740.00111A Combat Areas/113
Memorandum of Conversation, by the Under Secretary of State (Welles)
The British Ambassador called to see me this morning.
The Ambassador said that he had two matters which he wished to take up with me. The first, he said, was an instruction he had received from his Government to inform me, for the moment unofficially, that the British Admiralty was working out a plan as a result of which the British Navy in the future would refrain from taking American merchant vessels for inspection into ports within the combat area. The Admiralty at first, he said, had intended to designate Halifax as the port to which American ships, the cargoes of which the British desired to inspect, would be taken, but inasmuch as Halifax was within the combat area, the Admiralty was now settling upon either St. Johns, Newfoundland, or another port the name of which the Ambassador thought was Yarmouth and which he believed was in New Brunswick. The Ambassador said that navicerted ships would of course be examined on the high seas and that only ships whose cargoes had not been navicerted would be taken for inspection to the two ports he had in mind.
The Ambassador was also instructed to inform this Government that the British Government had informed the Government of Finland that surplus agricultural products, et cetera, which the Government [Page 5] of Finland would be enabled to buy through the credits facilitated by the Federal Loan Agency, would be purchased by the British Government to the extent at least to which the British Government required such supplies. The Government of Finland had first been informed that payment would be made by the British Government in sterling, but as a result of discussions which had proved that the British Government could not spare the munitions which Finland desired from its own stocks, the British Government had later informed Finland that payment would be made in dollars so as to make it possible for Finland to purchase the munitions it required in the United States. The Ambassador added that Great Britain had already sent to Finland 70 airplanes and a considerable amount of anti-aircraft artillery, et cetera, but that it was not in a position to send more because of the constantly increasing demands being made upon Great Britain by her own allies, notably Turkey and Portugal.