864.50/1–1146

Memorandum of Conversation, by the Acting Chief of the Division of Southern European Affairs (Reber)

confidential
Participants: Hungarian Minister-designate;1
Mr. Reber and Mr. McKisson of the Southern European Division.

The Hungarian Minister-designate to the United States called formally today on the Acting Chief of the Southern European Division to bring to the Department’s attention several matters which the Hungarian Government considered of immediate and vital importance. The subjects included relief for Hungary, tripartite Allied assistance to Hungary in its present grave economic situation, and the return to Hungary of property, including industrial equipment, removed by the Germans upon their evacuation of Hungarian territory.

The Minister said that he had been pleased to learn, soon after his arrival, that the Central Committee of UNRRA had approved a $4,000,000 relief program for Hungary.2 He spoke of the extremely bad food situation in Hungary and its deleterious effects upon the national health and productive capacity. He said that, while the UNRRA program would meet only a small part of existing urgent needs, the psychological effects of such assistance would be considerable and would tend to bolster public morale. The Minister remarked that the current yield of wheat in Hungary was only a fraction of pre-war production and that, in view of the generally poor crop in other wheat-producing countries, it appeared unlikely that UNRRA would have [Page 251] available stocks to alleviate this deficiency. Mr. Reber remarked that the Department was pleased that UNRRA had reached a favorable decision on the extension of relief aid to Hungary, as we were fully aware of that country’s critical human needs. He agreed that the prospects of obtaining wheat were unfavorable and pointed out that the lack of transport had further complicated this problem.

The Minister said that the second problem with which his Government was deeply concerned was its failure thus far to obtain ACC3 action in setting up a tripartite Allied program for the rehabilitation of Hungarian industry, agriculture, and transport which would enable Hungary to meet its reparations, armistice, and other obligations. In this connection, he recalled that early in December the Hungarian Finance Minister (Gordon) had attempted to bring to the attention of the ACC Hungary a copy of a detailed report on the financial and economic situation in Hungary.4 This report, which requested the appointment of an Allied Commission to survey the problem and prepare a program of rehabilitation was rejected without consideration by the Soviet chairman. Later, however, the ACC directed the Hungarian Government to submit an official statement of Hungary’s economic and financial condition, together with the Government’s proposals for improving the situation. The Minister expressed the fear that nothing would come of this unless the United States pressed strongly for the formation of a tripartite commission. Mr. Reber assured the Minister that this Government favored the creation by the ACC of a preliminary tripartite commission which would prepare recommendations, that we hoped the ACC would adopt such a proposal, and that the Department would continue to give close attention to the matter.

The Minister next referred to the desire of his Government to secure the return of Hungarian property, including vitally-needed industrial equipment, which was removed by the Nazis to Austria and Germany during their occupation and subsequent withdrawal from Hungary. He said that the Hungarian Communists were endeavoring to make political capital out of the non-recovery of this property and were using the situation to weaken pro-American sentiment in Hungary. He urged that at least Hungarian representatives be allowed [Page 252] to enter the American zone to investigate the status of such property. Mr. Reber said that we were aware of these various aspects of this problem, which was very complicated, and that the whole matter was currently under consideration.

In closing the conversation, the Minister called attention to the interpretation being placed by various newspapers and commentators upon the results of the recent Moscow Conference of Foreign Ministers5 as effecting the division of Europe into spheres of Great Power influence. He said that this was a development greatly feared by Hungary, since it was in a position geographically and otherwise where it would be mercilessly ground between the opposing weights of such alignments, and enquired whether there was any basis for these estimates of the situation. Mr. Reber assured the Minister that this Government was strongly opposed to the establishment of any such arrangement, that the results of the Moscow meeting could not correctly be interpreted as a reversal of decisions reached at Potsdam and Yalta6 but rather as supplementary agreements in essential harmony with those previous decisions. He cautioned the Minister against uncritical acceptance of such press comments and pointed out that statements in the free American press and over the radio should not be confused with official declarations by this Government or assumed to reflect the official views or position of the United States on various questions.

The Minister also called on Mr. Barbour7 of the Southern European Division. The only new subject covered concerned the Hungarian Government’s desire to establish a consulate in New York, where there is a large Hungarian population. The Minister indicated that the establishment of such an office in New York would greatly simplify the Legation’s tasks in this country and facilitate the discharge of consular functions. A consular officer is to be attached to the Legation here for the present.

  1. Szegedy-Maszák presented his letters of credence to President Truman on January 18, 1946.
  2. The Hungarian Government’s request for aid from the United Nations Relief and Rehabilitation Administration (UNRRA), which was strongly supported by the United States Government, was authorized by the UNRRA Central Committee on January 8, 1946, and was formally approved on February 4. The UNRRA Mission reached Hungary in April, and supplies began arriving there in May. For an account of UNRRA assistance to Hungary, see George Woodbridge, UNNRA: The History of the United Nations Relief and Rehabilitation Administration (New York: Columbia University Press, 1950), vol. ii, chap. XIV.
  3. Allied Control Commission (for Hungary).
  4. A copy of Finance Minister Ferenc Gordon’s report on the financial and economic situation in Hungary, dated December 3, 1945, had been given informally to the United States Representative in Hungary and had been transmitted to the Department with despatch 678, December 10, 1945, from Budapest, not printed. The Gordon Report was commented upon in telegram 1028, December 5, 1945, from Budapest, Foreign Relations, 1945, vol. iv, p. 917. For text of the concluding paragraphs of the Gordon Report together with commentary on its disposition in the Allied Control Commission for Hungary, see telegram 1907, April 26, 1946, to Paris, post, p. 290.
  5. The Tripartite Conference of Foreign Ministers, held at Moscow, December 16–26, 1945. For documentation on this Conference, see Foreign Relations, 1945, vol. ii, pp. 560 ff.
  6. The records of the conference between President Roosevelt, Prime Minister Churchill, and Marshal Stalin and their advisers at Yalta, February 4–11, 1945, are printed in Foreign Relations, The Conferences at Malta and Yalta, 1945. The records of the conference between President Truman, Prime Minister Churchill (later Prime Minister Attlee), and Generalissimo Stalin and their advisers at Berlin, July 17–August 2, 1945, are printed in Foreign Relations, The Conference of Berlin (The Potsdam Conference), 1945, 2 vols.
  7. Walworth Barbour, Assistant Chief of the Division of Southern European Affairs.