454.119/10–1050: Telegram

The Minister in Switzerland (Vincent) to the Secretary of State

confidential

532. Excon. In recent conversation with Zehnder,1 he expressed fear, based on reports of Swiss businessmen, that a general embargo, through refusal to approve export licenses, had been placed by US on shipments of critical materials to Switzerland. He mentioned particularly nonferrous materials and asked whether this was policy directed solely against Switzerland or whether it was general measure adopted while assessment being made of over-all rearmament needs. I told him I was unaware of any specific embargo of exports of the kind to Switzerland and therefore that his second assumption seemed nearer the mark.

The Swiss have recently adopted an extensive rearmament program whose implementation will depend in large measure on imports of unprocessed materials from US, and they are deeply concerned that allocation under MDAP may exclude them entirely from American market. Zehnder indicated that Swiss might now be prepared to give firm guarantee that imported strategic materials would not be re-exported. Question arises, however, concerning internally produced products, such as machine tools, which contain in some degree materials from US. Swiss insist that such machines are going to East in ever decreasing amounts. It is possible that augmented purchases from West resulting from rearmament program would result in complete denial to East.

Problem now is whether we should obtain firm Swiss Government control over the transshipment of strategic materials (present government controls over export or re-export arms and armament, we believe, effectively denies such items to East) as prerequisite to export licensing of critical materials to Switzerland, or whether we should use Swiss need of these materials as lever for endeavoring to obtain Swiss export control over all imported and internally produced strategic items generally included on international lists.

Department’s views would be appreciated.

Vincent
  1. Dr. Alfred Zehnder, Chief of the Division of Political Affairs, Swiss Political Department.