740.00112 European War 1939/8627: Telegram
The Ambassador in the United Kingdom (Winant) to the Secretary of State
[Received June 4—1:14 p.m.]
3805. For Department and Stone, BEW, from Riefler, Canfield and Cumming. At policy committee meeting June 3rd the following tentative compromise, broadly outlined, on our principal demands to the Swedes was reached:
Regarding 1943 exports to enemy Europe Hägglöf, in addition to limitations reported in our telegram 3768, June 2,67 agreed to keep exports within group 18 to the value of such exports in 1942. He also agreed to limitations on exports in the last 6 months of 1943 to the extent of five twelfths of the value of exports in 1942 on such rubrics as 221, 438, 450, 457. On wood pulps for the current year he agreed to an overall limitation of 425,000 tons of which rayon pulp would comprise 250,000 tons. With regard to certain other rubrics like 552:1 and 2, 523 and 524, we understand there will be a limitation to existing commitments which provide for exports of specific quantities. (This latter limitation will have to be confirmed.)
[Page 777]Regarding 1944, Hägglöf agreed to an overall value limitation on exports to enemy Europe of 700 million kronor and a limitation on groups 6, 9, 10, 15, 16A, 17B, 18 to 75 percent of the value of the exports within said groups in 1942. Other groups are either relatively unimportant or substantially covered by list A or other export prohibitions.
Regarding rubrics and combinations of rubrics, Hägglöf agreed for 1944 to most of the limitations we had proposed as a compromise on key commodities.
[Here follows proposed limitations by value on a list of commodities identified by rubric number.]
Aside from Swedish concessions already reported, a generally satisfactory agreement can be expected regarding prohibition of exports of arms, ammunition, ships and other means of transport, additions to list A, processing, barter and metal clearing, inverted procedure, abolition of list B, consignee control on shipments to Argentine, and credits with the exception of Finland.
Regarding Finland, Swedes will limit credits for the last half of 1943 to 12,000,000 kronor, plus Treasury bills amounting to 8,000,000 kronor, of which 50% are guaranteed. (Acceptance by Swedes of Finnish Treasury bills in above amount is required by commitments, already entered into.) As from January 1, 1944, the limit upon all new credits to Finland will be 15,000,000 kronor. No new tripartite arrangements involving Denmark and Finland will be entered into.
As to iron ore, although the Swedes state that existing commitments prevent them from agreeing to a definite limitation for 1943 we have already reported in Embassy’s 3697 of May 29 regarding two possible courses of action proposed by the Swedish delegation which, as a practical matter, should bring about a reduction in the quantities of Swedish iron ore received by enemy Europe during 1943. Because of the secrecy which must be observed with regard to these proposals, we consider it unwise to repeat them in this telegram.
For 1944 the Swedish delegation has finally agreed to the ratio of not more than 2 tons of iron ore exported to 1 ton of coal or coke imported, and to an upper limit of 7,500,000 tons.
Swedes are willing to accept principles that general agreement will be binding, whether or not Gothenburg traffic remains open, and that proper adjustments in ceilings shall be made if any country in enemy Europe ceases to be enemy or enemy-occupied territory.
Hägglöf hopes that the general lines of an agreement as set forth above will be confirmed by his Government, but has firmly stated that in agreeing to some of the foregoing points, even though ad referendum, he has stretched his instructions almost to the breaking point. He has also emphasized that above limitations on Swedish exports [Page 778] will cause unemployment and other forms of economic dislocation.
We feel that with due regard to existing Swedish commitments which have been thoroughly discussed, and to the general difficulties inherent in a negotiation of the kind, we have obtained substantial concessions and have arrived at the basis for an agreement possibly more binding and comprehensive than any agreement yet concluded with a neutral.
There are, of course, still points to be pressed, but on the other hand policy committee has not yet discussed basic rations in any detail. With regard to basic rations, we expect that we shall have to take a generous attitude and, subject to your approval, meet the Swedes as far as possible.
Further discussions on transit and agreement on this question are held up until instructions are received from Washington regarding Swedish request for permission to pick up 120,000 tons of oil between January 1st and October 1st, and regarding Swedish request for an extra tanker. We hope that everything possible can be done to make the answer on these points a favorable one, in view of the concessions offered by the Swedes and of their general attitude of cooperation.
We will telegraph in greater detail shortly regarding tentative compromise arrangements with the Swedes covering all our demands. May we point out that to press a number of new points of detail from now on, after the exhaustive discussions which have taken place with the Swedes, would be bound to create difficulties and possibly jeopardize final acceptance of the points already generally agreed upon. [Riefler, Canfield, and Cumming.]
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