Page:Pentagon-Papers-Part-V-B-3c.djvu/221

 covering landlord-tenant relationships, conditions of land tenure, and an emergency program whereby refugees and military personnel demobilized as a result of the reduction in the Armed Force can be placed upon land abandoned by its owners not now in use. The program will provide that after three years, if certain conditions are met, the refugees can obtain permanent possession of the land on which they are placed.

. Vietnamese experts have drafted, and with the close cooperation of members of the Embassy staff, revised a decree establishing a national assembly. This assembly will be provisional, will have some elective character, and will have only limited powers. This assembly will prepare for the later establishment of a constituent assembly but will itself have no constituent powers. This point is important since to establish the permanent form of the government necessarily involves defining the role of the present Chief of State Bao Dai. The inclination of the present government is to throw over Bao Dai, but I feel that as long as the national government is unable to cone with the sects and other splinter groups without his aid, it would be both premature and dangerous to remove Bao Dai from his position as Chief of State.

. . (1) Vietnam now has its own national bank and is independent of the previous quadripartite system. American experts of the USOM and Embassy staffs are working with Vietnamese Government officials to establish procedures acceptable to the United States with regard to foreign exchange, import controls, and related matters. Much time has been consumed in explaining American requirements but the Vietnamese officials have displayed good will and I believe that they will meet our objectives in this regard.

(2) During CY 1955, tax receipts of the national government of Vietnam will be approximately $139 million, of which $116 million will have to be used for ordinary civilian expenditures of the government. This surplus on the civilian side of the budget, plus borrowing and other extraordinary receipts of the national government, will permit the Vietnamese Government to contribute approximately $68 million to the extraordinary expenditures of the Government, including military, refugees, and economic aid. The balance of necessary expenditures of approximately $327 million will have to be met by United States aid. For FY 1956 it is estimated that receipts will increase and expenditures decline, so that aid needed will decline to approximately $258 million. Rh