File No. 658.119/1
The British Embassy to the Department of State
Memorandum
In the memorandum, dated May 7,1 in which was explained the situation as regards each neutral European country in war trade matters, it was suggested that the Government of the United States should only license exports to Sweden in return for equivalent compensation [Page 1020] from Sweden in the form either of exports to the Allies or of transit facilities to Russia. It was further suggested that it should be made clear that such compensation should be in addition to the compensation already provided for in the draft agreement between the British and Swedish Governments, the ratification of which by the Swedish Government should, it was proposed, form part of the demands to be put forward by the Government of the United States.
In view of changed circumstances, the British Government now doubt whether the final conclusion of this draft agreement would be advantageous. While, therefore, the suggestions made in the memorandum of May 7 still represent the wishes of the British Government in all other particulars, that Government would now prefer that the United States Government should not press for the ratification of the draft agreement but should simply stipulate, in negotiating for compensation with the Swedish Government, that such compensation should be in addition to similar compensation granted or to be granted in exchange for exports or services obtained from Great Britain or her allies.