Progress toward monetary stability and the more efficient use of manpower have contributed to the improvement in production and trade. With few exceptions, the participating countries have achieved some success in coping with the disruptive effects of inflation. Rises in both prices and the money supply slowed down significantly in most countries during 1948. Improvements in living conditions, transportation, and supplies of materials and fuels are permitting increased output per worker, although productivity has not generally regained prewar levels. The wartime dislocation of the labor force has been largely overcome but scattered labor shortages hinder the expansion in production. On the other hand, unemployment is serious in Italy and Greece and among displaced persons. The gains achieved by the participating countries in the early phases of the European recovery program must be set against the longer-run task of recovery and stability. To realize this goal, new levels and relationships between production, trade, and consumption are required. While the recovery trends are encouraging, the participating countries still have many difficulties to overcome before a satisfactory balancing of international accounts is achieved. (e) Regarding the efficient and practical use of foreign assets located in the United States, what steps have each participating country taken to locate, identify, and put into appropriate use" these assets and earnings therefrom? What encouragement and aid has the United States offered to assist this program? (Sec. 115 (b) (4).) On October 14, 1948, the Agent General requested the Secretary of the Treasury to arrange for the transmittal of reports upon a continuing basis, with respect to the location, identification, and use of assets and earnings therefrom, which belong to the citizens of participating countries, and which are situated in the United States. A copy of this letter follows: Hon. JOHN W. SNYDER, Secretary of the Treasury, Department of the Treasury, OCTOBER 14, 1948. Washington, D. C. MY DEAR MR. SECRETARY: Section 124 of the Foreign Assistance Act of 1948 vests in this joint committee the responsibility for continuous study of the programs of United States economic assistance to foreign countries, including the review of the progress achieved in the execution and administration of such programs. The Appropriations Act, Public Law 793 of the Eightieth Congress further extended the duties and responsibilities of the joint committee to programs carried out by appropriations for Government and relief in occupied areas. In the exercise of its function of maintaining this continuous study, it would be a considerable aid to the work of the joint committee if constituent agencies of the Department of the Treasury might be directed to keep the committee advised of their policies and programs under this legislation. The committee is anxious to proceed in the accumulation of information pursuant to provisions of section 115 (b) (4) of the Foreign Assistance Act of 1948. I would appreciate it if it could be arranged to have appropriate divisions of the Department, particu larly the Office of International Finance, instructed to forward to the committee, upon a continuing basis, such reports relative to assets of citizens of participating countries situated in the United States, and measures taken by respective countries with regard to their utilization, as may be available. You have my assurance that whatever information of a classified nature may be involved will be respected accordingly by the committee staff. Material may be addressed, from time to time, to the joint committee on Foreign Economic Cooperation, room 200, 101 Indiana Avenue NW., Washington, D. C. With kindest regards. Sincerely yours, CHARLES S. DEWEY, Agent General. The following reply was received from the Secretary dated October 29, 1948: Mr. CHARLES S. DEWEY, TREASURY DEPARTMENT, Agent General, Joint Committee on Foreign Economic Cooperation, Congress of the United States, Washington, D. C. DEAR MR. DEWEY: Further reference is made to your letter of October 14 requesting that certain material be sent to your committee to be used in connection with its accumulation of information pursuant to the provisions of section 115 (b) (4) of the Foreign Assistance Act of 1948. In accordance with your request there are herewith transmitted two tables containing statistics with respect to the property which continued to be blocked under the Trading With the Enemy Act as of June 1, 1948, and which the census on Form TFR-600 revealed to be held for nationals of blocked countries receiving aid under the European recovery program (hereafter referred to as the blockedrecipient countries). No public disclosure of these statistics has as yet been made and it is requested that the information contained in this letter not be made public. Table I, generally speaking, includes only statistics with respect to property held by persons who are citizens of blocked-recipient countries and who resided at the time the census was taken in the countries of which they are citizens. However, where citizenship was stated as being unknown, it was assumed that the person is a citizen of the blocked-recipient country in which he resided. Furthermore, any report which showed that a citizen of a blocked-recipient country had left that country subsequent to June 1, 1947, was tabulated as though the national had remained in the country of which he is a citizen. It also should be noted that assets held in an omnibus account in a bank, located in a particular blocked-recipient country are shown for that country notwithstanding our lack of knowledge as to the beneficial ownership of the assets. Table II relates to property of citizens of blocked-recipient countries who at the time of the census resided in blocked-recipient countries other than the ones of which they are citizens. Table II is set up in the following manner: The left-hand column shows the country of which the national whose property is reported is a citizen. The countries enumerated across the top of the table indicate the country in which the national resides. The statistics within each box show amounts in three categories plus a total. The first category includes bullion, currency, and deposits. The second category includes financial securities payable in dollars. The third category includes all other