FINANCING GERMANY

Chronicle (Levin), 19 December 1947, Page 5

FINANCING GERMANY

(N.Z.P.A.—

-Reuter,

United States Takes Major

Copyrlgkt)

Received Thursday, 7.40 p.m-. LONDON, Dee. 18. An agreement between Britain and the Fnited States for the future finaneing of their merged zones in Oerxnany, which was signed m WasMngt-on lasi night,. revises and extends the bizonal t'usion agreement between the countries uade on December 2, 1946. It does no't lii'ect the political or military aspects )f ihe occnpation of Germany but drastically alters ihe proportions of the •ost of running the two zones. Under the 194(3 agreement the cust ot providmg impor-ts to maintain tlie zones was divided equallv between the , two" eountriqs. I'nder .the new • agreement the United States is to pay 80 per eent. and Britain 20 per cent. of ihe costs. No account is taken of ex[1 c ml i ture 011 the occupation and control stalf in Germany. Allowing for this, the United States'' expenditure for 1948 will be about three times that of Britain's or 75 per cent. of • the whole. The British contribufion will be con lined to sterling expenditure on imports from 'the sterling area. The existing adminiktrative arrangements within Geriuany for the bipartite control of econotiiie affairs, are not disturbed but it luis been agreed that in view of its larger financial contribulion, the United States is to have ihe deciding voice in operations of the joiut export-import and foreign exchange agencies because Britain fopnd it impossible to continue to pay dollars for essential imports for Germany. The United States Government was .aceord.ngly asked to ugree.to a revision.. Under the Anglo-American agreemeui for the provision of imports for the iii-zonal area of Germany, the saving to Britain in 19-18 will be 256,090,001:) lollars. United States has undertaken co provide essential imporjs worth 100, 000, 000 dollars for the period November 1 to December 31 for the tiroa. A11 annonncement says Britain has in no way aeeepted the role of junior partner in Germany. The United States .\ i 11 huve a majority only in the joiiu 1 export-import agency and joint foreign exchange agency. The United States Government agreed, in recttgnuion oi tlie United Kingdoin 's serious dollar ditli culties, that the operations of the joint export-import agency sliall be conduci.jd so that not niore than- the sterling equivalent of 40,000,000 dollars shall, .nuler the agreement, require to be eonverted in 1948. Tlie Times says that under the agreenent American and British sharcs in he cost of the occupation of Germain a-ill be approximately m the proportion of three to one instead of equal. Tlie announcenient ended: "The hope jf the two Governments nnderlying the .igreement is to establish as soon as possible an eeononiy in the bi-zonal area ' of Germany which can 1 >e maintained without assistance from either Government and which may contribute to »Furope''s jieaei-ful rchabilitation'. "