740.00112 European War 1939/9234: Telegram
The Ambassador in the United Kingdom (Winant) to the Secretary of State
[Received September 3—4:55 p.m.]
5833. From Riefler for Department and OEW. The Swiss Minister has now replied as follows to the letter quoted in my 5519 of August 22 about the recent increase in Swiss exports of arms and machinery to the Axis mentioned in the Department’s telegram 5249 of August 28, midnight.
“London, 1st September, 1943.
Dear Mr. Foot. Upon receipt of your letter of August 21st, in regard to Swiss exports during June and July last, I had not failed to inform the Swiss authorities of the contents of your communication, as well as of your desire to receive Bern’s comments in this matter. I am now in receipt of the following observations, which have apparently also been put before His Majesty’s and the United States representatives in the Commission Mixte, at a meeting held on August 25th.
[Page 870]1. From Bern’s explanations it would appear that the increases in June and July are at least partly due to a combination of technical reasons connected with the provisional clearing arrangements now in operation. As a matter of fact, the provisional arrangements which had been made when negotiations with Germany for a new war trade agreement broke down early this year, were for the time being limited to July 31st, so that the temporary facilities for so-called ‘old contracts’ applied only to goods actually despatched before July 31st. The knowledge of this, may thus have been leading certain exporters to hasten the delivery of contracts while facilities remained technically available. The Swiss authorities were therefore, to some extent at least, faced with consequences which it was difficult to foresee, resulting from the short term nature of these arrangements, which in turn are a consequence of the complications arising from the necessity of negotiating at the same time with both groups of belligerents.
2. As to the more general aspects of the situation, Bern are again drawing attention to our continued dependence on imports from Germany, as well as on the physical German control both of our imports and our exports. Through the above provisional arrangements, it has been possible to secure continued German supplies of coal, iron and potash, and to obtain important facilities in our exports to third countries. Both these achievements are of great importance to Switzerland, for the supply position as well as for the maintenance of employment. It is for these reasons that export restrictions could only be introduced gradually, and that it would have been difficult to take measures anticipating the actual enforcement of restrictions. Bern further point out that the restrictions which have now been put into force, were not taken without serious risks of reaction on the part of Germany.
3. Bern also beg to refer to the information given in April last (our memoranda of April 15th and 29th, 1943) on the liquidation of the old trade agreement as a counterpart to the resumption of the German coal deliveries, and on the possibility of certain temporary increases in Swiss exports to Germany. These prospects then led on the Allied part to the suspension of facilities as from the middle of April. However, contrary to the expectation at that time, exports to all Axis countries, as well as to Germany alone, actually remained until June below the monthly average of 1942. On the other hand, the following figures on exports from August 1st to August 23rd clearly show the effect of the restrictions which are now in force.
(Read in three columns separated by commas, first the Swiss tariff item, second July 1943, and third August 1st to 23rd, exports in millions of Swiss francs.) 809a1–a3, 2, .3; MDY, 2.7, .3; M6,16.8, 1.3; 948a, 4.9, 1.5.
Bern also wish to confirm that exports in July resulted almost exclusively from contracts placed before January 15th, 1943. This applies particularly to ball bearings (tariff item 809a1–a3).
4. As to group 11, where there has so far been no undertaking of definite restrictions, Bern refer to the peace time character of these manufactures. Exports under this group are considered of [Page 871] great importance for the maintenance of occupation, especially in view of the unavoidable effects of the restrictions now operating in other sectors. In this connection, attention is also drawn to the fact that a large majority of the Swiss industry refused to a very considerable extent German offers for war contracts, thus limiting themselves to their peace time activity. Thus, the Axis countries have had at no time the full advantage of Swiss productive capacity.
5. Finally, Bern are stressing the far-reaching effects of the restrictions enforced as from July 1st and August 1st respectively, which will mean a considerable slowing up in the execution of German orders. For a number of articles, such as radio equipment, ball bearings, etc., the effects will be particularly marked, in view of the heavy amount of orders placed.
While bringing the above to your knowledge, I remain of course at your entire disposal should any verbal discussion of the matter be desired. As you will easily understand, I am naturally most anxious to hear from you as to the further course in regard to the return of our Trade Delegation to London.
Believe me, dear Mr. Foot, yours sincerely, M. Thurnheer.[”]
Winant