230. Telegram From the Department of State to the Embassy in Yugoslavia1
SUBJECT
- President Reagan’s Reply to Yugoslav Presidient Djuranovic’s Letter on Yugoslav Debt Rescheduling.2
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- (C—Entire text)
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- In response to President Djuranovic’s letter to President Reagan delivered by Deputy Foreign Minister Loncar, Embassy is instructed to deliver the following reply:
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- Quote
His Excellency
Veselin Djuranovic,
President of the Presidency
Socialist Federal Republic of Yugoslavia,
Belgrade.
Dear Mr. President:
Thank you for your letter of November 12 that Deputy Foreign Minister Loncar deivered in Washington. I share your conviction that personal contacts and the exchange of messages at the highest level [Page 678] are of exceptional importance and have contributed to the successful expansion of cooperation and the development of the excellent relations between the United States and Yugoslavia.
Vice President Bush and senior U.S. Government officials were pleased to receive Deputy Foreign Minister Loncar here in November. His visit provided a very useful opportunity to exchange views on the Yugoslav economic and financial situation and the modalities of refinancing.
Along with other friends of Yugoslavia, the United States has been pleased to have worked closely with your government in recent years in meeting your country’s financial and economic adjustment needs. Yugoslavia has confronted its economic difficulty with courage and seriousness of purpose. The Yugoslav people have made many sacrifices. I appreciate and support the efforts made by your government and people to overcome your current economic difficulties and applaud the positive results you have achieved, accomplishments which you justifiably underscored in your letter and which are well known to every friend of Yugoslavia.
Despite the progress that has been made, the United States recognizes that Yugoslavia requires continued assistance in assuring its external liquidity. As requested in your letter and presented by Mr. Loncar, we have given careful consideration to your proposal for a multiyear refinancing program. We can appreciate both the economic and political considerations you raised. Our experts have recently reviewed possible ways to meet Yugoslavia’s refinancing needs over the next few years at the Geneva meeting between the Western creditor governments and representatives of your government. I understand that the outline of an acceptable approach that has the support of all creditors began to emerge at that meeting. We believe that if all parties approach the issue with openness and flexibility, we will find a solution acceptable to all. An approach based on the successful efforts of the past two years—involving the Fund, commercial banks, and official government creditors—would seem to offer the most appropriate way to proceed. Let me emphasize again that the United States is prepared to work closely with you and with other creditors and the International Monetary Fund throughout this process. Mr. President, I deeply value the long-standing and deep-rooted friendship existing between our peoples and nations. Let me assure you that the United States will lend its full support to your efforts to overcome the economic and financial problems presently confronting Yugoslavia. Our common goal should be to devise a sensible, pragmatic and realistic approach which will enable Yugoslavia once again to satisfy its financial requirements through its own internal resources and normal external credit [Page 679] channels while at the same time ensuring its full independence and nonalignment.
Sincerely,
Ronald Reagan
Unquote
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- Note: there will be no signed original.
- Source: Reagan Library, Executive Secretariat, NSC Head of State File, Yugoslavia: President Djuranovic (8408586–8409290). Confidential; Immediate. Drafted by Ben Fairfax (EUR/EEY); cleared by Kuchel, Palmer, Lawrence Greenwood (EB/IFD/OMA), Constable, McKinley, Kimmit, Dobriansky, and Robinson and in Treasury; approved by Burt.↩
- See Document 228.↩