740.0011 European War, 1939/239: Telegram

The Minister in Yugoslavia (Lane) to the Secretary of State

259. The following developments are in our opinion noteworthy in showing that Yugoslavia definitely does not expect to be on the German side and that Germany likewise considers Yugoslavia to be virtually on the other side.

A reliable official source confirmed today that the Yugoslav authorities have been holding up wheat and corn shipments to Germany [Page 421] because of German failure to make deliveries of Skoda armament according to contract. The informant stated that he fears the Germans would consider further Yugoslav refusal to make delivery “as an unfriendly act” intimating that the matter “would be settled this afternoon”.
The Standard Oil Company of New Jersey has been informed that it will be granted concession for petroleum exploration.
Although Germany is furnishing arms, ammunition and airplanes to Bulgaria nothing is being furnished to Yugoslavia.
The press this morning requests the public not to disseminate alarming rumors. No mention is made of specific rumors already circulated but it is believed that reference is made to rumor that general mobilization has begun and that there is danger of attack from Italy. Mobilization continues at fairly rapid rate and has now reached estimated strength of 500,000. Mobilization of active divisions of first, third and fourth armies is nearing completion, the first and the fourth armies have installed covering forces along the entire northern frontier from Rumania to the Adriatic.
Preliminary work on organization of additional reserve divisions is now in progress.
The Chief of Yugoslav Military Intelligence Division in an interview with our Military Attaché this morning stated that he felt there was increasing possibility of Poland being completely routed within 5 or 6 days and that following the defeat of Poland Yugoslavia might very readily be directly threatened, if not attacked. He could not understand why more effective action had not been taken by France and England to relieve the pressure on Poland and feared that any contemplated action would arrive too late. Furthermore he indicated quite clearly that Yugoslavia was taking every means possible to defend itself against a sudden attack.
The outward quiet and a noteworthy lack of information regarding the general situation belies a deep-seated nervousness on the part of the civilian population.