740.00119 Control (Germany)/12–745: Telegram
The United States Political Adviser for Germany (Murphy) to the Secretary of State
[Received December 8—9:59 p.m.]
1196. (1). At twenty-fifth meeting of the Coordinating Committee held yesterday, US member presiding …
(2). A long and at times embittered discussion, which was characterized by Russian hard bargaining, took place on the allocation of the first list of plants available as advance deliveries on reparations account. Agreement had been obtained in Economic Directorate on part of list representing allocation of roughly 86,628,000 RM value to the western nations and 52,658,000 RM to Russia and Poland. In reply to French observation that some of the plants contained looted material, Russian member made the significant statement that his Government was prepared to discuss the question of looted material in every case with a view to its possible return. Gen. Clay declared that until quadripartite agreement on restitution is reached the US zone commander will reserve his right to determine restitutable property.
Coordinating Committee then turned to rest and most important part of the first list, upon which agreement had not been reached in Economic Directorate and which contained valuable machine tool plants. Russians renounced any claim to Krupp Essen and openly declared their interest in machine tool plants to replace those destroyed by the Germans in Russia.
British member accused the Russians of wishing to pick only the plums and stated that as part of a fair bargain the British had in mind reserving for the Western Powers such plants as Schiess-Defries and the metallurgic plant at Dinslacken. General Clay made a compromise proposal which was debated in private by the experts. The latter’s conclusions which were finally adopted by the Coordinating Committee provided for the following allocations: To Russia and Poland—Krupp plant at Borbeck, Dinslacken metallurgical plant, and 13 million RM value of Schiess-Defries; to the Western nations—Blohn and Voss shipbuilding plant at Hamburg, BMW factory No. 1, and 3 million RM value of Schiess-Defries. Rough total values, including the plants from the first list agreed upon in the Economic Directorate mentioned above were estimated as follows: To Russia and Poland 115,260,000 RM; to the Western nations 120,500,000 RM. Krupp Essen is to be allocated later, but the British made a strong [Page 1448] reservation for keeping the railway repair shops in their zone for a period of at least 2 years to aid in transport repair.
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