781.5 MSP/5–753

No. 439
Memorandum of Conversation, by the Deputy Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Jernegan)



  • Greek Request for American Aid for Development Program


  • Mr. Spyros Markezinis, Greek Minister of Coordination1
  • The Secretary

Also Present:

  • Athanase G. Politis, Ambassador of Greece
  • NEA: John D. Jernegan

Mr. Markezinis spoke at some length about the sacrifices being made by Greece to support large armed forces, emphasizing the relatively high proportion of the Greek national income expended for defense. He pointed out that Greece had the lowest national income of any NATO member, yet was spending the highest percentage for military purposes. He said that Greece intended to continue to maintain its forces and would even increase them if necessary. He insisted on the importance of Greece in the defense of Southeastern Europe and expressed the hope that a strong Greece, in collaboration with Turkey and Yugoslavia, could induce some of the Balkan Satellites to break away from the Soviet bloc. He thought this was a field of diplomatic activity to which we should devote great attention.

The Minister went on to say that Greece was anxious to stand on her own feet and was now in a position to offer something instead of merely asking for things. So long as there have been weak coalition governments in Greece, this had not been possible but the advent of the Papagos Government with its overwhelming Parliamentary majority had changed the situation. The Minister had with him a letter from Marshal Papagos to President Eisenhower 2 which was of the greatest importance and which he would deliver later in the morning. He urged that, after its delivery, the Secretary [Page 823] read it carefully. It would show the lengths to which Greece was willing to go in support of the West.

However, Mr. Markezinis said, it was essential that there be compensation for the sacrifices which Marshal Papagos was asking the Greek people to make. Specifically they must have hope for better conditions to come in the future, and this must be held out through the implementation of an economic development plan. This plan, which we had worked out, called for the expenditure of about $230,000,000 over a four-year period. The equivalent of $130,000,000 would be supplied in drachmae by the Greek Government itself. The remaining $100,000,000 was needed in dollars from American sources. He thought this was a very small amount to request in view of the importance of the objective and the amount of money the United States was making available to other countries.

What Mr. Markezinis wanted at this time was not a commitment that we would give Greece a specific sum of money; he understood that we could not make promises until Congress had acted on our appropriation request. What he did ask, most emphatically, was a general statement to the effect that we endorsed the development program and would give it our full support. Later we could talk about specific items and the amount of money required from the United States Government, but a general statement of support now would provide the necessary psychological impact in Greece. He pointed out that such a statement would not in fact bind us to anything and he remarked jokingly that Greece would not sue the United States to enforce the promise of support.

Mr. Markezinis handed the Secretary a memorandum describing his proposed development program,3 saying he had given a copy to Mr. Stassen yesterday.4 The Secretary glanced at a portion of it and remarked that our present desire was to see projects of this type financed so far as possible by the International Bank. We ourselves, the Secretary said, were having financial troubles and had not yet succeeded in balancing our budget. We preferred, therefore, to have the privately financed International Bank provide money whenever possible rather than to draw on appropriated funds through the Mutual Security Agency or the Export Import Bank.

Mr. Markezinis replied that he was perfectly willing to consider financing by the Export Import Bank or the International Bank but he must first of all have the assurance of United States Government support. As he envisaged the matter, part of the funds for [Page 824] the program should come from the United States Government, as those funds would be quickly available and would enable an early start. The remainder, perhaps the greater part of the total, could come from the two Banks.

In closing, Mr. Markezinis made an impassioned plea for positive American assistance, stressing the gallant nature of the Greek people and in particular the importance of giving concrete evidence of support for the Papagos Government. He said that if he returned to Greece and was able to say only that the United States Government had been friendly but non-committal, it would have a serious effect on the stability of the Greek Cabinet and on the attitude of Marshal Papagos toward the United States. He was sure that if he (Markezinis) were rebuffed here, Marshal Papagos would declare his intention to maintain Greece’s alignment with the West and Greece’s armed forces at their present level at any cost, but at the same time would renounce all special connection with the United States, terminating the MSA Mission to Greece and all MSA aid, etc. He would certainly do this if Greece were offered nothing more than a mere $20,000,000 in economic aid for the coming year. Such an attitude by Papagos would have very bad effects for the United States not merely in Greece but throughout the Middle East, where Papagos had great prestige. The Minister added that the Secretary’s forthcoming visit to Greece would be very adversely affected.

The Secretary made no comment on these observations and merely promised to study the Minister’s memorandum.

  1. Markezinis visited Washington May 5–9 and 14–16 to discuss economic questions, particularly plans for the economic development of Greece.
  2. Dated Apr. 29, not printed. (Eisenhower Library, Eisenhower papers, Whitman file) In despatch 1193 from Athens, Apr. 18, Yost informed the Department of State of the contents of Papagos’ letter which Yost read in first draft at Markezinis’ request. (781.13/4–1853)
  3. Markezinis’ 10-page memorandum, Apr. 29, stated that the development program would cost $237 million over the next 3–5 years and that Greece needed $113 million of this cost. (881.00/5–2253)
  4. No record of the StassenMarkezinis meeting has been found in Department of State files.