apply. It will require implementing legislation to prohibit discharge by ships of American registry of oil or oily wastes in the prohibited zones beyond our territorial waters, to provide for the maintenance and examination of oil record books, and to prescribe penalties. Draft legislation for this purpose has been prepared and is ready for submission to Congress as soon as Senate advice and consent is given. The United States instrument of acceptance of the convention will not be deposited until the necessary legislation is passed.40

The convention contains a settlement-of-disputes provision of the type which in recent decades has been included in a considerable number of bilateral and multilateral instruments to which the United States has become a party. Article XIII provides that any dispute between the contracting parties as to the interpretation or application of the convention may be referred to the International Court of Justice. I should like to affirm that a specific provision of this type in a treaty is not subject to the self-judging domestic-jurisdiction reservation (the so-called Connally Amendment) to the general acceptance by the United States of the compulsory jurisdiction of the Court.1 I agree wholeheartedly with the statement of the former Legal Adviser of the Department 42 and the analysis of this committee as set forth on pages 8 and 9 of the committee report on the oil pollution convention. At the same time it may be emphasized that the question of whether the Connally Amendment would be operative is not a matter of any real pertinence in this case. The oil pollution convention is a traditional-type maritime treaty dealing with matters of legitimate international concern. It regulates the discharge of oil and oily wastes by seagoing ships, setting up prohibited zones for such discharge, and dealing with discharge facilities, oil record books on board ship, and enforcement measures. It is difficult to conceive that any matter of dispute arising under the convention could be construed as being within the exclusive domestic jurisdiction of this country. Matters that might arise under this convention would be matters which this Government would normally want to have submitted to the Court. It would be in the public interest to be able to submit them to the Court without the restriction imposed by reciprocal operation of a self-judging reservation.

The Department of State continues to recommend that United States acceptance of the convention be accompanied by an understanding concerning the supremacy of United States law within United States territorial waters, a reservation that the United States shall not be obliged to construct, operate, or maintain shore facilities for disposing of oily wastes, a reservation that amendments to the convention shall not be binding on the United States until accepted by it, and certain recommendations for future amendment. These are discussed and approved

40

See S. 2187, 87th Cong. (Public Law 87-167, approved Aug. 30, 1961; 75 Stat. 402).

41

See A Decade of American Foreign Policy: Basic Documents, 1941-1949, pp. 155-156.

"Eric H. Hager.

in the committee's report of last session (Executive Report No. 6, pages 5-8).

The committee was informed by a letter of April 20, 1961, from Assistant Secretary Brooks Hays 43 that two developments have occurred with respect to the convention since it was considered here last year. Poland has deposited its instrument of acceptance, bringing to 13 the number of countries which are parties, and a conference has been scheduled by the Intergovernmental Maritime Consultative Organization to be held from March 28 to April 12, 1962. The purpose of the conference would be to review the situation in regard to oil pollution of the sea and the working of the 1954 convention and to consider any amendments proposed by governments and the practicability of securing complete avoidance of discharge of persistent oils into the sea.

As long as the United States remains outside the convention it has little or no opportunity to improve the convention by amendments. The forthcoming conference will offer the only opportunity for some years to make the changes desired. By completing the ratification process the United States would be in a better position to obtain acceptance of its recommended changes at the conference.

The convention continues to have the support of the interagency National Committee for Prevention of Pollution of the Seas by Oil and of groups interested in the conservation of birds and other wildlife. It is, of course, of direct benefit to coastal areas and resorts adversely affected by oil pollution of the seas. The Department of State recommends that the Senate approve early acceptance of the convention in accordance with the committee's recommendation of last year.

INTERNATIONAL CONVENTION FOR THE PREVENTION OF POLLUTION OF THE SEA BY OIL, 1954, Entered Into Force for the United States, December 8, 1961 **

THE INTERNATIONAL ATOMIC ENERGY AGENCY

43 Not printed.

[See post, doc. 629.]

