Foreign Relations of the United States, 1958–1960, Eastern Europe; Finland; Greece; Turkey, Volume X, Part 2

227. Telegram From the Department of State to the Embassy in Finland⁰

Washington, November 14, 1960, 7:37 p.m.

245. Helsinki’s 305¹ and 309² not rptd all addresses. We have carefully studied complex interrelated questions raised by reftel, i.e. Finnish membership in EFTA, Finnish-Soviet negotiations on subject, GATT waiver, and effects on Norwegian and Swedish position vis-à-vis USSR on MFN issue. We have given special attention to whether US offer of economic aid to Finland desirable at this time. We continue to favor Finnish association with EFTA, consistent with GATT, and believe it would help check current erosion Western position in Finland. Such association should be brought about however in manner which would not facilitate increase in Soviet trade with Finland, or establish precedent detrimental principles GATT or seriously affect trade interests third countries. Our on balance conclusion is that US intervention at this stage with economic aid offer would do more harm than good. Among our reasons are: 1) not clear in what specific way US economic aid offer would reduce Soviet economic pressure; 2) signs of particular US interest or involvement could cause Soviets to adopt tougher position on Finnish EFTA membership; 3) recalling Kekkonen’s public rejection of $5 million US aid offer during Fagerholm cabinet crisis we question how he would react to economic assistance offer; 4) most effective manner strengthen President’s backbone could be to convince him wide concessions to Soviets would not prove acceptable to EFTA or West and would bring down upon him onus for failure EFTA negotiations to which he publicly committed; 5) preferable leave to EFTA partners, especially Scandinavians main responsibility providing support and advice to Finland (London’s 48 to Helsinki³ indicates this being done); 6) because of general considerations US policy we wish avoid any possible inference US would support general GATT waiver on MFN request. Therefore we believe US should not involve itself closely, should avoid coaching Finns on tactics and while reflecting negative view re general GATT waiver defer detailed determination US position other possibilities until all facts and attitudes of EFTA members are known.

In your anticipated discussion with Kekkonen suggest you take following line:

1) Call attention to Department’s public statement of policy towards Finland made at Mannerheim stamp ceremony.⁴ Note statement conforms to our understanding of Kekkonen’s own objectives which we agree with him are best under circumstances for Finland.

2) Stress risk slippage towards Soviets and fallacy of any belief soft-line would result in escape from pressures. US experience with dealing with Soviets all around world has convinced us firmness pays off.

3) US would like to see development of greater contacts between Finland and West and continued expansion of Finnish trade with West. As evidence you may cite increase in number of exchange grants from 156 in FY 60 to 236 in FY 61 and plans for trade fair in Helsinki in May 1961. We assume Kekkonen shares this desire and would welcome suggestions from him for further steps in this direction consistent with Finland’s policy of neutrality.

4) In our view EFTA membership would be valuable Western tie for Finland and in addition would provide useful countervailant to Soviet pressures. We recall that Kekkonen stated immediately after Khrushchev’s visit that Soviets would not invite him to Moscow unless they had reached agreement with Finns. Desired outcome of negotiations would be frustrated by yielding to Soviet demands which diluted EFTA or contravened GATT principles and Western opinion would consider Finland responsible for failure.

5) Should Kekkonen take initiative and ask for US economic aid, you should say you will transmit his request to US Government. Should Kekkonen request US commitment to support general GATT waiver on MFN question, you should discourage him from believing US would respond affirmatively.

Other recipients may use above for background in confidential discussions Government officials. At their discretion they may say US continues to favor Finnish affiliation EFTA. However US in not involving itself at this stage and beyond antipathy to general waiver approach does not plan to reach a position on other possibilities until all facts are known including views other EFTA members. On other hand believe support and advice EFTA members to Finland entirely appropriate at this time.⁵

Herter

0. Source: Department of State, Central Files, 760E.11/11–1460. Secret; Niact; Limit Distribution. Drafted by Burdett and approved by White, who signed for Herter. Repeated to Stockholm, Oslo, Moscow, Geneva (GATT), London, Vienna, Copenhagen, and Lisbon.
1. Document 226.
2. In telegram 309 from Helsinki, November 14, Ambassador Sessions notified the Department of State that if it wished him to raise any particular matter with President Kekkonen before he returned to the United States, Kekkonen had invited him to private luncheon on November 15 and would receive him for a farewell call on November 17. (Department of State, Central Files, 760E.11/11–1460)
3. Telegram 2178 from London, November 10, repeated to Helsinki as telegram 48, reported that the Foreign Office had given the Finnish Minister of Trade and Industry no reason to believe that Finland could obtain a GATT waiver to permit it both to associate with the EFTA and to maintain its special trading relationship with the Soviet Union. It further reported that a Foreign Office representative nevertheless conceded that granting Finland a limited waiver might not be too high a price to pay for the political advantages of allowing it some form of EFTA membership. (Ibid., 394.41/11–1060)
4. For text of Merchant’s remarks at the dedication of the Gustav Mannerheim “Champion of Liberty” postage stamp on October 26, see Department of State Bulletin, November 14, 1960, p. 751.
5. No documentation on the results of Sessions’ last meetings with Kekkonen has been found in Department of State files. Sessions left Helsinki on November 20.