Foreign Relations of the United States, 1951, National Security Affairs; Foreign Economic Policy, Volume I

455.006/9–1551: Telegram

The Ambassador in Belgium (Murphy) to the Secretary of State

confidential

Brussels, September 15, 1951—noon.

361. Pass OSR and ECA. See Repto 4541, rptd Brussels Repto 310, Sept 12 and Brussels Embtel 335, rptd Paris 76.¹ Present cable attempts further clarification regarding Belgian position restriction dollar imports.

Belgians point out they have been under constant pressure reduce surplus EPU. Since Belg approximate over-all payments balance, Belgs consider one of necessary and most immediately effective means reduce EPU surplus and at the same time maintain over-all payment balance is increase imports from EPU countries and reduce dollar imports. In turn, Belgs consider only way immediately accomplish this is discriminate against dollar imports and favor imports and other EPU countries.

Although Belgs recognize that neither managing board, other OEEC comites, nor US has specifically requested restriction dollar imports by Belg, Belgs feel they can pressure reduce EPU surplus in no other way than as pressure restrict dollar imports, given context situation outlined part two above.

It seems to us that US position at present gives appearance of requesting discrimination against dollar imports because of financial aims of US Govt while long-range trade aims of US Govt oppose such discrimination. Essential facts of situation not altered by Belg position of applying discrimination prior financial and balance of payments difficulties rather than awaiting such difficulties and subsequently applying discrimination.

ECA mission concurs.

Sent Dept 361, rptd info Paris 83.

Murphy

1. Repto 4541 was Part II of a “special series of messages” on the problem of the Belgian EPU surplus, initiated: by the Office of the Special Representative in Europe (OSR) with telegram Repto 4544, September 12, 9 p. m. It is not clear how many cables were transmitted relative thereto, but the “series” may have been completed with Repto 4541. In Repto 4544 it was stated that the Belgian crisis, though precipitated sooner than expected, “has generally been regarded as inevitable, in sense that Belgs expected be in continuous surplus position with end result exhaustion of quota.” In Repto 4541 the ECA Administrator was informed that in a special MB session (Managing Board of the European Payments Union), September 3–5, there were delineated “aspects” of the problem of the Belgian EPU surplus on which more information was needed. (ECA Message Files, FRC Accession 53A278, Repto Series)