on December 22, the US is just as opposed to aggression against Yugoslavia as against any other country and just as favorable to the retention of Yugoslav sovereignty.2 Our present information does not indicate, however, that the Soviet Union is preparing military action against Yugoslavia.
For the reasons which were brought out in the recent discussion of this problem by the NAC and which you, Secretary Snyder and I went over in our conversation on Monday, the great danger is that the furnishing of the necessary aid may fall between the agencies which have been working on this program. I believe that in this matter the Export-Import Bank can perform a notable national service and one consistent with its organic act. While many extraneous factors can obviously affect the development of the Yugoslav economy under present circumstances, the Department of State considers, and I believe the experts of the NAC staff concur, that there is a reasonable prospect that Yugoslavia, if it obtains the necessary credits this year, will prove to be able largely to pay its own way during 1951 and thereafter. I would hope therefore that the Board of the Bank might see its way [Page 1373] clear to extending the necessary credits to enable the Yugoslav Government to meet its immediate financial crisis, and to giving favorable consideration to requests for further credits during the current year if they should prove necessary.
I can assure you that I appreciate your cooperation and that of the Board of the Bank in giving urgent consideration to this problem which I consider of such concern to the national interest.
Sincerely yours,
- A memorandum of February 21 by Lucius D. Battle, Special Assistant to the Secretary of State, not printed, states that Secretary of State Acheson met with Secretary of the Treasury Snyder arid Export-Import Bank Chairman Herbert E. Gaston on Monday, February 20, regarding the proposed loan to Yugoslavia. Gaston had been reasonably receptive to the possibility of a loan and discussed the procedures for obtaining consideration by the Bank. Gaston requested a letter from the Secretary of State stating that assistance to Yugoslavia was national United States policy and indicating what the American plans for Yugoslavia were, particularly if the Soviet Union took action against Yugoslavia (Secretary’s Memoranda, Lot 53 D 444, Memoranda of Conversation—February 1950).↩
- Regarding the Presidential statement of December 22, 1949, under reference here, see footnote 2, p. 1354.↩