DOLLAR BAN ON PERSIA

Press, Volume LXXXVII, Issue 26524, 12 September 1951, Page 7

DOLLAR BAN ON PERSIA

Economic Action By Britain

(N.Z. Press Association—Copyright)

;(Rec. 9 p.m.) LONDON, September 11. The city editor of the “Daily Express” said to-day that Persia will lose as much as 100,000,000 dollars a year from Britain under the new economic ban announced by the British Treasury. The Treasury action, he said, “removes the remaining props to Persia s shaky finance. “Already Persia’s chief money-spinner, oil, has become valueless.

The political correspondent of the “Daily Express” declared that the new restrictions may bring a violent response from Dr. Mussadiq, but the British Cabinet was fully prepared to take whatever steps were necessary to protect the 350 British oilmen still in Abadan.

Earlier it was announced that Bri- , , withdrawn special dollar f acillties from Persia and said that all Sterling payments to and from Persia would oe subject to the permission of the Treasury. Because of the importance of Persian oil to the British economy, Persia had special facilities not normally open to non-members of the sterling area for the conversion of sterling into dollars. Slje also enjoyed the automatic right to make use of sterling for payments to and from countries in the sterling area and certain other countries. The Treasury also announced that Britain would no longer supply scarce goods which she had previously let Persia have because of the value of her oil to Britain. These goods were urgently required in Britain or could be sold for dollars to other markets.

‘Justification Removed” The Treasury statement said: “The cessation of exports of oil from Persia not only removes the justification for these exceptional facilities, but also makes it necessary for the United Kingdom to spend large sums of dollars on the replacement of oil. “In these circumstances the Government can no longer afford to supply Persia with dollars. For this reason, it has been necessary for the Treasury to make an order under which all sterling payments to and from Persia will be subject to the permission oi the Treasury.’’ “Can Be Revoked” The announcement explained that the intention was to withdraw only exceptional facilities that could no longer be justified. Tne statement added: "It is the Government’s sincere hope that the need for these measures will not be of long duration. Their intention is to limit the harm which has been caused to the United Kingdom economy by the actions of the Persian Government, and the measures can be revoked whenever the Persian Government makes possible a solution to the Oil question.” , Reuter states that Persia is understood to have £14,000,000 available in London in sterling balances. Of this about £3.000,000. equivalent to about 8,400,000 dollars, was available for conversion into dollars.