Memorandum by the Chief of the Division of Northern European Affairs (Cumming)5

The British Embassy has made available to us the following information regarding the Soviet-Finnish negotiations:

The Swedish Government considers that the Soviet terms regarding treatment of German troops and the indemnity to be paid by Finland to be impossible of fulfillment and therefore the Swedish Government cannot recommend Finnish acceptance of the Soviet offer.
The British Government has expressed to the Soviet Government the view that it would be regrettable if the indemnity provision were to cause a breakdown of the present negotiations and has inquired whether in order to bring about a settlement the Soviet Government would if necessary be prepared to reduce the indemnity figure which [Page 589] now stands at $600,000,000 worth of goods spread over five years (this amount will cover at least 75 percent and possibly 100 percent of the total value of Finnish exports during the five-year period).
The British Government has given the Soviet Government an intimation of its concern lest the Soviet demand for goods from Finland interfere with the supply to Britain of timber, wood pulp and paper which Britain will badly need both during the war and the reconstruction period.
The British Government has reserved certain points with respect to British interests in Finland particularly its expectation that compensation will be paid to the British owners of the nickel mine in the Petsamo region should the territory in which this mine is located be ceded by Finland to the Soviet Union.

Hugh S. Cumming, Jr.
  1. Addressed to the Director of the Office of European Affairs (Dunn) and to the Secretary of State.