Foreign Relations of the United States: Diplomatic Papers, 1945, European Advisory Commission, Austria, Germany, Volume III

740.00119 E.W./11–1145

The Ambassador in France (Caffery) to the Secretary of State

Paris, November 11, 1945.
[Received November 11—2:20 p.m.]

6543. From Angell No. 42. French position on application of gold pot to ex-enemy countries following:

1. Italy. French appreciate arguments based upon economic desirability of restoring a portion of Italy’s gold. French would appreciate additional information regarding disposition of Italian gold allegedly found at Brenner. Is it in Allied hands? Has it been included in the pot? With these questions in mind France is disposed to accept principle that Italy should participate in gold pot provided these “conditions” are met.

(1) All Italian gold wherever located is put into pot. If Italy has already had some gold returned to her by Allies even if that gold never left Italy its return should be charged against Italy’s share of pot:

(2) That Italy restore to France out of Italy’s share of pot 15 tons of gold. According to French they were obligated in 1941 under duress to allow Italy a drawing account supported by gold for financing deliveries of war material to Italy. France considers this a restitution claim against Italy. France’s claim does not go into gold pot which is confined to claims against Germany.

(3) That the US and UK join France in strong demands upon Switzerland that Switzerland return to Germany for inclusion in pot 110 tons of Belgian gold received by Switzerland after prospect of United Nations Declaration of January 5, 1943¹⁴ but before the gold declaration of following year.¹⁵ In French view earlier general declaration regarding looted property was sufficient to put Swiss on notice. (Oliver¹⁶ understands that Schmidt¹⁷ has discussed this question with Rubin.)

If these conditions are met French agree to immediate Italian participation in disposition of gold. Otherwise they would insist that Italian right to restitution be deferred for peace treaty settlement. Rueff later indicated privately he would withdraw third condition.¹⁸

2. Austria. France does not consider that Austria is entitled to participate in gold pot. Reason advanced is that Austrian gold reserve was taken at Anschluss and incorporated into Reich monetary system. Gold was presumably consumed in German economic development of Austria. I feel that Rueff is not personally happy about this conclusion or the reason advanced to support it. I made the obvious point that French position here seemed unduly theoretical and in contrast to what France had termed its practical approach to Italian problem. I also stated that even on theoretical grounds French argument was unconvincing. Rueff stated French would be prepared to discuss this farther.

3. Hungary. France does not consider that Hungarian gold should be returned at all. However, they will agree to Hungarian participation in pot provided that disposition to Hungary of its share is held in abeyance until there is a peace settlement with Hungary. To preserve a previous argument of mine I took the stand that whole amount of Hungarian gold, rather than its pot portion would have to remain undistributed.

4. Albania. The Albanian gold should be restored in full by Italy to Albania out of Italy’s share in pot. This is regarded by French as similar to 15–ton claim of France against Italy.

Ref Dept’s No. 21.¹⁹ I urge speedy clearance of pot principle. Otherwise I cannot continue to take such a strong position supporting pot. Should clearance not be obtained, I can still withdraw in view of complications which French have injected. From Deptel No. 20 for Angell²⁰ I infer that French position regarding inclusion of Italian gold found in Italy would not be acceptable to Department. Department’s comments and instructions urgently requested. [Angell.]

Caffery

14. For text of the United Nations declaration regarding forced transfers of property in enemy-controlled territory, see Foreign Relations, 1943, vol. i, p. 443, or Department of State Bulletin, January 9, 1943, p. 21.
15. For text of the United States declaration on gold, February 22, 1944, see Foreign Relations, 1944, vol. ii, p. 213, or 9 Federal Register 2096. Similar statements were issued by the British and Soviet Governments.
16. Covey T. Oliver, Associate Chief, Division of Economic Security Controls, and Counselor to the U.S. Delegation to the Paris Reparations Conference.
17. Presumably Orvis A. Schmidt, Director, Foreign Funds Control, U.S. Treasury Department.
18. Telegram 6605, November 15, noon, from Paris, not printed, reported that the United States, the United Kingdom, and France had agreed to approach the Swiss separately concerning German gold held in Switzerland; the French had consented to make Swiss action on the Belgian gold a wish rather than a condition in their approach (740.00119 EW/11–1545).
19. Reference is to telegram 5219, November 8, 7 p.m., to Paris, which had indicated that if the gold pot was approved in principle, the claimant countries would have to submit statements on gold lost in Germany, including substantiation of any restitution claims advanced (740.00119 EW/11–245).
20. See telegram 5221, November 8, 6 p.m., to Paris, p. 1376.