398.051 IFC/11–254: Telegram
The United States Representative at the United Nations (Lodge) to the Department of State
Delga 77. Re: US position on IFC. This telegram has reference to International Finance Corporation and particularly to US position which is in opposition to its establishment at this time. USDel discussed matter this morning and as result urges that US position be changed so as to enable USDel to sponsor with others resolution to authorize IFC along lines suggested by IBRD with other conditions acceptable to US to be worked out in concert with participating governments.
Senators Smith and Fulbright and delegates Jackson, Straus, Nash, Mahoney, Lord, Johnson and Wadsworth and also Hotchkis support this position.1
In urging this change, delegation points out that under present world conditions: 1) IFC is sound in principle; 2) IFC can be successfully operated with proper safeguards; 3) IFC would be administered by IBRD, as successful institution; 4) IFC would serve to encourage free enterprise and participation by private capital in under-developed countries; 5) IFC would help to convince under-developed countries that in a UN organization US has their welfare at heart in proposing means of access to secondary and equity financing on approved businesslike projects.
It is also suggested that possibility of securing US participation in IFC by consent of Export-Import Bank to make investment in IFC, or as alternative to secure consent of FOA to make an investment in IFC, be explored.
It is particularly urgent that our position be changed as now requested because: 1) US position on whole GA agenda is predominantly negative or neutral, and maintenance of our prestige and leadership is thereby made more difficult: 2) US position on technical assistance is neutral until further Congressional action; 3) there is growing possibility that SUNFED, under leadership of Netherlands and backed by almost all under-developed countries, might well be authorized at this session.2
- H. Alexander Smith, J. William Fulbright, C.D. Jackson, Roger W. Straus, James Philip Nash, Charles W. Mahoney, Mary P. Lord, Ade M. Johnson, James J. Wadsworth, and Preston Hotchkis.↩
- Preston Hotchkis, U.S. Representative in the Economic and Social Council, followed up this telegram with a letter addressed to Hauge, dated Oct. 28, 1954, which enumerated in greater detail the reasons for the U.S. Delegation’s belief that the United States should support the IFC in principle. (E files, lot 60 D 68, “International Finance Corporation, 1950–1956”)↩