768.5 MSP/3–1954
No. 690
The Department of
State to the British
Embassy
1
The Secretary of State presents his compliments to His Excellency the British Ambassador and has the honor to refer to the Aide-Mémoire to the British Embassy on March 5, 1954.2 It would be appreciated if the views of Her Majesty’s Government and the French Government as to their participation in tripartite economic aid to Yugoslavia in the period July 1954–June 1955 could be obtained before the submission to the United States Congress of the mutual [Page 1379] security request for that period. A parallel note on this subject is being sent to the French Government.
The United States Government has again reached the conclusion, in recently reviewing its policies toward Yugoslavia, that it is of great strategic importance to the security of the free world to maintain Yugoslavia as a strong and independent ally. The Yugoslav economy is not yet strong enough to support, without economic assistance, the maintenance of the military establishment required in the interest of Western defense.
In view of the need to submit a firm request to Congress for appropriations, the British Government will understand that the United States Government, in seeking its agreement to participate in a tripartite program of assistance, would also appreciate knowing the amount of the projected British contribution for the period July 1954–June 1955. It is the preliminary view of the United States Government that, taking into account the previous pattern of tripartite contributions, the minimum amount of a British and French contribution consistent with a realistic sharing of the burden would be $10 million, which would mean a British contribution of the sterling equivalent of $6 million, based on the conception valid in the past that the ratio of the British to French contribution would be three to two.
Present plans are to ask the United States Congress to appropriate funds which could be made available to Yugoslavia as the United States contribution to tripartite economic aid in the amount of $35 million. The amount is conditional upon legislative approval and appropriation.
The United States Government proposes that, if the British and French Governments agree to make this sum available, the procedural arrangements under which the tripartite program are to be administered should continue in the present form.
The British Government will understand that an early indication of its views will be appreciated to facilitate planning of the United States appropriation request.