Office of the Historian

369. Telegram From the Department of State to the Embassy in Lebanon1

Washington, December 24, 1958—10:32 a.m.

2245. Embtel 2535.2 Evident lack GOL interest together with Karami recent parliamentary assurance suggest US need not continue earmarking any specific amount DLF funds for use by GOL. World wide requirements greatly in excess current Fund availabilities, thus Fund as matter great urgency must free up money for which no immediate needs exist. All funds will be exhausted January 31 and unless part of GOL earmark released several urgent projects will go by board. Expect situation may ease when new appropriations obtained early next year.

Unless Embassy objects suggest that $4 million of present earmarked funds be held for possible financing the two current applications totaling $2.137 million from private Lebanese business users now on hand being studied or for applications which might be sent in soon and the remaining $8 million released for use elsewhere. Future applications beyond the $4 million would be processed on “funds available” basis in accordance with general practice in handling applications received from other countries.

If you agree with foregoing suggest Karami be informed.3

Herter
  1. Source: Department of State, Central Files, 783A.5–MSP/12–258. Confidential. Drafted by J.F. Shaw in NEA/NE/E and cleared in NE by Hamilton and Meyer and in DLF by H. Perry.↩
  2. Document 367.↩
  3. The Embassy responded, in telegram 2805 from Beirut, December 31, that it had not meant to convey the impression that the Lebanese Government was not interested in DLF support. On the contrary, the Embassy stated that there was a “bona fide requirement” in Lebanon for DLF financing which could absorb even more than the $12 million which had been allocated for Lebanon. (Department of State, Central Files, 783A.5–MSP/12–3158) On January 7, however, the Department indicated, in telegram 2346 to Beirut, that the DLF staff planned to recommend to the Board of Directors a reduction of $8 million in the DLF funds which had been allocated for Lebanon. (Ibid.) Both telegrams are included in the microfiche supplement.↩