Our assistance to the highly strategic countries of Greece, Turkey, and Iran has helped them to maintain their independence against Soviet pressures and has contributed to strengthening their economy and military position. The conclusion of a military alliance by Greece, Turkey, and Yugoslavia is an outstanding example of regional friendship and a real contribution for the security of the area. The United States played an active part in long negotiations for settling the oil dispute between the United Kingdom and Iran. The operation of an international consortium will again bring Iranian oil to world markets and will give that country an opportunity to enter an era of social, economic, and military progress. I must caution, however, that until Iran's oil revenues are again normal we should be prepared to assist that country to play its important role in the Middle East area. The five countries of south Asia (India, Pakistan, Nepal, Ceylon, and Afghanistan), with over 450 million people and great natural resources, are of critical importance to the free world. The principal problem of the countries in south Asia is to bring about some perceptible increase in the very low living standards of their people through programs for development of their largely agricultural economies and of their possible industrial potential. United States economic and technical assistance has been directed to these objectives in India, Pakistan, Afghanistan, and Nepal. In these countries we have furthered dynamic programs of American assistance designed to help them raise living standards through democratic means and thereby to contribute to political stability. India, as the largest non-Communist power in Asia, continues to occupy a position of great influence in the world, making it important for us to develop those areas of mutual agreement where India's policy of nonalinement does not conflict with our policy of collective security. The differences between the United States and India's approach to various international problems make particularly important the work of our mission in India and require the maintenance of effective and adequately staffed diplomatic and consular establishments. The United States and Pakistan have steadily strengthened their ties of friendship. The United States program of military assistance for Pakistan has encouraged Pakistan's willingness to play an important role in defense of the Middle East and also in southeast Asia, as evidenced by its signing of the Manila Pact. However, Pakistan's contribution to the security of these areas will depend on the extent of its recovery from its present severe economic difficulties. Our Ambassador and his staff there have a vital role in assuring the effectiveness of our military assistance which is just getting underway and of our economic program aimed at putting Pakistan on a sounder footing. The recent sharp increase in Soviet interest in Afghanistan will require most careful consideration and possible adjustment of our policies toward that country in the coming year. The United States was able to help Pakistan in its unprecedented floods last year and gave similar help to the little Himalayan State of Nepal. Our relations with Ceylon are cordial, but both countries must continue to examine ways to resolve trade problems and to cement their friendly relationship. We have continued our policy of limited technical assistance in Africa, both in the independent countries of Ethiopia, Libya, and Liberia as well as the dependent territories. The development of agriculture has been stressed under technicalassistance programs in Africa and much emphasis has been put on the development of health and education facilities. In the case of Libya, we have undertaken to supplement our technical assistance with economic aid. This undertaking was made at the time we concluded a base-rights agreement with Libya. Perhaps the most difficult problems in the area are those in French North Africain Morocco and Tunisia. The Tunisian question is now the subject of direct negotiation between France and those immediately concerned. The United States still holds to the view that the road to progress lies within an orderly framework and is confident that the French Government is moving toward some constructive solutions of these problems. With reference to Colonial Africa, it is of primary importance that the United States continue to use its influence in the settling of the problems of that area. Many of our problems are new, some are old, others are intensified, and we are here to discuss with you gentlemen in detail what we believe is necessary to meet the problems of mutual defense arrangements, moderation of the anti-Western aspects of nationalism, mitigation of racial tensions, promotion of economic development as a means of strengthening the bonds which tie the uncommitted countries into a free world system, and the establishment of strength and stability in states such as India and Pakistan which can be counterweights to the influence of Soviet Russia and Communist China. Of the increase requested in this budget presentation, 34 percent is requested for the establishment of new posts in Aleppo, Syria; Brazzaville, French Equatorial Africa; Hyderabad, India; Abadan area, Iran; and Mombasa, Kenya. The political, economic, and consular problems of the areas surrounding these proposed posts are of such a degree that they can no longer be economically serviced from other far distant offices. 42 percent of the overall increase is for general strengthening of substantive and other activities in the area, and 15 percent is for the initiation of a trade commissioner program. Many functions necessary to the development of trade and investment have been only partially accomplished, and the American businessman, particularly, has been critical of the dearth of current information on economic developments and opportunities for trade and investment. The additional personnel which the budgeted funds will provide will render those services which the business community needs and which cannot otherwise be afforded. The additional trade commissioners which are requested will be assigned to important world commercial centers to provide advice and assistance to American and foreign businessmen. They will develop opportunities for trade and investment and work for the elimination of obstacles and discrimination against United States commercial interests. In conclusion I would like to refer to the Department's