Office of the Historian

407. Telegram From the Embassy in France to the Department of State1

Paris, July 23, 1960—10 a.m.

360. From Dillon. At meeting with Heathcoat-Amory, Chancellor of Exchequer, July 22,2Dillon presented case for increase in percentage contribution by UK to budgetary support for Jordan. In response, Chancellor outlined difficulties, stressing increased demands on UK [Page 734] for assistance to Commonwealth countries, particularly nearly independent nations, considerable increase in British private overseas investment, current difficult balance of payments situation, fact that Jordan imports chiefly from Germany, and domestic POL opposition to assisting country from which UK “thrown out”. Chancellor agreed, however, that present distribution (UK 15 percent, US 85 percent) “not fair”. Dillon adduced numerous reasons why increased contribution by UK important from viewpoint both countries, and suggested solution lay in agreement on respective percentages contributions. Dillon indicated 50/50 division of responsibility most desirable outcome but recognized POL difficulties for UK this solution and suggested UK consider assuming at least 40 percent contribution. Chancellor said they had thought of possibility that Germany might be willing to assume share of support, but did not pursue subject in detail. He indicated that British are currently engaged in assessment of the need for existing military bases and stressed that any increase in commitment on one hand, i.e., Jordan, would only be possible through reduction in some other existing commitment.

Chancellor concluded that they would look at question of increase in UK contribution to budgetary support and would study it in the light of their “reappraisal of priorities” of their over-all commitments. He stated that while they are unable to commit themselves at this time, they would be able to give a definite answer in September at time of Bank and Fund meetings. Dillon accepted this commitment, but re-emphasized importance of reaching definite decision before US has to prepare Mutual Security Program budget presentation October.

Houghton
  1. Source: Department of State, Central Files, 841.0085/7–2360. Confidential. Repeated to Amman and London.↩
  2. Dillon and Heathcoat-Amory were in Paris July 22—23 to participate in the ministerial conference on the reconstitution of the Organization for European Economic Cooperation.↩