253 Notes on Interdepartmental Meeting

, [CANBERRA], 24 May 1949

NOTES ON MEETING 24TH MAY 1949 Item 17.[1] International Economic Development Programme (1)[2] The Treasury representative stated that Australia's resources are such as to make Australia an importer rather than an exporter of capital and services so that any contribution made would be likely to be in cash to the International Economic Development programme although in some cases goods and services might be available.

The Treasury rep. wishes for words such as 'inasfar as resources permit' after the word 'afford'.

(2) The Treasury pointed out that bilateral schemes might in some cases be indulged in more readily by Congress than contributions to international schemes and that the cost of the former would be nil to Australia. As against this it was pointed out that this would do a great deal of harm to Australia's influence and trade position in say S.E.Asia if bilateral U.S. aid were given. It was however pointed out that Australia has some bilateral Fellowships arrangements and that reporting these to the co-ordinating body is in some cases an adequate safeguard.

(3) There was some criticism of the practicability of relating Australian contributions to work done in particular areas and some fear that larger contributions might be expected if work was in fact done in the area in which we were interested. It was also felt that we could not very well ask for work to be done in the area.

It was felt desirable to insert a provision that contributions to the supplementary budget should be guided by the sums already being expended by trustee or imperial nations in underdeveloped areas under their control and that it should be made clear that non-self-governing territories should be considered for assistance equally with independent territories.

[matter omitted][3]

(5) It was agreed that a major part of the share of local operational expenditure should be borne by the governments in whose territories projects are being carried out. It was not thought that this share should appear in the budget though some argument was advanced by the Treasury contribution that to budget for gross expenditure would mean that the U.S. paid 70% in hard currency, the host country probably the remaining 30% and the rest next to nothing.

It would therefore only appear that budgets should contain an account of receipts where the visited country contributes in a currency different to that which is expended by the mission so that a sum of currency comes into the organisation for which a use has to be found.

There was some discussion as to whether the local contributions should in some cases be offset against supplementary budget contributions. This was considered inadvisable though the fact might be taken into account when assessing supplementary contributions.

(6) New provisions were considered advisable to urge the problem of co-ordination to be explored in particular that a common Australian attitude should be developed at each agency meeting taking into account the Australian primary responsibilities to the Territories and the S. Pacific Commission. It was considered important wherever possible that regional agency areas should coincide.

[matter omitted]

The Treasury representative also indicated that in some cases hard currency contributions to supplementary projects might be considered if they brought forth very large U.S. contributions.

He also stressed that Budget divisions between permanent work of the Organisation and supplementary operational work in connection with the international development programme should be maintained in all agencies.

[1] This refers to paragraph 17 of the attachment to Document 252.

[2] The numbered paragraphs correspond to the sections in paragraph 17.

[3] Omitted matter concerns some rewording of paragraph 17.

[AA : A1838, 716/1/1, II]