FOREIGN RELATIONS) 19 5 0, VOLUME I


toward meeting the aspirations and demands of their people for the
satisfaction of their basic needs, to enable the governments thereby
to command allegiance and support, and to maximize the output of
materials essential to the continued strength of the free world.
  4. In determining whether and to what extent to provide U.S.
Government assistance in any given area, account has been taken of
aid likely to be made available by the IBRD and other sources, and of
increased dollar earnings that should result from expanded U.S. im-
ports, upward price movements, and U.S. troop expenditures abroad.
Aid has been scheduled in the form of U.S. Government loans for
development projects normally regarded as bankable where it appears
that recipients can carry additional dollar debt. Aid has been sched-
uled in the form of grants for technical assistance projects, including
associated supplies and equipment required to make the technical
assistance projects effective. In certain exceptional cases, grant aid
has been scheduled for capital investment projects as well. This has
been done only in the case of countries of great strategic importance
to us, for which loans and investments cannot be contemplated in the
near future and which, in the absence of certain capital goods, would
experience rapid economic deterioration and political instability.
  Making available funds for carrying out the foreign aid programs
outlined below will not in and of itself achieve the foreign policy
results desired. It will be necessary that the essential supplies, many
of which may be in short supply, be assured both for shipment under
the aid programs and for shipment for essential purposes where the
foreign countries themselves are able to furnish the necessary funds.
To accomplish this purpose as well as to minimize the drain on the
U.S. economy in the form of non-essential exports careful examination
will be necessary of the scope of our export controls and the policies
under which they operate.
  [Here follows Table ;3, "Actual and Anticipated U.S. Government
Grant and Loan Aid."]
                             NgOTES 9

  WVestern Europe: The estimates for Western Europe .are still in
discussion among ECA, -the Department of Defense, and the State
Department.
  Yugoslavia: Yugoslavia's disaffection from the 'Soviet Bloc has
subjected her economy to severe strains because of abruptly severed
trade relations with Cominform countries, heavy defense expenditures,
and the greater need to succeed as a Communist state in rapid indus-

  These notes accompanied Table 3.


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