611.59A31/62
Memorandum of Conversation, by Mr. Hugh S. Cumming, Jr., of the Division of European Affairs
Mr. Thor and Mr. Asgeirsson called at Mr. Berle’s office at the latter’s request at 4 o’clock this afternoon. Mr. dimming was present during the conversation which ensued.
Mr. Berle referred to his conversation with the members of the Icelandic Government Trade Delegation some days ago during which he had informed them of the substance of the representations which he had made to the British Embassy on behalf of the United States regarding United States views as to the alterations which should take place in British-Icelandic trade and fiscal relations in order to clear the way for fulfillment by the United States of the broad obligations which it has assumed towards Iceland. Mr. Berle then read to Mr. Thor Mr. Wyndham White’s memorandum numbered I15 which he delivered to the Department on October 20. Mr. Thor listened attentively and expressed himself as being satisfied with the British memorandum with the exception of the statement that the British Government desired the Icelandic Government to admit their obligation [Page 769] to resell foreign exchange to cover some two million Canadian and United States dollars advanced to Iceland by Great Britain last summer. Mr. Berle pointed out that while the British Government had not fully acceded to his suggestion that the British entirely relieve Iceland of the obligation to repay this exchange, they had, according to the memorandum, in writing given an undertaking to the United States Government that they would not press the Icelanders to resell this exchange until Iceland should have accumulated substantial dollar balances; this therefore was an undertaking by the British Government to the United States and left the way open for the matter to be taken up again by the United States with the British when necessity therefor should arise. Some discussion took place at this point during which Mr. Berle emphasized that in his opinion the British had gone such a long way towards meeting the views of the United States and Iceland that the Icelandic Government might consider it wise to accept the British view in this respect for the time being.
In this last connection Mr. Berle, while reiterating his statement that it might be well to let further discussion of the point remain in abeyance until Iceland should have accumulated large dollar balances and the British should have made a claim against these balances for the two million dollars of exchange advanced Iceland by them, made the further personal suggestion that at some point the Icelandic Government might wish to consider offering to the British Government to utilize two million dollars’ worth of United States exchange for the purchase of the Icelandic debts outstanding in Britain.
Mr. Berle then read to Mr. Thor, Mr. Wyndham White’s memoranrum numbered II,16 cautioning Mr. Thor that this memorandum should be considered confidential since it contained proposals which the British Government had not yet made to Iceland but was only considering making. He added that the Department had informed the British Embassy that in its opinion the proposals made in the two memoranda left by Mr. White were fair and reasonable and that the Department would recommend that the Icelandic Government accept them as the basis for further negotiations between Iceland and the United Kingdom with respect to their fiscal relations.
With respect to sub-paragraph (f) in Mr. White’s memorandum numbered II, Mr. Gumming said that he had been informed by Mr. White and by Mr. Kenneth Bewley, of the British Supply Council, that in their personal opinion the British Government might have had in mind not an undertaking by the Icelandic Government to sell the British unlimited kronur “at present rate” but an undertaking to sell [Page 770] to the British against sterling at whatever rate might be current at time of purchase of the kronur needed for the use of the British troops in Iceland.
Mr. Thor was somewhat doubtful as to the validity of the opinion expressed by Mr. White and Mr. Bewley and said that his knowledge of the course of Icelandic-British negotiations led him to believe that the British meant exactly what they said in the memorandum.
After further general discussion and expressions of appreciation by both Mr. Thor and Mr. Asgeirsson on behalf of their Government of the aid which had been given them by the United States, the meeting broke up.