305. Telegram From the Embassy in Iran to the Department of State0
908. Plan Org Min Hedayat today briefed EMB/USOM re recent Washington financial discussions.1 Said repeatedly he very pleased at warmth of reception and cooperative attitude US officials involved. Felt discussions outstanding example closeness Irano-American relations and willingness US help Iranian people realize their economic objectives. Said discussions had also strengthened his belief that new administration will maintain most friendly relations with Iran.
Stated DLF and Ex-Im loans will be most helpful in carrying out second seven year plan. While problems involved in utilizing proceeds these loans and DS grants which are tied to import US goods are complicated, [Page 713] he confident that rial generation will be sufficiently rapid meet cash requirements Plan Org and Min War without undue conflict with stabilization program. Noting that substantial financing gap still remains in second plan, he expressed confidence further US assistance will be forthcoming in 1961.
Said he had thoroughly briefed Shah and Cabinet re Washington discussions, emphasizing cooperative attitude USG, significance US loan assistance, and importance carrying out stabilization program. Also had made same points in interview which given wide and favorable coverage Iranian press. Said Shah and Cabinet shared his feeling warm appreciation.
Comment:Hedayat’s enthusiasm over his reception in Washington, his genuine pleasure at cooperation provided by Washington agencies for solution outstanding economic and financial problems, and his seeming conviction derived from Washington trip that desire help Iran will carry over into new US administration, all should be helpful in counter-acting prevailing concern in high circles GOI arising from widespread speculation here that new administration not sympathetic to this regime and likely reduce aid to Iran.
- Source: Department of State, Central Files, 888.00/12–2960. Confidential.↩
- Deputy Prime Minister Khosro Hedayat accompanied by Ahmad Majidian, Governor of the Bank of Melli; Reza Moqadam, Deputy Governor of the Central Bank of Iran; and Cyrus Samii of the Plan Organization met with Assistant Secretary of State Edwin Martin; Vance Brand, Managing Director of the Development Loan Fund; and officials of the Exim Bank and ICA to discuss U.S. loan and grant assistance to Iran. The talks were to reinforce the economic stabilization program designed to prevent Iran’s external bankruptcy and check inflation. As a result of the talks, the DLF loaned Iran $26.2 million, the Exim Bank authorized a loan of $15 million, and the ICA authorized Iran a $22 million defense support grant for FY 1961. In addition, the IMF acted to make available to Iran $50 million for its current fiscal year (March 1960–March 1961). (Memorandum from Miner to Kerr, December 19 and telegrams 870 and 876 to Tehran, December 21 and 22; ibid., 811.0088/12–1960, 888.10/12–2160, and 033.8811/12–2260, respectively)↩