661.6231/297: Telegram

The Ambassador in the Soviet Union (Steinhardt) to the Secretary of State

13. My 1768, December 23, 1 p.m.97 A member of the German Embassy explains the delay in the announcement of Soviet-German economic agreement as follows: the main economic agreement dealing with the exchange of goods between the Soviet Union and Germany, he states, was entirely completed and could have been signed as scheduled on December 23, but since the supplementary agreement relating [Page 117] to the compensation for German and German-Balt property in the Baltic States98 as well as certain questions relating to former German trade with those areas was nearly completed it had been hoped that the two agreements could be announced and signed simultaneously but certain difficulties arose in connection with the Baltic agreement which, as previously reported, required submission to Berlin and it was, therefore, decided to delay the announcement of the main economic agreement until these difficulties have been resolved. My informant stated categorically that the difficulties related only to the Baltic agreement and that it would be possible at any time to sign and announce the major economic accord which will be known as the agreement “of the second period” and will run until May 1942. The principal feature of the new agreement, as previously reported, will provide for an increase of Soviet grain and fodder deliveries to Germany to a total amount of 2,500,000 tons a year. According to my informant who is confirmed by Schnurre99 it is hoped that the final details of the Baltic agreement will be completed within a week. In such event the two agreements will be announced simultaneously.

  1. Ibid., p. 589.
  2. With regard to Soviet offers of adequate compensation for property nationalized in the Baltic States and negotiations for a satisfactory agreement with Germany, see telegram No. 1709, December 11, 1940, and telegram No. 1731, December 14, 1940, from the Ambassador in the Soviet Union, Foreign Relations, 1940, vol. i, pp. 588 and 442, respectively.
  3. Karl Schnurre, head of the Eastern European and Baltic Section of the Commercial Policy Division of the German Foreign Office.