The $51.9 million required for specific projects may be analyzed as follows: [In thousands of U.S. dollars]

I. Countries presenting no exchange problems Among these 33 countries are 31 of the 37 nations with which the United States had entered into agreements for the disposal of surplus agricultural commodities pursuant to Public Law 480, as amended. (Of the remaining 6 of the 37, 2, Bolivia and Paraguay, are included in group III and 4, Iceland, Indonesia, Netherlands, and Peru, are not represented in the 1961-65 program.) These 33 countries also include 19 of the 28 countries having residual local currency availabilities at June 30, 1958, under surplus property and lend-lease indebtedness agreements. (The nine others are not represented in the 1961-65 program: Belgium, Czechoslovakia, Ethiopia, Hungary, Norway, and the four listed above as having Public Law 480 agreements.)

These 33 countries represent:

(a) 96 percent of the potential additional foreign exchange availabilities programed under section 104(f) of public Law 480 but not yet transferred to Treasury sales accounts;

(b) 93 percent of the amounts programed for loans under section 104 (e) and (g) of Public Law 480;

(c) 78 percent of the local currency options remaining on June 30, 1958, under lend-lease and surplus property credit agreements;

(d) 99.8 percent of the estimates of the U.S. Treasury of excess receipts of foreign exchange in 1959; and

(e) 56 percent of the cost of specific projects included in the proposed 1961-65 buildings program.

II. Other countries in which a substantial portion of requirements may be met from local currency holdings

In these 13 countries are 12 percent of the cost of specific projects included in the proposed 1961-65 buildings program. Together with the 33 countries in group I, these 46 countries account for 68 percent of the costs of specific projects, of which about 95 percent would be financed from U.S. Treasury holdings of local currencies.

The currency requirements of group II would be derived from currency receipts (as in Canada), by conversion of available currencies, and by purchase of materials in countries where Treasury holdings are adequate.

III. Countries in which there are no adequate local currency availabilities Nearly one-third of the cost of the specific projects included in the proposed 1961-65 buildings program on the basis of need and priority is related to projects in countries in which the U.S. Treasury has no holdings of local currency and such currency is being acquired only by purchase with U.S. dollars. This highlights the fact that while large sums of certain foreign currencies are being generated by certain aid or surplus disposal programs, this condition is not general or worldwide, and, in fact, is somewhat concentrated in a limited number of countries and currencies. Maximum exploitation of these surplus currencies alone will not finance a worldwide program based on need and priority. Local currency usage must be supplemented with substantial U.S. dollar resources to finance needed facilities in countries in which there are no local currency holdings.

TABLE 1-b-1.-Analysis of local currency and U.S. dollar requirements of the proposed foreign buildings program for 1961-65 and comparison of local currency requirements for the period 1959-65 with estimates of local currency availabilities

SUMMARY

[In thousands of equivalent U.S. dollars]

Excludes $5,871,000 in war asset disposal accounts administered by GSA.

? On the assumption that the proceeds of surplus agricultural products disposal equals
estimates and the maximum level of agreed transactions will be consummated, these
amounts will be transferred to Treasury account for sale for appropriated dollars.

On the same assumption as stated in (2) above, these amounts are programed for the
purpose of loans authorized by secs. 104 (e) and (g) of Public Law 480, as amended.
Assuming that loans are made, the borrower has the option of repayment in dollars at a

lower interest rate, or repayment in local currency. In this study, potential interest
earnings have been excluded, and no provision has been made for dollar repayments.
The amounts shown are those available for loan.

'No collections have been received under this agreement of June 7, 1957.

NOTE.-Amounts are rounded to the nearest thousand and will not necessarily add to

totals similarly rounded,

2,116

4,409

20,700

1,486