educational exchange program. Since the program began, at posts where I have served, it has proved a highly effective means of creating understanding and good will between ourselves and other countries. In my present area the program has hitherto been pitifully small in relation to other parts of the world. A 50 percent increase is proposed in 1956 as a significant step in raising the volume of exchanges to a level justified by the size of the area, its critical importance to us, and the variety of needs and opportunities that exist within it. The program can be an invaluable instrument for strengthening Western influence, creating a will toward cooperation, and promoting political stability throughout the area. It will afford to present and rising leaders intense personal experience that will equip them with needed knowledge and skills, and at the same time offset tendencies toward extreme nationalism, antiforeignism, or neutralism. The vital importance of this program cannot be overestimated. AREA OF RESPONSIBILITY Mr. ALLEN. Mr. Chairman, the area with which we are concerned is Africa, except Algeria and in the Union of South Africa; the Near East, which means the Arab countries and Israel; Greece, Turkey, and Iran; and Afghanistan, Pakistan, India, and Ceylon. Senator KILGORE. Saudi Arabia? Mr. ALLEN. Yes. Senator KILGORE. You say Iran? Mr. ALLEN. Iran, Afghanistan, Pakistan, India, and Ceylon. Mr. ALLEN. Yes, sir. Senator KILGORE. Bhutan? Mr. ALLEN. Bhutan, and Sikkim, which is another entity not named on your map. There are 91 separate governments in this area, including independent countries, protectorates, and colonies. It includes roughly 30 percent of the area of the world and about 30 percent of the world's population. Perhaps, without being guilty of localitis and overemphasizing the particular area with which I am concerned, I should point out that relatively, American interests in this particular area have been growing more rapidly during the last few years than any other. Our activities and interests there were small until after the last war. AMERICAN OIL INVESTMENT Today, the largest single American financial investment in the world, outside of the United States, is the American oil investment on the Persian Gulf. The area we are discussing is strategically important because it is the only area bordering on Soviet Russia which has not been satellited, since all of Eastern Europe and the mainland of China are now Communist territory. This is the only non-European area where the Soviet policy of satellization of its neighbors which was established in 1917, has not succeeded. This means we must keep our attention very closely on this part of the map. FUNDS FOR NEW CONSULAR POSTS Mr. ALLEN. The additional amounts which we are requesting this year are primarily for the opening of five new consular posts in the area. We are asking only for two additional positions in Washington, a labor advisor in my office and a secretary. We propose 54 additional Americans abroad and 64 locals, making a total of 122 additions. I think it might be interesting to you, sir, to break down these additions. For additional trade development work, which has been mentioned so many times in these hearings, there is a total of 27 Americans and 19 foreigners. In the 5 new posts to be opened, there are 21 Americans and 45 locals. Except for the 5 new posts to be opened and the additional trade development work, we are asking for this entire area of Africa, the Near and Middle East, India, Pakistan, and Ceylon, for no additional local employees and only 10 additional American employees, in spite of the fact that the American interests in the area, I repeat, percentagewise, are growing more rapidly perhaps than any other in the world. In this area we have to run fast to stand still, that is, to keep from lagging behind the growth of American interests. The new posts which we plan to open are at Aleppo, Mombasa, Hyderabad, Khorramshahr, and Brazzaville. Those are all in areas where we have had no coverage before either for reporting or for protection of American interests. We feel it is extremely important to open those posts. Some of these names sound rather odd. For example, you may wonder why we have to have a consulate at Khorramshahr. In October, American oil companies took a 40-percent interest in the Iranian oil consortium. Today, as a matter of fact, is the last day for the entry into the consortium of 10 new American oil companies which have never operated in the Persian Gulf before. Half of the crude petroleum resources of the world are located there. That explains why we need a consulate in a little place like Khorramshahr, which very few Americans ever heard of. Senator KILGORE. Have you anything further? Mr. ALLEN. That is all, unless you have questions. Senator KILGORE. Have you any questions, Senator Green? Senator KILGORE. Thank you very much. OFFICE OF PERSONNEL STATEMENTS OF GEORGE F. WILSON, ASSISTANT CONTROLLER FOR PERSONNEL; LOY W. HENDERSON, DEPUTY UNDER SECRETARY FOR ADMINISTRATION; HAROLD B. HOSKINS, DIRECTOR, FOREIGN SERVICE INSTITUTE; AND EDWARD B. WILBER, BUDGET OFFICER, DEPARTMENT OF STATE COMPTROLLER'S OFFICE Mr. WILBER. Mr. Chairman, the next item where we have a rather ubstantial reduction which we are asking to have restored is in the Comptroller's Office in the Office of Personnel. We have Mr. Wilson, the Director of that Office, here to testify on this item, as well as Mr. Hoskins, the new head of our Foreign Service Institute, so they will both testify on portions of this item. Senator KILGORE. All right, you may go ahead. Mr. WILSON. Thank you, sir. Mr. Chairman, our 1956 budget reflects certain personnel policies which have been adopted as a result of the Secretary's public committee on personnel, which met last year. The implementation of these programs was initiated in August of 1954, and considerable progress has been made since that time. PREPARED STATEMENT With the committee's permission I would like to file a statement outlining the progress and give a brief summary of the statement. Senator KILGORE. Go right ahead. (The statement referred to follows:) STATEMENT OF GEORGE F. WILSON ASSISTANT CONTROLLER FOR PERSONNEL ACTION ON WRISTON COMMITTEE RECOMMENDATIONS The In March 1954, the Secretary appointed a Public Committee on Personnel to recommend measures to strengthen the effectiveness of the Department and the Foreign Service. The Committee, headed by Dr. Henry M. Wriston, president