761.56/2–150
Memorandum by the Assistant Secretary of State for European Affairs (Perkins) to the Secretary of State
If the Soviet Ambassador2 should raise with you this afternoon the question of a lend-lease settlement, particularly the lack of response by this Government to his note of September 30, 1949,3 it is suggested that you reply along the following lines:
1. Soviet Failure to Return 186 Lend-Lease Naval Graft
On October 7, 19484 this Government made a formal demand upon the Soviet Government under Article V of the Master Lend-Lease Agreement of June 11, 1942 for the return of 217 Lend-Lease Naval Craft. After repeated delays, detailed arrangements for the return of 30 of these vessels (27 frigates and 3 icebreakers) were agreed upon5 and subsequently the frigates and one of the icebreakers were returned (the remaining 2 icebreakers claimed to be icebound are to be returned in the spring) to United States custody. The Soviet experts who, according to the Soviet note of December 9, 1948,6 came to the United States to arrange for the disposition of all Naval Craft, departed from the United States without discussing the return of the remaining 186 vessels. In accordance with the provisions of Article V of the Agreement of June 11, 1942, the obligation to return these vessels is clear and specific and, until satisfactory arrangements are made in this respect, this Government considers the Soviet Government as continuing in default of its lend-lease obligations.
2. Soviet Settlement Proposals of September 30, 1949 Completely Negative
In its note of September 30, 1949 the Soviet Government adhered to its previous settlement offer of $200 million which had been increased nominally from the original Soviet offer of $170 million. Although we [Page 1284] estimated the lend-lease inventory to have a value of $2.600 billion, our first demand was for $1.3 billion which has been reduced in our note of August 18 [8], 19497 to $1.0 billion.
In view of the apparent Soviet default with respect to the Naval craft and in view of apparent Soviet unwillingness to reach a prompt and mutually satisfactory overall settlement through negotiation, as evidenced by failure to increase their offer toward a reasonable amount, the United States Government is re-examining the current status of the negotiations and the resulting conclusions will be communicated to the Ambassador in the immediate future.
- Alexander Semënovich Panyushkin.↩
- Foreign Relations, 1949, vol. v, p. 742.↩
- Ibid., 1948, vol. iv, p. 1012.↩
- Agreement on dates and procedures for return of 3 icebreakers and 27 frigates of the United States Navy received by the Union of Soviet Socialist Republics under the Lend-Lease Act, signed at Washington on September 27, 1949. For text, see Department of State Treaties and Other International Acts Series (TIAS) No. 2060, or 63 Stat. 2810.↩
- Foreign Relations, 1948, vol. iv, p. 1020.↩
- Foreign Relations, 1949, vol. v, p. 717.↩