860d.51/8–946: Telegram

The Minister in Finland (Hamilton) to the Secretary of State


560. Graesbeck, head Finnish Financial Mission to USA last autumn and Matti Virkkunen, director Commercial Section FonOff called on me August 8. They said they came to advise me in person of their forthcoming visit to USA to give general outline Finland’s present financial position and to bespeak my support. Finnish Govt has decided to send them to Washington to investigate possibilities obtaining further credits preferably from Ex-Im Bank but if not available there from private banks. Finnish Govt feels it must have additional credits this year. They said Ex-Im Bank was aware through Finnish Legation in Washington they are coming. Whole matter has been handled essentially by Finnish Legation and Ex-Im Bank had indicated it had some questions and could not indicate readiness to negotiate new credit but would of course, talk with them.6 Finnish Govt realizes that Ex-Im Bank has many applications before it and that Bank’s funds are limited. Because of this and Finland’s urgent needs Finnish Govt feels it necessary to send experts who have most recent information on current economic and financial conditions here and are thus in better position than Finnish Legation to put Finland’s case to and answer inquiries of American authorities.

I wondered whether Finland was doing all it could to increase its sales to USA. I think this aspect should be borne down on.

I told them I thought it would be a mistake for them to go to USA with too optimistic a feeling. Ex-Im Bank had many demands on it. Its funds were limited and they should not have unduly rosy expectations. They said they realized difficulties but petitioners were always optimistic. They plan to leave Helsinki August 14 and to travel by air from Stockholm to America stopping about 5 days in London, arriving Washington about August 25.

During their call I asked about proposed Ex-Im Bank credit to General Motors for sale trucks to Finland (urtel 163, August 17). Virkkunen said Finnish Govt hoped obtain Ex-Im Bank credit to cover 25 percent cash down payment to be made by Finnish Govt. He said this proposition had arisen last October when Finland greatly needed trucks. Now due to purchases from Britain from US Army surplus [Page 244] stocks and elsewhere need was not as great and transaction had become principally General Motors’ proposal. Naturally Finland needed all trucks it could get but if amount of funds available for extension credit to Finland was limited General Motors’ proposition would not have as high priority as number of other items. They suggested General Motors proposition be held in abeyance until their arrival Washington.

On basis Virkkunen’s statements trucks do not at present have top priority and I therefore could not recommend favorable action General Motors’ proposition.

USA naturally desires as I told Graesbeck and Virkkunen, to see trade reestablished and expanded between USA and Finland and that Finland get back on healthy economic basis as soon as possible. Of course USA is not going to pay reparations. I feel that credits that our Govt may be in position to extend to Finland should go as far as feasible to aid in purchasing high priority items most needed to aid Finland’s economy. Exactly what those items are both as to Finland’s need and USA’s ability to supply are matters for Finnish and American experts. I therefore recommend that whole matter of extending further credits to Finland, including General Motors’ proposal under consideration, be held in abeyance until Graesbeck and Virkkunen arrive and that whole credit situation be then canvassed.

  1. Beginning in June 1946, the Finns expressed their wish to send a delegation to the United States to negotiate for an additional credit. The Export-Import Bank desired to clarify its view of the Finnish situation before discussing further credits for 1946, and the Department of State indicated its belief that further credit would be very doubtful because of the Bank’s limited funds.
  2. Not printed.