Lend-Lease

Lend-Lease, programme of military and economic aid given by the United States to nations warring against the Axis powers during World War II. Despite the proclaimed neutrality of the United States, the US Congress empowered President Franklin D. Roosevelt, by the Lend-Lease Act of 1941, on behalf “of any country whose defense the President deems vital to the defense of the United States, to sell, transfer title to, exchange, lease, lend, or otherwise dispose of, to any such government any defense article” not expressly prohibited. The law originally authorized an appropriation of US$1 million. The Office of Lend-Lease Administration, established in October 1941 to administer the act, was incorporated into the Foreign Economic Agency; in 1943 the office was transferred to the Department of State.

In addition to the United Kingdom, China, and the USSR, 35 other governments received lend-lease aid. They included the Netherlands, Belgium, and the Free French. By the Reciprocal Aid Agreement signed with the United Kingdom, the Free French, Australia, and New Zealand—popularly known as reverse lend-lease—American troops stationed overseas received material assistance from the signatory nations. By August 1945, when the war ended, lend-lease appropriations totalled about US$48 billion—the majority of which went to the United Kingdom (approximately $US31 billion) and the USSR (approximately US$11 billion). The United States had received more than US$6 billion in reverse lend-lease. Arrangements for the repayments by the recipient nations, often in kind, such as the purchasing of US goods or rent-free military bases, were begun shortly after hostilities ceased. Except for the Soviet debt, of which less than one third was repaid, repayment was virtually complete by the late 1960s. The United States, in 1972, accepted an offer by the Soviet Union to pay US$722 million in instalments between then and 2001 to settle the indebtedness. This debt was inherited by the Russian Federation when the Soviet Union collapsed in 1991. Final repayment on the Lend-Lease loans to the United Kingdom was made in December 2006. See also Anglo-American Loan Agreement 1945.