752.5 MSP/4–254: Telegram
No. 913
The Ambassador in Spain (Dunn) to the Department of State
priority
712. Embtel 691 March 26.1 Re Arburua visit.2 Following is summary of note verbale received from Foreign Ministry requesting reconsideration of sum indicated to be requested from Congress for economic and military aid to Spain fiscal year 1955.
Begin summary. Referring to oral information by Embassy to Foreign Office regarding prospective economic aid figure of $30 million and military aid figure of $74 million, total $104 million, the Ministry states that, following agreement among Spanish Government, [Page 1971] it desires to set forth reasons, its judgment, which require an increase in aid figures indicated. Agreements signed between Spain and US September 26, 1953 have as objective incorporation Spain into defensive organization of West on terms full effectiveness. For this purpose is indispensable establish national economic potential on level corresponding to defense objectives, especially when sound political and psychological base exists.
Embassy aware extremely difficult economic conditions existing Spain during last 8 years and only extraordinary effort of will of Spanish people has permitted maintenance of country in psychological and political situation lending itself to defense of West. Not only general circumstances following post war have served to limit economic development Spain, but also more rapid recuperation of neighboring countries as result of generous financial aid of US, which has contributed to imbalance between economy of Spain and progress experienced by neighboring countries. Unnecessary to dilate on details real necessities Spanish economy but limiting such only to those which constitute specific base for military defensive capacity, e.g. munitions production, electrical energy, cement, iron, steel, means of communications etc. Government of US well informed regarding details and would appear certain no doubt may exist with regard to disparity between suggested aid figure of $74 million and aid which Spanish economy requires in order to reach minimum level of recuperation during next year. Spanish Government also believes it desirable have in mind for political and strategic reasons necessity for accelerating in all ways possible Spanish military preparation.
There are other circumstantial conditions which must also be kept in mind relative to 1954–1955 as affecting Spanish economic position. These are the unforeseeable reduction Spanish foreign trade during current year as result adverse weather conditions and consequent necessity mass imports of cereals and on other hand large reduction foreign exchange earnings owing reduction export citrus fruits following freeze, of which US Embassy is well aware. Drain on economy as result of foregoing causes amount to more than $100 million for cereal purchases and $60 million loss citrus exports, expressed in dollars. This considerable loss reduces greatly possibilities for recuperation our economy during next year and as result military defensive capacity of country.
Ministry states its perfect comprehension American point of view as made public with regard to development of foreign trade instead of aid as means of re-established economies and military potential but points out that where in this criterion is eminently justified when applied countries which have enjoyed generous US aid, it is not applicable to Spain which needs recoup lost time in benefit of strategic and ideological principles which constitute base of agreement between Spain and US.
Ministry of Foreign Affairs requests Embassy to convey to administration urgent necessity for considerable increase in aid sums which have been indicated in principle as the amount of financial aid for next year and expresses appreciation for any steps that may be taken towards that end. End summary.
- Telegram 691 reported that Dunn had informed the Spanish Government of the information contained in Document 911. (752.5 MSP/3–2654)↩
- Minister of Commerce Arburua, Under Secretary of Foreign Economy Arguelles, and Under Secretary of Industry Suarez were invited by Stassen on Mar. 20, to visit Washington on Apr. 5 for 3 days of informal consultations and an additional period of travel to points of interest in the United States. (DMS files, lot W–1444, “Spain”) The decision to extend the invitation, as expressed in telegram 574 to Madrid, Jan. 22, was part of a general policy to “coordinate foreign official visits for this year, keeping them within reasonable limits with appropriate distribution among friendly nations.” (611.52/1–2254)↩