"TIAS 4900; 12 UST 2989. See S. Ex. C, 86th Cong., 2d sess., Feb. 15, 1960; International Convention for Prevention of Pollution of Seas by Oil: Hearing Before the Committee on Foreign Relations, U.S. Senate, 86th Congress, 2d Session, on Executive C, 86th Congress, 2d Session, May 17, 1960; S. Ex. Rept. 6. 86th Cong., 2d sess., June 2, 1960; International Convention for Prevention of Pollution of Seas by Oil, 1961: Hearing Before the Committee on Foreign Relations, U.S. Senate, 87th Congress, 1st Session, on Executive C, 86th Congress, 2d Session, April 25, 1961; and S. Ex. Rept. 4, 87th Cong., 1st sess., May 4, 1961. The Senate gave its advice and consent to acceptance of the convention by the United States, with an understanding, reservations, and a recommendation, by a vote of 92 to 0, taken May 16, 1961. The convention was ratified by the President, May 29, 1961; U.S. acceptance of the convention was deposited with the IMCO, Sept. 8, 1961; the President proclaimed its entry into force, Dec. 8, 1961.

THE INTERNATIONAL BANK

63. OPERATIONS OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT DURING THE PERIOD JANUARY 1-JUNE 30, 1961: Report of the National Advisory Council on International Monetary and Financial Problems, Submitted May 10, 1962 (Excerpt) 45

In the first half of 1961, the Bank approved loans in the equivalent of $317 million in 14 countries, including 3 countries which received their first loans from the Bank-Argentina, British Guiana, and Uganda. The cumulative total of Bank loans, net of cancellations, terminations, and refundings, was thereby increased to $5.7 billion, over three-fourths of which had been disbursed. Increases in the capital subscriptions of two member countries became effective in the current period, and sales of portions of Bank loans during this period increased the total of such sales through June 30, 1961, to over $1 billion.

MEMBERSHIP AND SUBSCRIPTIONS

In the period under review, Portugal and Nigeria became members of the Bank with capital subscriptions of $80 million and $66.7 million, respectively, and the membership application of Cyprus was approved by the Board of Governors. Pursuant to the increase in the authorized capital of the Bank from $10 billion to $21 billion on September 15, 1959, 62 members had doubled their subscriptions and, of this number, 29 members had subscribed to $1,396.9 million in addition to their 100-percent increase. In the current period, additional increases became effective for Bolivia ($14 million) and Ceylon ($30 million). On June 30, 1961, the Bank had 68 members with a total subscribed capital of $20,093.1 million. (See appendix table D-1.) 46

COMMITMENTS AND DISBURSEMENTS

The equivalent of $317 million in loans authorized by the Bank in the first half of 1961 was at about the same level as Bank commitments in the two preceding semiannual periods. The bulk of these funds was directed toward development programs and projects in Asia, Africa, and Latin America, and the purposes for which the funds were approved continued to reflect the Bank's emphasis on basic facilities. (See table 4.) 47 In Asia and Africa, loans ranged in amount from $8.4 million to the Protectorate of Uganda for electric power to $80 million for railway improvement in Japan. Other loans in this area provided $36 million for railway improvement in Thailand and Burma, $27 million for the expansion of electric power in Japan and Ceylon, $19.5 million to assist in financing construction of the Roseires

47

H. Doc. 402, 87th Cong., pp. 7-12. Part III of the NAC report.

Not reprinted here. See instead table E-1, appended to doc. 64, infra.
Not reprinted here.

Dam in the Sudan, and $15 million for the development of private industry in Pakistan. In Latin America, the Bank approved loans totaling $54.5 million for road construction and highway maintenance in Argentina and Chile; $30.8 million for electric power development in Colombia and Costa Rica, and $15 million for the improvement of irrigation in Mexico. In the case of the projects in the Sudan and Chile, the International Development Association at the same time extended additional credits totaling $32 million.48

In the fiscal year ended June 30, the Bank approved 27 loans totaling the equivalent of $610 million, an amount somewhat below the level of the preceding 3 years but substantially above the $388 million authorized by the Bank in fiscal 1957. Loan disbursements equivalent to $399 million were also below the level of the three earlier periods, although somewhat higher than disbursements in fiscal 1957 ($332 million). Through June 30, 1961, the total of 292 loans authorized by the Bank amounted to the net equivalent of $5.7 billion, of which $4.3 billion, or over 75 percent, was disbursed. (See table 5.) As indicated in this table, more than $1.5 billion was disbursed in currencies other than U.S. dollars, an increase of about $600 million over the comparable figure on June 30, 1959.

