340/6–1953

Memorandum by the Assistant Secretary of State for Economic Affairs (Waugh) and the Assistant Secretary of State for United Nations Affairs (Hickerson) to the Secretary of State 1

confidential
  • Subject:
  • World Fund for Economic Development

Discussion:

Notwithstanding strong U.S. opposition, the UN General Assembly in February 1952 called for a plan for establishing a Special UN Fund for Economic Development (SUNFED) to provide grant aid. This plan has now been prepared by a group of experts2 and it will be a major agenda item at ECOSOC in July and at the General Assembly in the fall. The President’s statement in his April 16 address in support of a “fund for world aid and reconstruction”3 has given encouragement to the supporters of SUNFED, and the President’s statement will inevitably enter importantly into the discussions. The refusal of the U.S. and of other “developed” countries to [Page 274] support SUNFED now may cause resentment among the majority of ECOSOC which strongly favors it.

The ECOSOC discussion concerning SUNFED offers an opportunity for us to carry forward the momentum of the President’s address and re-emphasize the President’s proposal for a fund for world aid and reconstruction. Attention would thereby be focused again upon the fact that it is the USSR which is holding up international efforts to promote economic development. A large body of world opinion would be further encouraged to support multilateral disarmament. We should therefore take the initiative to propose a resolution based on the President’s pledge. Clearly such a proposal would have stronger effect in ECOSOC if the fund were to be related to the UN. We should make clear that the President did not propose the establishment at this time of a world fund. The precedent conditions are specific acts by the USSR to strengthen world trust and make possible effective multilateral disarmament undertakings.

Proposed Position of U.S. Representative:

In the light of this situation it is proposed that the U.S. Representative: (1) point out that inasmuch as conditions for establishing an international development fund have not yet materialized, it is neither useful nor practical to consider the SUNFED proposal at this time; (2) state affirmatively that the fund envisaged by the President is an international fund and would be designed to strengthen the UN in its mission of guarding the peace and security of all peoples; (3) reiterate the President’s pledge and propose in ECOSOC that the UN General Assembly be asked to adopt a declaration urging all governments to join in the pledge, and proposing the convening of a conference of governments, when genuine progress has been made toward worldwide disarmament, to consider appropriate measures for using a portion of the savings from disarmament for development and reconstruction.

Recommendation:

1.
That you approve the proposed U.S. position set forth in the preceding paragraph;
2.
That after your approval of the position indicated, UNA and E will obtain the views of the other interested agencies; and
3.
That after this interdepartmental consultation a memorandum summarizing the proposed position on this issue will be prepared for transmittal by you to the President for his approval.4
  1. Drafted by Emerson A. Ross, Chief of the Investment and Economic Development Staff, and Edmund H. Kellogg, Officer in Charge of United Nations Economic Affairs.
  2. Wayne Chatfield Taylor was the American member appointed by the U.N. Secretary-General to serve on the nine-man U.N. International Development Fund Committee, which was empowered to draw up a blueprint for such a fund. Memoranda of conversation between Taylor and Department of State officials on the progress of the Committee’s work are in Department of State files 340, 398.14, and 800.10. The Committee’s report,Report on a Special United Nations Fund for Economic Development was completed in March 1953 and placed before the Economic and Social Council at its Sixteenth Session, held in Geneva June 30–Aug. 5, 1953.
  3. The President’s address, delivered before the American Society of Newspaper Editors, was broadcast to the nation over radio and television on Apr. 16, 1953. For text, see Department of State Bulletin, Apr. 27, 1953, pp. 599–603.
  4. The following note by O’Connor appears on the source text: “Sec saw and dictated memo.” Dulles, in his memorandum of June 27, 1953, expressed skepticism that the U.N. delegates would create SUNFED, noting that such an action would give rise to false hopes. (340/6–1953) Telegram Socec 8 to the U.S. Delegation, July 6, 1953, signed by Dulles, transmitted as the official U.S. position on SUNFED the three-point proposal outlined in this memorandum. (340/7–153)