assets. The breakdowns are totaled both at the right side and at the bottom of the table. At the right side can be ascertained the total amount of assets of persons of a given citizenship residing in the various foreign countries listed at the top of the table. At the bottom of the table can be ascertained the total amount of assets held by residents of a given country who are citizens of the countries listed at the left side of the table. The figures enclosed in parentheses show the number of reports filed. Both tables include all relevant reports which were tabulated through September 3 by which time a total of 18,499 reports had been received. It is believed that this constitutes substantially the total number of reports which will be received as a result of this census, although a very small number of reports have continued to trickle in. The following table shows the break-down of reports thus far received: Reports covered by table I. 5, 160 Reports covered by table II. 190 Reports of property of citizens of non-recipient-blocked countries who reside in the countries of their citizenship.. 5,552 Reports of property of citizens of blocked countries who reside in nonrecipient-blocked countries but who are not citizens of the countries in which they reside... 528 Reports of property of citizens of non-recipient-blocked countries who reside in recipient blocked countries... 396 Duplicate reports (not tabulated).. 12, 500 Unnecessary reports (not tabulated). 721 1700 Reports showing indeterminate values only (not tabulated). Reports in connection with which further correspondence is necessary to obtain additional facts (not tabulated)....... Reports with respect to citizens of nonblocked countries residing in blocked countries (not tabulated). Total... 1 Approximate. 1 100 1,076 116, 923 The term "non-recipient-blocked countries," as used above, includes most of the countries of Central Europe plus Japan. It will be observed that some 1,576 reports which have been received have not been classified in the foregoing break-down. These are reports which present various unusual problems. Most of them will require special analysis and handling. Included among these reports are, for example, reports with respect to Swiss corporations owned by persons of various blocked nationalities, reports with respect to assets of Argentine corporations owned by persons of various blocked nationalities, reports with respect to the assets of blocked persons residing in the United States, reports with respect to assets held through blocked countries by persons physically outside of such countries, etc. With the exception of reports relating to property held by citizens and residents of Sweden, copies of all reports listed in tables I and II have been transmitted to the government of the country of which the national whose property is reported is a citizen, and copies of all reports listed in table II have also been sent to the government of the country in which the national resides. Reports with respect to Sweden will not be sent to that country until such time as it actually starts to receive aid from the United States and thus qualifies as a recipient country within the meaning of the February 2 letter from Secretary Snyder, as Chairman of the National Advisory Council, to Senator Vandenberg, as chairman of the Senate Foreign Affairs Committee. It will be noted that approximately 700 reports showing indeterminate values only were not tabulated. These reports covered, for example, contingent interests in trusts or estates where the contingency has not yet arisen and the value of the interest was not subject to ready determination. To the extent that these reports dealt with citizens of blocked recipient countries, residing in their own or other blocked recipient countries, copies of the reports have been made available to the appropriate foreign governments. It should be noted in connection with the foregoing that in accordance with Executive Order No. 9989 of August 20, 1948, the files relating to the census of property on Form TFR-600 have been transmitted to the Department of Justice, to which was transferred, as of midnight, September 30, jurisdiction with respect to property remaining blocked as of that time. The Department of Justice is continuing to process the census reports and will transmit to this Department from time to time such additional relevant information as this processing reveals. Either this Department or the Department of Justice will be glad to transmit to you for your use all additional information which may be of significance to your committee. Your attention is called to information relating to capital movements between the United States and foreign countries presented monthly in the Treasury Bul letin published by the United States Treasury Department. Though these tables do not show blocked or restricted assets separately, they furnish data on net movement of capital and short-term banking funds, net movement in brokerage balances and long-term security transactions by foreigners, and data as of the end of the month on short-term claims on and liabilities to foreigners, foreign debit and credit balances in brokerage accounts and purchases and sales of longterm securities by foreigners. "Foreigners" as used in these reports refer to institutions and individuals, whatever their nationality, who are domiciled outside of the United States. These data available in the Treasury Bulletin are consolidated from monthly reports by banks, bankers, and brokers in each Federal Reserve district. Should you be interested in these data at any time before publication, they will be made available in preliminary form on a confidential basis a month or two prior to publication. In addition, quarterly reports are consolidated from the 12 Federal Reserve districts showing liabilities to and claims on foreigners of exporters, importers, and industrial and commercial concerns. These reports, while not yet published, could also be made available at your request. This Department has advised the Economic Cooperation Administration of your request, since it is now primarily the responsibility of the Administrator of ECA to follow measures to be taken by the recipient countries in regard to the utilization of their foreign assets. The Administrator will presumably advise you in this regard. Very truly yours, JOHN W. SNYDER, Secretary of the Treasury. |