49

The International Bank continued to sponsor meetings of a Consortium of Governments interested in development assistance to India and Pakistan.50 The fourth meeting of the India Consortium, attended by representatives of the United States, Canada, France, Germany, Japan, and the United Kingdom was held in April and June 1961. Assistant Secretary of the Treasury John M. Leddy (the U.S. Executive Director of the IBRD) was head of the U.S. delegation. During this meeting France joined the Consortium as a member. At the June session, the members of the Consortium undertook commitments of aid to India amounting to $1,295 million for the first year of India's Third Five-Year Plan. For the second year of India's plan (Indian fiscal year 1962/3) the Consortium indicated commitments of $930 million, including $500 million from the United States contingent upon additional contributions from other members. The Consortium concerning aid to Pakistan met in June 1961 with representatives from the same governments which participated in the India Consortium. The U.S. delegation was headed by Assistant Secretary of State Edwin M. Martin. Commitments for Pakistan's Second Four-Year Plan made at this meeting totaled $320 million, in addition to $230 million in aid previously committed by members.

50

The India Consortium was a semiformal continuation of the ad hoc association of representatives of Canada, the Federal Republic of Germany, Japan, the United Kingdom, and the United States who met in Washington, Aug. 25-28, 1958, at the suggestion of the president of the International Bank to discuss measures for contributing to the financing of India's Second (1956-1961) Five-Year Plan; see the Department of State Bulletin, Oct. 6, 1958, pp. 545–546. The group met periodically thereafter.

The U.S. Executive Director of the International Bank, or his Alternate, acting on the advice of the Council, supported the decisions taken with respect to the foregoing matters.

DISTRIBUTION OF EXPENDITURES UNDER BANK LOANS

In the early postwar period, Bank loans were used almost exclusively for purchases in the United States. However, in view of the wider area of convertibility of the world's main currencies, the greater availability to the Bank of currencies other than U.S. dollars, and the improvement in the productive capacity of other areas of the world, the trend has continued toward larger loan expenditures in countries other than the United States for the types of heavy equipment chiefly financed by the Bank. In Europe, cumulative loan expenditures of the Bank increased from the equivalent of approximately $500 million at the end of June 1956 to $1.3 billion at the end of the period under review, an amount almost equal to total disbursements by borrowers for imports from the United States. As indicated in table 6,51 the largest disbursements for imports from countries other than the United States were to the United Kingdom ($503 million), Germany ($366 million), Canada ($138 million), and France ($119 million). Through June 30, 1961, approximately 49 percent of the goods purchased under the Bank's loans came from the United States, as against 62 percent through June 30, 1956.

SECURITY ISSUES AND SALES OF LOANS

The outstanding funded debt of the Bank at the end of the period under review was $2,228.5 million, reflecting a net increase of $70.1 million during the first half of 1961. In this period, the Bank borrowed-all from sources outside the United States-the equivalent of $444.6 million through the medium of two public bond issues, one in Swiss francs equivalent to $23.3 million, and one in Netherlands guilders in the equivalent of $13.8 million; the private placement of bonds and notes equivalent to $397.2 million, partly to raise new funds and partly as refunding operations; and the delivery of $10.3 million of dollar bonds previously sold subject to delayed delivery arrangements.52 The equivalent of $10.5 million was added to the funded debt as the result of the revaluation of outstanding German mark bonds and notes and Netherlands guilder bonds. The funded debt was decreased by $385 million due to maturing bonds and notes ($15 million), sinking and purchase funds redemptions ($9.1 million) and the refunding of privately placed issues equivalent to $360.9 million. It was estimated that over half of the Bank's outstanding funded debt was held outside the United States, including approximately $660 million of dollar bonds and notes of the Bank.

In the first half of 1961, the Bank sold or agreed to sell $119 million principal amount of loans, all without its guarantee. On June 30, 1961, total sales of loans, including portfolio holdings and par

51 Not reprinted here.

On July 1, 1961, the first issue of Italian lire bonds of the Bank was offered for public subscription in the Italian market. [Footnote in source text.]