97. Memorandum From the Assistant Secretary of State for Near Eastern, South Asian, and African Affairs (Rountree) to the Secretary of State1
SUBJECT
- Additional Economic Assistance to Jordan
Discussion
The Embassy at Amman has reported (Tab B2) that Jordan may face a critical and dangerous fiscal situation by August 1, 1957. The primary reason is the failure of Syria and Egypt to make good on their promises to contribute $21 million annually to Jordan. Considering the highly strained relations between Jordan and Syria and Egypt, it is extremely doubtful that aid from this source will be forthcoming, nor is it to our interest that Syria and Egypt use this means to reassert their influence in Jordan.
Our efforts to persuade the British and the Iraqis to assist Jordan have so far been unavailing. We intend to pursue these efforts vigorously, but there is no assurance that funds from these sources can be obtained within the next two months. Saudi Arabia has contributed $7 million to Jordan and has undertaken to contribute a further $7 million on October 1, 1957. We doubt that we [Page 147] would be successful in an effort to persuade Saudi Arabia to expedite its second payment.
Our greatest concern is that Jordan will face a crisis in August at a time when our ability to assist Jordan may be highly limited, in view of the very strong possibility that Congressional action on Fiscal Year 1958 Mutual Security funds will not be completed in time. Accordingly, we feel that some of the remaining Fiscal Year 1957 funds should be committed to Jordan as quickly as possible. Since April 27 we have given the Jordanians $10 million in special economic assistance and expect to be in a position to extend another $10 million in the form of military assistance before July 31. On the basis of information available to us in late May, we had decided to extend another $5 million in economic aid, hoping that we could convince the Iraqis to match this contribution. Mr. Hollister had agreed to this amount. However, the Iraqis would not make a matching contribution. It is our considered opinion, in view of all available evidence, that we should increase this proposed additional grant to $10 million.
We understand that Mr. Hollister is reluctant to allocate more than $5 million of Fiscal Year 1957 funds to Jordan for this purpose. We believe that our interests in the independence and integrity of Jordan are so great that it would be unwise to take the risk of inadequate provision for Jordan’s needs. We believe that the sum of $10 million will be required to overcome this risk.
Recommendation
That you sign the attached memorandum to Mr. Hollister (Tab A3) requesting that $10 million of Fiscal Year 1957 Mutual Security funds be made available to Jordan for budgetary support.4
- Source: Department of State, Central Files, 785.5–MSP/6–1957. Confidential. Drafted by Bergus on June 18 and transmitted through S/S.↩
- Telegram 1815 from Amman, June 17; not found attached. (Ibid., 785.5–MSP/ 6–1757)↩
- Not found attached. A copy of the memorandum to Hollister as signed by the Secretary on June 20 is attached to a memorandum from Rountree to the Acting Secretary, June 28. (Ibid., 785.5–MSP/6–2857)↩
A note from Wilkins to Rountree, attached to a copy of this memorandum, ibid., NEA Files: Lot 59 D 582, Memos to the Secretary thru S/S 1957, reads:
“The original of the attached memo is in Mr. Herter’s office awaiting his consideration.
“We understand that Mr. Hollister is now agreeable to $7.5 rather than $10 million on grounds that his figures show the smaller amount will carry Jordan through Sept. We doubt this amount will suffice and even if it does it will cut things too fine and take too great risk.
“Time is so short we hope you can persuade the Secretary to sign the letter in Mr. Herter’s office and to ask Mr. Hollister for the $10 million today.” A handwritten notation on the source text from Rountree to Wilkins reads: “Approved by Mr. Herter & now with Secy. I have asked SS to try to expedite.”
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