Foreign Relations of the United States, 1969–1976, Volume E–4, Documents on Iran and Iraq, 1969–1972

134. Telegram 119690 From the Department of State to the Embassy in Iran¹ ²

Washington, July 1, 1971, 2015Z

1. The Board of Directors of Eximbank has authorized a $70.0 million credit to GOI to assist in financing its FY′72 payments for U.S. defense goods and services estimated to total $173.5 million.

2. Terms call for: (a) the GOI to make a cash payment of $15.5 million payable in the last quarter of FY′72, and (b) an extension availability date previously authorized defense credit (Credit No. 2956) to 12/31/71 to finance $18.0 million of total cost. The balance of $70.0 million will be extended by a group of U.S. commercial banks led by Manufacturers Hanover Trust Co. and will be guaranteed by Eximbank. Repayment $140.0 million Eximbank and commercial bank credits to be made semiannually over a period of 7 years beginning 11/15/72 with commercial banks repaid from first 7 semiannual installments and Eximbank from last 7 semiannuals. Eximbank credit carries an interest rate of 6% and a ½ commitment fee on unused balances.

3. Request Embassy advise GOI of this action, which will be detailed in letter to Ambassador Samii with copy to Embassy. END.

Rogers

1. Source: National Archives, RG 59, Central Files 1970–73, DEF 12–5 IRAN. Confidential. Drafted by John Lentz; cleared by Glenn McLaughlin, Don Bostwick (XMB), and Robert L. Dowell, Jr. (NEA/IRN); and approved by Paul H. Boeker (E/IFD/ODF).
2. The Department of State notified the Embassy of the credit terms authorized by the Export-Import Bank for Iran’s FY 1972 military purchases.