860D.51/439: Telegram
The Minister in Finland (Schoenfeld) to the Secretary of State
[Received March 15—12:55 p.m.]
150. Acting Director of the Bank of Finland11 told me last night that in addition to financial needs arising out of resettlement of people evacuated from ceded areas and general reconstruction, Finnish Government must contemplate heavy increase in armament within period of a year. He inquired whether credit recently granted by Export-Import Bank could be used for acquisition of armament now that Finland is at peace. I said I doubted that these funds could be so used but suggested that inquiry be made in Washington.
When I suggested in conversation recently with German Minister that great development might be anticipated in Finnish military preparedness as result of present situation he expressed the view that day of small nations situated within orbit of great powers was past and that supposed justification for their social, political and economic independence was merely an illusory relic of the era of liberalism. He thought that since cooperation between Russia and Germany was henceforth to be permanent the entire Baltic area must remain within their sphere of influence implying that small states in this area could be a factor of equilibrium only in the event of renewed rivalry between Germany and Russia which he did not expect.
- Jukka (Johan) W. Rangell.↩