The Director of Economic Operations in the Middle East to the President’s special assistant
Cairo, November 26, 1943
Dear Harry: Herewith is a memorandum that Averill asked me to prepare for you this morning.
I am grateful to you for your kindnesses to me this morning and for the opportunity that it gave me to put a few of the significant issues that we face in this area.
You know that at any time I am at yours and the Boss’s beck and call for anything.
Sincerely yours,
JAMES M. LANDIS
[Enclosure]
Memorandum by the Director of Economic Operations in the Middle East
Memorandum on consumer goods in Iran
Of course, it is impossible to obtain absolutely accurate figures in view of the lack of statistical information in Iran, but these figures I think represent the situation fairly accurately on consumer goods.
As of January 1, 1943, the total quantity of all consumer goods, not including cereals and other, bulk foodstuffs, in all Persian warehouses at the beginning of the year was 80,000 tons. Recent information indicates that between 15,000 to 18,000 tons are still at Persian Gulf ports alone. In an attached memorandum, I am breaking down the 80,000 tons of the various different categories. I can give you an even more detailed breakdown but I do not believe that this is necessary for your purposes.
The difficulty in Iran lies in the existence of an adequate distribution system and not in the absence of consumer goods. If you have time, go down to the central bazaars in Tehran and not only look at the goods that are available there in the shops but go in behind to the warehouses that are in the rear of these shops and see the masses of goods that are piled up there. Of course, the prices are quite beyond reach. Some economic theorists believe that it might be advisable to throw consumer goods into Iran in order to break these black-market prices. But the answer to that is that we have neither the tonnage nor the goods to create surpluses of such a size that black market prices would be permanently broken.
I might add a little about the truck situation. I think it is true that there are perhaps less trucks in Iran than there were in 1938, but not very many less. We are just compiling figures on this now. But the trucks that are in Iran are neither kept at jobs that are essential nor are they kept in repair. Of some 400 Lend-Lease trucks in Tehran I saw 83 of them in one yard alone that were laid up because of lack of repair facilities. Here again the trouble is not spare parts but the want of efficient management.
Attached herewith are data for specific items of consumer goods – the important ones being sugar, tea, drugs and cotton piece goods.
The following data is given for specific items:
(a) Sugar (October 30)
| UKCC Stocks | 6500 tons |
| Government Stocks | 24000 tons |
| Total | 30500 |
MESC has now programmed for Iran during 1944, 5000 tons per month.
(b) Tea (October 30)
Government Stocks 800 tons.
An additional 2,000 tons are to be imported during November and December, with a total 1944 program of 6,800 tons. This latter figure represents 90% of pre-war consumption.
(c) Coffee: Stocks unknown, but believed to be extremely small. The 1944 program is set for a total of 300 tons.
(d) Cocoa: None heretofore furnished by MESC. 1944 program includes 100 tons which is now available in Palestine for shipment at any time.
(e) Whiskey and gin: Stocks negligible since there was no quota for 1942-43. Present recommendations are for 1944 quota of 6,600 cases subject to approval by London and Washington.
(f) Drugs and pharmaceuticals: Lend-Lease Representative MacDonald estimates sufficient supply for one year, not including items now under procurement. In addition to stocks held by the Government, 85 tons of drugs and instruments have been held in ports for over a year.
(g) Cigarettes and tobacco: There are no imports of cigarettes since Iran is self-sufficient. At present they have on hand a nine months’ stock of unmanufactured cigarette tobacco, and a seven months’ stock of unmanufactured pipe tobacco.
(h) Cotton piecegoods: Estimated stocks on hand September 7: 21,263 bales exclusive of very considerable stocks held by private merchants, and the products of Iranian Government textile factories (which have held back from the distribution authorities more than 4,500 bales during the past eight months).
Estimated stocks of cotton piecegoods as at January 1, 1943 is 5,000 tons, of which 80% is probably Government.
(i) Woolen piecegoods: Iran is self-sufficient generally, but a quota of 80 tons has been assigned for 1944 in order to provide cheap clothing for low-paid Government servants. This, however, is subject to non-interference with minimum demands of other territories.
(j) Toothbrushes: Stocks believed to be extremely low.
(k) Bicycles: 500 were recently imported but are believed to have been sold to users, making a total of 22,616 in operation with no unsold stocks.
(l) Glassware and crockery: Reports indicate that “two warehouses are full” of glassware. Iran is self-sufficient in crockery and in fact has offered to export to other countries at high prices.