of Brown University, submitted its report to the Secretary in May 1954. report contained some 79 specific recommendations, all but one of which were approved by the Secretary although in some instances with minior modifications. Sixty-five of the approved recommendations related to better personnel management and other administrative improvements. The remaining recommendations were concerned with improved public confidence and morale. The Department has made considerable progress in carrying out the recommendations of the Secretary's Public Committee. Of the 65 approved recommendations concerned with improved personnel management and general administration, 35 have been implemented. The remaining 30 recommendations, with one exception, are in process of being implemented. A brief statement of accomplishment in conformance with these recommendations follows. UNIFYING AND SIMPLIFYING THE DEPARTMENT'S PERSONNEL STRUCTURE The Committee's most fundamental recommendation was to expand the Foreign Service officer corps to include, in addition to the present Foreign Service officers, those civil service officers in the Department and those Foreign Service Reserve and Foreign Service staff officers engaged in essentially the same kind of work, This will not increase the number of employees; it involves a change for certain officers of the Department from the civil service, or the Foreign Service staff or Reserve corps, to the Foreign Service officer corps. This process, commonly referred to as the "integration program," was launched last August. To provide a basis for this program, a review was made of all officer positions in the Department and at overseas posts to identify those that should be staffed by rotation of officers between home office and overseas assignments. As a result of this review, some 1,500 departmental positions and about 2,300 overseas positions have been designated for eventual staffing by Foreign Service officers. Legislative authority was obtained from the 83d Congress to appoint Foreign Service officers in classes 1 through 5 above the minimum salary rate (Public Law 759, 83d Cong.). Such authority was essential if the program was to succeed. This legislation limited the number of such appointments to 500 through March 31, 1955. The Department has completed the first phase of the integration program pursuant to this legislation. Five hundred and seventy officers have been confirmed by the Senate for appointment as Foreign Service officers, of these 411 have been confirmed for appointment at rates above the minimum salary for classes 1 through 5. This has involved the review by examining panels of the records of about 1,500 candidates, all of whom have received security clearance under Executive Order 10,450. In addition to the 569 candidates confirmed for appointment by the Senate, 34 officers have been approved for appointment as Foreign Service Reserve officers; 564 officers have been found to be ineligible, disapproved for physical or other reasons, or have declined offers of appointment. About 330 cases are in various stages of the examination process. Public Law 22, 84th Congress, effective April 5, 1955, authorizes an additional 1,250 lateral entry appointments which is sufficient to complete the integration program. The Department is developing revised regulations pursuant to the new legislation and shortly will resume operations. A considerable number of officers in Foreign Service positions are unwilling or unable to accept integration. These officers will continue to be employed in useful and productive work in the Department. However, as attrition occurs, every effort will be made to fill vacancies with Foreign Service officers. Steps have been taken to assure that possible inequities affecting present Foreign Service officers will receive careful attention by selection boards in considering such officers for promotion. Following an agreement with the Civil Service Commission, the established qualifications standards for some 1,500 civil-service positions have been modified by the Department to require appropriate overseas experience, or the willingness to acquire such experience through accepting an appointment as a Foreign Service officer. A personnel inventory system involving current information concerning the qualifications of individual officers and the requirements of individual Foreign Service positions has been installed as the first essential to an improved assignment rotation and officer-development program. Although this of necessity is a continuing program, the results of which cannot be assessed for some time, certain improvements are occurring. For example, as former departmental officers are assigned overseas, other Foreign Service officers with long overseas service are being returned to Washington assignments. Such interchange of personnel is occurring at an increasing rate and will be of mutual advantage to the Department, the Foreign Service, and the officers concerned. In making each such assignment, increased weight is being given to the interest and ability of the officer involved so that there may be a better matching of individuals and positions. The Foreign Service promotion and selection out system has been revised to accommodate the expanded Foreign Service officer corps. It provides increased recognition for those officers who render extraordina.ily meritorious service. It likewise provides for the positive identification of those officers who fail to maintain the performance standards established for their class. IMPROVING RECRUITMENT OF FOREIGN SERVICE OFFICERS The Secretary's Public Committee on Personnel emphasized the desirability of improving the recruitment and examining program for class 6—the entering level— Foreign Service officers. Immediate action was directed by the Secretary, and substantial progress has already been made. During the past 3 months, responsible Department and Foreign Service officers have visited about 225 colleges and universities, in every State of the Union, to present the new career opportunities in the Foreign Service. Over 2,300 young men and women from all parts of the country and all walks of life have already applied to take the Foreign Service examination on June 24. The groundwork has also been laid for a continuing future program of sound college relationships. Numerous steps have been taken to modernize the Foreign Service examination so that it will reflect the latest proven examining techniques. The new examina |