5. Telegram From the Embassy in Finland to the Department of State0

469. Paris pass USRO. Reference Deptel 523.1 [less than 1 line of source text not declassified] Foreign Office, in frank discussion problems GOF re OEEC, said general feeling in government is that Soviet reaction if Finland should join would not pose serious problem. Minority, however, disagree, seeing possibility of at least commercial pressure. GOF has not discussed directly or indirectly with Soviets, [less than 1 line of source text not declassified] indicated that if decision finally reached and Soviets had not given forewarning of violent objection plan would be to present Soviets with fait accompli and meet any Soviet objections with frank explanation that decision motivated by economic considerations alone, particularly necessity Finland’s being in position follow other northern countries into European Free Trade Area, [less than 1 line of source text not declassified] believed Soviets appreciative compelling reality behind this argument. Also repeated now standard point that Soviets are largely free of suspicion Finnish political motives.

[less than 1 line of source text not declassified] said that above analysis might turn out “wishful thinking” and that the analysis would be carefully and continuously checked before final decision to join made. Said GOF could hardly afford join and then be forced withdraw, a contingency [less than 1 line of source text not declassified] seemed particularly to envisage if OEEC should be “subordinated to Council of Europe or NATO”, [less than 1 line of source text not declassified] made clear that in any event GOF would not risk final action until completion current price and contract negotiations implementing 1958 Finnish-Soviet trade agreement. Anticipated that for most items this would be soon although for some might be late in year. While not specific on point, [less than 1 line of source text not declassified] suggested delay would be only until bulk of items settled. Otherwise timing of final decision would be “up to OEEC countries”.

[less than 1 line of source text not declassified] stated GOF believed OEEC probably would be satisfied with existing degree liberalization for present and would allow “two or three years” to meet OEEC standard. Expressed hope US would exert influence this direction.

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[less than 1 line of source text not declassified] noted that if contrary to expectations Soviet trade pressure applied, Finland would need financial help and would hope to get it.

Embassy comment: Our general impression is that Finns, despite avowed confidence, remain quite concerned over threat of Soviet reaction, but feel have no alternative since otherwise would face danger economic isolation through other northern countries joining Free Trade Area. This factor rather than any sudden appeal OEEC key their policy. Even this, however, probably would not induce them go ahead if Soviets made clear would react strongly or if OEEC subordinated to Council of Europe or NATO. This connection important to note great vulnerability Finland to Soviet economic pressure. Aside from possible Soviet pressure, Finn economy appears in reasonably good position to meet requirement OEEC membership. Might be noted foreign exchange reserves have risen rather than fallen in period since liberalizations and are currently about $115 million.

May have further comments on economic aspects [less than 1 line of source text not declassified].2

  1. Source: Department of State, Central Files, 840.00/1–3058. Confidential. Repeated priority to Paris.
  2. Printed as Document 4.
  3. Following further talks with Finnish officials, Harvey reported in telegram 480 from Helsinki, February 7, that the Finnish Government had probably postponed a decision on OEEC membership so as to gauge the reaction by the Soviet Union and the progress, or lack of progress, toward a European free trade area. He concluded, however, that if the OEEC approved Finnish membership without too stringent requirements and the international situation remained essentially unchanged, the Finnish Government “will take the plunge possibly before general elections in July.” (Department of State, Central Files, 840.00/2–758)