740.00112 European War 1939/9035: Telegram
The Secretary of State to the Ambassador in the United Kingdom (Winant)
4943. For Economic Warfare Division. Your 5105, August 5. Department and Office of Economic Warfare agree that Swiss reply is substantially satisfactory. However, we agree with the points made by the Legation in Bern in its cable of August 251 that the formulae suggested for tariff items MDY, M9, 956a/f, 811/13, 1083 and 1084 are not thoroughly satisfactory.
Nevertheless, we agree in principle with the reply which you and Foot propose to convey to the Swiss Minister, but would like to suggest the following changes if you are in accord:
- 1.
- We might state that we assume that in mentioning tariff items M9 and 956a/f together the Swiss did not mean they would amalgamate the ceilings so as to make exports of these materials interchangeable.
- 2.
- You should make clear what is meant by reopening of half of the food quotas. Is it your intention to select half of the quotas to be restored or all of the quotas at half their regular level? We suggest the latter unless you have strong reasons for preferring the other.
- 3.
- The offer to make oats available should now be made conditional upon Swiss performance of their offer on dairy products. In this case we would be merely accepting a proposal made by the Swiss on their own initiative.
- 4.
- It should be made clear that our acceptance of these terms is not to be taken as meaning that we are satisfied with the results. It should be understood by the Swiss that all of these points are subject to further review in the London negotiations.
- 5.
- We think it important to make clear that Point 1(b) in your proposed reply regarding the supplies of Swiss francs is not a new demand on our part but merely a requirement that recent difficulties experienced by the British will not be allowed to recur. Our confusion on this point arises because of the difference in wording in your 5105 and the wording of paragraph 2(b) in MEW’s 3123 to the British Embassy in Washington.
- 6.
- We cannot see the reason for specifically mentioning our intention to resume pressure on arms and machinery firms particularly since we have not yet before us for consideration Bern’s reply to our telegram of Aug. 752 requesting their views. It does not appear that we are obliged to inform the Swiss of our intention in this regard and [Page 863] even should it be desirable at a later date it might be unnecessarily irritating to mention this at present. The concession to refrain from pressure was made previously only to enable the Swiss to obtain necessary German cooperation in providing export facilities under the compensation agreement. By announcing in the present context our intention to resume pressure we confront the Swiss before their return to London with a disagreeable prospect which the Germans may utilize to advantage in their negotiations with the Swiss.
- 7.
- In our opinion, it seems inadvisable to give the Swiss so uncertain an answer on the return of their trade delegation to London. If it is your intention to take advantage of the improving situation in the Mediterranean to increase our bargaining power, it would seem that since the Swiss will be in London for some time, their arrival a few days earlier would not prevent us from capitalizing on the favorable turn of events. We suggest, therefore, that your point 6 be modified to acquiesce in the return of the delegation immediately.
Report action. Repeat to Berne together with the substance of that portion of your 5105 beginning with the words “Begin Proposal”.