Memorandum of Conversation with Secretary of State Dean Acheson, Ambassador of Belgium Baron Silvercruys, Paul Hubert, and Mr. Thompson

DEPARTMENT OF STATE S/S ARCHIVES "NATIONAL RECORDS SERVICE" AMD Memorandum of Conversation 664 : 2500 DATE: October 21, 1949 SUBJECT: Yugoslavia Balance of Payments PARTICIPANTS: The Belgian Ambassador, M. Silvercruys Mr. Paul Hubert, Attaché The Secretary of State COPIES TO: Mr. Thompson, EUR s, U, OFD, ED, RA, WE, EUR 1-1493 The Secretary said he had asked the Ambassador to come in in order to discuss the current Yugoslav situation. He emphasized the importance of the Yugoslav break with the Kremlin and said that at the present time Yugoslavia was faced with a difficult situation in its balance of payments. The situation was particularly difficult with respect to the rest of this year and for 1950. It appeared that the long term outlook beginning with 1951 looked good. We had arranged an Export-Impo: Bank loan of 20 million dollars and when these and other steps that were being taken had time to take effect, Yugoslavia would be able to increase its exports and would probably not be in an unfavorable situation. The British were negotiating a commercial agreement which we understand involves 13 million pounds credit, and the French are looking into the situation to see what they can do. The World Bank is considering a substantial loan. The immediate difficulty is that Yugoslavia owes Belgium some 4 1/2 million dollars, representing short term credits advanced to pay for earlier purchases and it is expected that there will be a trade deficit on current account of about another 1.5 million dollars. On September 10, 1950, the Yugoslavs will owe Belgium DECLASSIFIED E. O. 11652, Sec. 3(E) and 5(D) or (E) Dept. of State letter, Aut-33073 By NLT- HL ; NARS Date 4-28-76