File No. 103.96/106

The Special Representative of the War Trade Board ( McCormick ) to the Secretary of State

[Telegram]

Our 23. For War Trade Board from McCormick:

Mr. Balfour has just reached here from the Foreign Office and submitted to us the following:

The increasing difficulties with neutral powers contiguous to the enemy are causing His Majesty’s Government gravest concern. Our information is that there is serious unrest even in Norway and the position in Denmark, Sweden and Holland is scarcely better than the Swiss situation with which you are familiar. We cannot, in view of the difficulty of coming to a definite arrangement with the authorities in Washington, even induce the Americans to put forward definite demands as regards these countries although all supplies to them have been cut off. In the cases of Sweden and Holland the danger is especially serious: that danger is that Sweden and Holland will practically pass into a state of complete economic subjection to Germany since they will be forced to make with her the best terms that they can while the very precursory [with very prejudicial] effect upon our export. The cessation of all exports except coal from the United Kingdom is a lesser evil though one by no means to be left out of account.

Taylor and I recommend, approved by House, that, due to the Russian difficulties and general situation here, it is most important to come to a speedy settlement with all of the northern neutrals as soon as possible. We understand Norway and Denmark about concluded. Please confirm. We urge the making of definite proposal to Holland at the earliest possible moment and also Sweden. In regard to latter, the Allies and ourselves feel that we cannot bring about a complete cessation of export of iron ore to Germany and that we should therefore negotiate for the greatest possible reduction. Please advise the present status Holland and Swedish negotiations for our information. After frequent conferences with the British, the French, and the Italian representatives, we have agreed upon the Swiss proposal and expect to confer with the Swiss delegates to-day and will take some time to come to a settlement.

McCormick