396.1–ISG/3–1851: Telegram
The United States Delegation at the Intergovernmental Study Group on Germany to the Secretary of State 1
Sigto 559. Steering committee discussed on Thur,2 report of claims committee on principles resettlement pre-war debts IGG/P(51)60.3 Report reflected Fr acceptance of US position re scaling down of all claims and minimization of mark settlement, as well as certain UK concessions in same direction.
In steering committee UK del stated debts wld as practical matter, have to be scaled down but opposed any public statements by govts to this effect. Reserving their position as to how and when action shld be [Page 1388] taken, they were willing to envisage private statements to creditors during course of negots. UK also stated willingness to accept US-Fr proposals re limitations on mark settlement and termination at end stage 2 of present voluntary settlement procedures, on condition that existing requirement of 60 days notice to creditors wld be amended or dropped. UK explained their desire satisfy standstill creditors whose debtors have become fully solvent through currency reform US, Fr declared above Brit conditions and reservations not acceptable; consequently issues left unsolved. (Note: We are confident that with proper handling Brit will make further concessions, consequently did not attempt immed solution.)
There was inconclusive discussion on question what payments in foreign exchange Ger shld be permitted to make while receiving external aid. Claims committee will attempt drafting clause which wld take account of all relevant considerations. USDel stressed approach must be flexible and reserved position on fol:
- (1)
- Decision on size of permissible payments cannot be made before govts know roughly size of burden resulting from plan;
- (2)
- NY principle re effects on burden occupying powers must not be affected. Question how and when statements will be made re permissible payments in initial period was not resolved.
Claims committee will revise its report in several minor points, but not attempt rewriting language re scaling down and mark settlement. Report will be reconsidered after recess.
In view US-Fr opposition to liberalizing voluntary settlement procedure, no action will be taken for time being on HICOM paper FIN/P(51)8,4 which was referred to ISG. Issue remains pending in ISG and no action shld be taken in HICOM. UK realized that its liberalization proposal is thus put on ice.