Telegram from Ambassador Henry Grady to Secretary of State Dean Acheson, Number 531

INCOMING TELEGRAM Department of State copy 10f2 TELEGRAPH BRANCH 11 for SECIDE 894 Action Control: 4005 NEA Rec'd: August 8, 1951 FROM: Tehran 9:53 a. n inio SS TO: Secretary of State 3. TRUNAM G 531, August 8, 2 p.m. : ARCHIVES "NATIONAL SERVICE" RECORDS AND DECLASSIFIED EUR NO: E. Q. 11652, Sec. 3(E) and 505 E Depr. of Seate fectez, 4-11-78 DCR NLT 74.2 PRIORITY By MLT. HC NARS 9-21-71 SENT DEPT 531; RPTD INFO LONDON 121 (EYES ONLY AMBASSADOR) o FROM HARRIMAN FOR PRESIDENT AND SECRETARY. NO DISTRIBUTION EXCEPT AS DIRECTED BY THE SECRETARY'S OFFICE. Following his arrival on Saturday, August 4, Stokes called on Mosadeq Sunday morning and had lunch with Shah. Mosadeq returned his call in the evening and dined with him. Stokes had his first meeting Monday afternoon with the group of Mixed 0il Commission and Minister's of Finance, Education and Communications. I talked with Mosadeq after his second meeting with Stokes and he was in exceptionally good spirits. He said that he was pleased with the choice of Stokes to head British mission and liked him personally. I believe all Iranians with whom he has talked are favorably impressed with him. In their first talk, Mosadeq agreed with Stokes suggestion that latter go to Abadan to get first hand information on situation there. Stokes was particularly anxious to make 612 trip because of effect upon morale of British employees there. He asked me to accompany him and a representative of Iran Govt on trip Tuesday. For obvious political reasons we went in our own respective planes, Iran Govt representative travelling with me. I returned Tuesday afternoon, and Stokes party stayed over-night. Iranians turned out substantial numbers of military personnel lining road from airport, with several truck loads accompany- ing party. Upon Makki's insistence Stokes and I were taken on tour of al classes of housing facilities at Abadan, with emphasis on slum area. Although slums are typical of middle East they are shocking for housing of employees of large West- ern oil company. Refineries are completely shut down but al employees are still kept on payroll with little to do except for new construction work. British have MOP REPRODUCTION OF THIS MESSAGE IS PROHIBITED