AMERICAN AID TO EUROPE

Press, Volume LXXXV, Issue 25732, 18 February 1949, Page 7

AMERICAN AID TO EUROPE

CHANGE PROPOSED IN TERMS DELETION OF CLAUSE ON LOANS (N.Z. Press Association—Copyright) (Rec. 7 p.m.) WASHINGTON, Feb. 16. The Secretary to the Treasury (Mr John Snyder) told the Senate Foreign Relations Committee to-day that it would be a better policy for Congress to renew the European Recovery Programme without the clause forcing nations to take part of their aid in loans. The present bill provides that about a fifth of the first year’s outlay to Europe must be in loans. Mr Snyder said that European nations should make greater efforts to put their finances in ordqp. He suggested that the United States should explore currency devaluation with the European countries. This would enable the countries to balance their international accounts and relieve their dependence on United States aid. “It becomes a matter of grave and direct concern to us when a European country tends to retard its exports or misdirect its trade and increases its deficit with the Western Hemisphere,” he said.

European governments were reluctant to change their exchange rates for fear of adverse internal political consequences, or serious repercussions on their domestic economy, he added. However, the past year had produced notable signs of improvement in the financial situation in Europe. There should be reasonable financial stability in 1952, barring some unforeseen drastic deterioration of the • international situation.