Your message on the Istria-Trieste area reached me on May 21. A little earlier I received from you, through Mr Kennan, the text of a message on the same subject,
transmitted by the
U.S. Ambassador in Belgrade to the Yugoslav Government. Thank you for the information.

My views on the substance of the matter are as follows.

I think you are quite correct in saying that the matter is one of principle and that in relation to the Istria-Trieste territory no action should be permitted that does not take full account of Yugoslavia's rightful claims and of the contribution made by the Yugoslav armed forces to the common Allied cause in fighting against Hitler Germany. It goes without saying that the future of that territory, the population of which is mostly Yugoslav, will have to be determined at the peace settlement. However, the point at issue at the moment is its temporary military occupation. In this respect account should be taken, I believe, of the fact that it was the allied Yugoslav troops who drove the German invaders out of the Istria-Trieste territory thereby rendering an important service to the common Allied cause. By virtue of this circumstance alone, it would be unfair and would be a gratuitous insult to the Yugoslav Army and people to deny Yugoslavia the right to occupy a territory won from the enemy, after their great sacrifice in the struggle for the national rights of Yugoslavia and for the common cause of the United Nations. The right solution of this problem, in my view, would be for the Yugoslav troops and administration now functioning in the Istria-Trieste area to stay there. At the same time the area should be placed under the control of the Allied Supreme Commander and a demarcation line established by mutual agreement between Field Marshal Alexander and Marshal Tito. If these proposals were accepted the problem of administration in the Istria-Trieste area would likewise find the right solution.

And since Yugoslavs are a majority in the territory and even during the German occupation a local Yugoslav administration, now enjoying the trust of the local population, began to function there, these things should be taken into account. The problem of administrative government of the territory could be properly solved by subordinating the existing Yugoslav civil administration to the Yugoslav Military Command. I do hope that the misunderstandings over the status of the Istria-Trieste region, which have arisen between the U.S. and British Governments, on the one hand, and the Yugoslav Government, on the other, will be removed and a happy solution found.

May 22, 1945