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

A/MS Files, Lot 54 D 291¹

Memorandum by the Under Secretary of State ( Webb )²

confidential

[ Washington ,] June 28, 1951.

Subject: Administration of aid programs in underdeveloped areas.

For guidance in the preparation of Congressional testimony concerning the proposed Mutual Security Program and for use in planning the administration of such program, the following is a summary of the Department’s position with respect to the division of responsibility between TCA and ECA for the administration of economic and technical assistance in underdeveloped areas.

Only one United States agency should operate economic and technical assistance in any one country.

The division of responsibility between ECA and TCA will be based upon the nature of the proposed program in a particular country or region. If the program contains substantial amounts of economic grant aid for capital development, the entire program in a country or region including the technical cooperation segment will be administered by ECA. On the other hand, where the program consists primarily of technical cooperation in a country or region, it will be administered by TCA.

The final application of the above cannot be determined until the Congress has completed action on the proposed aid program. However, in order that testimony be complete and clear as possible, witnesses should be prepared to explain how the program as proposed would be administered in each country or area. The country responsibility would be as follows:

1. TCA would operate in Latin America and would continue to use the IIAA as an operating arm.

2. TCA would operate in the Arab States, Libya, and Israel, using the proposed new regional organization in the field. TCA would administer directly the technical cooperation program in Ethiopia and Liberia.

3. TCA would operate the technical cooperation programs in Afghanistan, Ceylon and Nepal.

4. ECA would administer economic and technical aid in Iran.

5. ECA would administer economic and technical aid in India and Pakistan.

6. ECA would operate the STEM type programs in Burma, Thailand, Indonesia, Inclo-China, the Philippines, and Formosa.

I have discussed the above with the Bureau of the Budget and with Mr. Foster.

James E. Webb

1. Drawer 49, Folder “TCA/Pt. IV Reports: Briefing Statements for Secretary, Undersecretary, and Director.”
2. Addressed to the Technical Cooperation Administrator (Bennett), the Director of International Security Affairs (Cabot), the Assistant Secretary of State for Congressional Relations (McFall), and the Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (McGhee).