Marshall Aid May Prove A Burden

Chronicle (Levin), 3 June 1948, Page 5

Marshall Aid May Prove A Burden

Eeceived Wednesday, 7 p.m. WASHIXGTOX, June 1, Britain has informed the Economic Cooperation Administration that it canuot accept dollars in the form of loans unless they are intended for self-repay-ing projects and not for the consmuption of goods. The result of this de cision will be that 100, 000, 000 dollars te.ntatively allocated to Britain bv the Economic Cooperation Administration in loans for the quarter ending- June 30, may lie idle fov some time wliile British oflicials and administration experts work out details of the projects inutually satisfactorv to both sides. British oflicials have been eonsiderably exercised about the advisabilitv of accepting more dolla'- loan burdens. They were disturbed over the f'act that, of Britain 's eurrent quarter Maisliall plan allocation of 400,000,000 dollars in grants and loans, -25 per cent was specificallv labelled as being avail able 011 a loan basis onlv. It is understood these loans will carry a heavjer interest rate than the original poptwar American loan to Britain, therebv adding to the considerable annual dollar repayment obligation that Britain nmst assure st:irti)ig in 1952. The decision, therefore. is that no eurrent consumption goods such as wheat, cotton, tobacco, food, petroleum, ete., will be paid for in dollar loans. The question that remains, however, is whether Britain, if she eontinues to get 25 per cent. of her "Marshall plan allocations in the form of loans, can utilise fhem adequatelv on ihe purchase of capital equipnient for evport production for the dollar area without nssuming burffensome repayment obligations. It appears to be a question whereon neither side has yet made up its mind.