740.00112 European War 1039/11019: Telegram
The Secretary of State to the Ambassador in the United Kingdom ( Winant )
4839. From Department and FEA for Lovitt. Your 4774 of June 14 repeated to Bern, and Bern’s 3814 and 3835 of June 15 and 3847 of June 1659 repeated to London as 1023, 1031 and 1032.
After consideration and discussion with Riefler of reference telegrams, Department and FEA wish to comment as follows:
- We agree that a threat of blacklisting formulated in the terms outlined in your 4774 may prove a powerful inducement to the Swiss to make us a more favorable offer. Bern is hereby authorized to make the proposed representations to the Swiss provided; (a) that you and MEW inform Bern that you consider such action desirable despite informal Swiss offer reported in Bern’s 3835; and (b) that the two missions in Bern be given discretion to refrain from action if they deem it inadvisable on the basis of the attitude of the Swiss in Bern toward the negotiations.
- If as now appears most probable, negotiations cannot be concluded or a definite offer received from the Swiss in time for final action before June 30, we wish to receive your views and those of our Legation in Bern regarding desirability of informing the Swiss before end of June that in view of their reluctance to make more effective reductions in their exports to enemy we are unwilling to conclude agreement for last 6 months at present time; that pending receipt of more satisfactory proposals and conclusion of an agreement, we would reserve all rights to undertake listing action; that during this interim period we should expect Swiss to keep their exports to enemy at minimum levels, not in any event to exceed most favorable level proposed by them to date; that in consideration of such limitation, we would be prepared to continue, on interim basis, the present quotas on food, fodder, and tobacco; and that when negotiations are concluded on a more comprehensive basis additional concessions on both sides will be retroactive so far as feasible to July 1st.
- As regards Swiss question on proposed global ceiling for group 4 (paragraph 3(a) of Bern’s 3835) Riefler has informed us that counter proposal made to Swiss on May 25 envisaged two global ceilings, one for Germany and the other for other Axis countries. If MEW agrees please confirm this interpretation to Bern for transmission to Swiss.
- We do not expect to request any further tranches in the Compensation Deal. We request that Bern, in informing the Swiss of this fact, endeavor to use this fact as a lever to obtain additional concessions from the Swiss, emphasizing Swiss argument that export reductions would be more acceptable to Germans if they did not ask for other concessions.
- After preliminary consideration of Swiss offer we do not
believe it constitutes an attractive compromise between the
original Swiss proposal of March 23 and our counter suggestion
of May 25. Before informing Bern of our final views, however, we
would like to have additional information on the following
points in the Swiss offer:
- The reason why the Swiss propose increased ceilings as compared with their March 23 offer for Group I items, other than bearings, exported to other Axis countries.
- The further concessions if any which the Swiss expect from us in return for reductions proposed in their June 15 offer.60
- The reason why the Swiss state that they would be willing to agree to the transfer of M9, Other machinery n.e.s. to Group 4. On the basis of the latest Swiss proposal this change does not appear to constitute any advantage to us.
- We do not understand Swiss reference to Item 914 in connection with reductions in Group 1 B.
- We also request that Bern make every effort to obtain a more favorable offer from the Swiss for Item M6, Machine Tools of all kind. We are most anxious to achieve this since it now constitutes the group considered to have the greatest strategic value to the enemy.
- We believe that it is of the utmost importance for our Minister at Bern to press the Swiss for a formal offer at the earliest possible date (our 2045 of June 14 repeated to London as 4725).
Please repeat the above message to our Legation in Bern as quickly as possible together with your comments and those of MEW on the points indicated above. We request that you also transmit your comments to the Department and FEA. [Department and FEA.]