Office of the Historian

268. Report Prepared by the Operations Coordinating Board1

Washington, November 23, 1955.

PROGRESS REPORT ON U.S. POLICY TOWARD YUGOSLAVIA (NSC 5406/1)2

(Policy Approved by the President February 6, 1954)

(Period Covered: April 13, 1955 through November 23, 1955)

A. Summary of Major Actions and Decisions

1. Policy Review. Pursuant to the recommendations of OCB in the latest prior progress report, April 13, 1955, the basic policy has been [Page 705] under review during the past four months. A National Intelligence Estimate was prepared for the NSC and a JCS reevaluation of the military significance has been prepared.3

2. Military Assistance. The total accumulative amount of U.S. military assistance to Yugoslavia programmed for end items through September 30, 1955 reached $812.7 million. The dollar value of end items delivered by August 31, 1955 was $587.2 million. Shipments during calendar year 1955 (through August 31) totaled $76.7 million.

3. The Department of Defense after coordination with the Department of State issued instructions on June 13, 1955 to accord lowest priority to Yugoslavia for the receipt of MDAP equipment except for (1) material essential for the maintenance of MDAP equipment previously furnished or required for training, and (2) the MDAP equipment in the supply pipelines.

4. Economic Assistance. At the end of the period under review the cumulative total of U.S. economic assistance amounted to $525.1 million, of which $484.0 million had been shipped by June 30, 1955. The bulk of this assistance was in the form of surplus agricultural commodities, i.e., wheat and cotton.

5. Discussions with the Yugoslav Government regarding continued economic assistance under FY 1956 MSP and PL 480 were not undertaken until basic U.S. policy review indicated the desirability of continued economic aid.

6. Mission of Deputy Under Secretary Murphy. The Deputy Under Secretary of State conducted negotiations with the Yugoslav Government in Belgrade during the week ending October 1 and reached an understanding on the following major matters:

a.
No change in policy of either nation toward the other.
b.
Facilitate operation of American Military Assistance Staff.
c.
Strengthen mutual economic cooperation—U.S. to furnish immediately 300,000 tons of wheat and to negotiate on further economic aid this year. (These discussions have begun.)
d.
U.S. willingness to discuss program for peaceful uses of atomic energy.
e.
Department of State to support Yugoslav application for Export-Import Bank loan.

[Subparagraph f (1 line of source text) not declassified]

7. Information Programs.USIA continued its efforts to disseminate the U.S. foreign policy viewpoint in Yugoslavia through its press Bulletins, VOA broadcasting, exhibits, backgrounders, book presentations, and related activities. In September and October 1955, the U.S. [Page 706] atoms-for-peace exhibit was shown to large audiences, including key government officials.

[Sections B and C (3–1/2 pages of source text) not declassified]

  1. Source: Department of State, OCB Files: Lot 62 D 430, Yugoslavia 1956–1957. Top Secret. A Financial Annex listing approximate U.S. aid expenditures for Yugoslavia for fiscal years 1953–1956 is not printed.↩
  2. For text, see Foreign Relations, 1952–1954, vol. VIII, pp. 1373–1377.↩
  3. Documents 254 and 266.↩