Foreign Relations of the United States: Diplomatic Papers, 1945, Europe, Volume IV

611.60D31/5–245: Telegram

The Acting Secretary of State to the United States Representative in Finland (Hamilton)

Washington, May 2, 1945—6 p.m.

70. For your information and for use as you see fit in conversations with Finnish Government officials, the following are the Department’s comments on the three proposals made by Enckell and Gartz as outlined in your 157 April 12:⁵²

1. The proposal to use blocked Finnish funds in this country to repay the Soviet Government⁵³ raises difficult questions of policy as regards the disposition of such balances. The Department and Treasury regard the raising of this question as premature at this time and you should so indicate to the appropriate Finnish officials.

2. As regards the use of the unexpended balance of the Eximbank⁵⁴ credit to the Finnish American Trading Corporation, it may be said that the Eximbank is prepared to give consideration to specific proposals submitted by the Finns. However, the comments you have already made to the Finns in this connection are relevant and in general the Department would regard it premature at this time for the Finns to propose utilization in new projects of all or any substantial part of the balances in question. The Eximbank has no record of any inquiry into this matter by the Swedish Legation on behalf of the Finnish Government.

3. In reply to the third proposition advanced by Enckell and Gartz contemplating the sale of wood products to the U.S., you are informed that the question of the future disposition of Northern European wood products is now under discussion by the Combined Baw Materials Board.⁵⁵ Arrangements at this time for marketing Finnish wood products in the U.S. would be premature. You will be advised of any decision arrived at by the CEMB affecting Finnish wood products. As regards the export to the U. S. of any Finnish commodities other than wood products, the Eximbank reports that if facilities are not obtainable from N. Y. banks (which is believed to be doubtful), the Eximbank may be able to extend credits to Finland to finance exportation to the U. S. Such credits would be made on the basis of suitable contracts with approved private importers in the U. S. Payment could be made to Finland in advance of shipment on mutually satisfactory terms provided the Finnish Government gave guarantees as to specifications of quality and actual shipment.

4. In transmitting the above information to Finnish officials you should avoid any implication that the U. S. Government is not interested in doing everything possible to facilitate the resumption of normal trade relationships at the earliest possible date. At present, however, there are unavoidable but temporary obstacles in the path of such resumption.

5. The Department is very pleased with the manner in which you have been handling these questions.

Grew

52. Not printed.
53. The reference is to a commercial advance in the amount of $6,000,000 made by the Government of the Soviet Union to the Finnish Government in June 1940 for the construction of ships by Finland for the Soviet Union. The ships had never been delivered. The People’s Commissar for Foreign Trade, Anastas lvanovich Mikoyan, had suggested that Finland pay back the advance and that the contract be cancelled.
54. Export-Import Bank of Washington.
55. A joint American and British agency created in 1942 for the purpose of planning the best and speediest development, expansion, and use of raw material resources.