DEPARTMENT OF STATE Memorandum of Conversation
Date: July 12, 1949
SUBJECT: Beira Port and Railway
PARTICIPANTS: Portuguese Ambassador Secretary of State
T. C. Achilles, EUR
COPIES TO: S/S AF - Mr. Awalt TRC/S - Mr. Harway IR - Mr. Bramble ED - Mr. Beigel DRE - Miss Sullivan SWE - Mr. Dunham American Embassy, Lisbon
The Ambassador called at his initiative and discussed the question of the development of the Beira port and railway. He recalled that the US government had first raised the question with his Government some months ago at the instance of the ECA in view of the importance attached to this development project with a view to expediting the transportation of strategic materials from the Rhodesias. Since that time the Lisbon conference on transportation problems in Central Africa had reached agreement that the development should be pushed and the Portuguese and UK Governments had agreed on the transfer of the railway to Portugal. The Portuguese Government had paid the British Government $26 million for the railway and had authorized another $24 million for its development. The British Government was most anxious to furnish the equipment for development of the port and railway and had agreed that blocked sterling could be used for this purpose but the Portuguese Government believed that it would take a long time to obtain the necessary equipment in the UK and that it could be better and more quickly be obtained in the US. His Government estimated that the cost, if ECA could finance it, would be $16 million (in addition to the $24 million in local currency which the Portuguese Government would expend).
He wished to know as quickly as possible whether ECA would be in a position to finance the project. He strongly hoped that it could be financed by ECA but that the very limited allocation of ECA funds for metropolitan Portugal was far from an encouraging sign.
Said that this Government was definitely interested in the development project and that I would ascertain ECA's view on financing and let him know as soon as possible but that ECA might not be in a position to give a definite view until the present uncertainty as to its appropriation had been resolved.
Dean Acheson
EUR:TCAchilles:bsm