File No. 600.119/98
The Minister in Switzerland ( Stovall ) to the Secretary of State
[Received June 4, 11 a.m.]
989. Please see my previous telegrams Nos. 832, 868, 872, 889, 934, and 938,2 concerning the question of the proposed restriction on the part of the United States Government of the shipment of foodstuffs to neutrals. I have made an extensive and independent investigation of the general question of importations in Switzerland and submit the following summary.
In 1914 before outbreak of hostilities Switzerland entered into agreements with France and Germany whereby Switzerland was to receive cereals through intermediary of France and coal through [Page 1163] intermediary of Germany without compensation. Allies have fulfilled their agreement while Germany has demanded compensations for coal alleging that agreement applied only to transit through their country and that they were not obligated to produce and ship commodities. Swiss Federal Council gave its adherence to this interpretation in its reply to the Allies November 17 last.1
Swiss Society Surveillance is Swiss corporation established with consent of Federal Council for the sake of preventing export to Central powers of all goods which are either produced by Allies or shipped through them and cooperates with Federal authorities for this work. The only goods of above category permitted to be shipped to Central powers are certain ingredients which enter in proportion less than 5 per cent value in the manufacture of certain articles which can not be used for warlike purposes. Switzerland has been free to ship where she will the produce of her own land. The exportation to Central powers of articles produced in Switzerland of similar character to those which they import has been restricted but not stopped by reducing the ration per [for] articles which Swiss may receive through Allied countries. Switzerland has agreed to limit its shipments of its own produce (see my 938, May 22, 9 a.m.) in certain articles notably milk, cheese, butter as compensation for certain acts on Allies’ part. Latter two articles however are not important since quantity at home so limited she does not wish to export.
Both British and French have unofficial and official agents near frontier and their reports agree with those of our consular officers that contraband in goods imported under Swiss Society Surveillance guarantees is sent across frontier but that it is impossible to say in what quantities. Even with its utmost endeavors it would be impossible for Federal Government to prevent smuggling because of the excessive profits that the Germans offer, because of the amount of bribery they practice, because the people in that portion of Swiss territory are thoroughly pro-German in sympathies and because in some portions of the frontier there is only an imaginary line which it is impossible adequately to control even with the help of the military who have been called upon to assist. Allied Governments endeavor to make rations of various commodities small enough so that Switzerland will feel the pinch and use utmost endeavors to prevent exportation.
For the foodstuffs which Switzerland exported to the Central powers in 1916 the only food she received in any quantity in return [Page 1164] was potatoes, somewhat under 59,000 tons, much of which was of inferior quality, I am informed, and unfit for human food.
Germany has recently endeavored to prevent exportation to Allies of all goods manufactured from German raw materials or with assistance of German coal and Allies have retaliated by providing that in manufacture of articles for Germany no oil supplied by Allies may be consumed nor may any machines be used imported subsequent to August 1, 1914. The preceding question is still in state of negotiations.
I understand that Allies’ Legations here are about to urge their Governments to take measures with Department of State to ask latter to endeavor to negotiate a convention with Switzerland whereby we agree to provision this country as well as [possible] after the needs of the Allies have been cared for in return for Switzerland’s agreement to the doctrine of similar articles; that is to say, Switzerland will not export any article to Central powers of which she imports quantities from or through Allies. This should not only apply to identic articles but to [articles] of same general class; for example, Switzerland’s exportations to Germany of certain class of leather goods are important. These goods are of leather of home production but Switzerland imports considerable quantities of leather through Allies. [In] confidential list of exports leather is the article of greatest importance in this category. It is suggested that these negotiations be inaugurated about July 1, since a German-Swiss agreement expires on July 31, and the fact of American demands independent of Allies would have salutary effect in forcing Swiss to adopt a resolute attitude to resist Germany’s further exactions. I will send further details on this point when I have the text of the recommendations of the Legations to their Governments.
As the Department already knows the only articles from Germany which Switzerland can not do without are coal and iron, especially coal, of which they received from the Central powers in 1916 a quantity of 3,143,000 tons. If the Allies or ourselves were in a position to deliver a reasonable proportion of this quantity we could justly demand as compensation for our shipments a complete stoppage of traffic with Germany, shutting out what food the latter receives from Switzerland, shut off even more important shipments of electrical machines which are manufactured in Switzerland from commodities supplied by Germans, and align Switzerland completely with the Allied group in economic questions. In this connection I might add that Switzerland’s most profitable trade with Germany has already received a serious blow through Germany’s prohibition of the import of articles of luxury (only 18,000,000 francs may be imported in the three months’ duration of present agreement) in spite of commercial [Page 1165] treaty with Swiss Government guaranteeing import. My telegram No. 832, April 25, 5 p.m., explains how Germany demands shipment of cattle as compelling [omission].
Germany has contracted for an electrically wired fence some kilo-meters back of her frontiers from Sweden [Switzerland] and the Swiss claim they must feed the population within the fenced district since they have no communication with rest of Germany. British Minister is ready to make representations to Swiss concerning this and demand that Swiss Society Surveillance material be not sent into Germany on this excuse and that Germany must feed her own people. French Ambassador has asked for permission to make joint representations with British and they have suggested that I follow up their action with an informal conversation with Minister for Foreign Affairs suggesting that while the question of food shipments is acute in the United States it would make a bad impression to refuse this demand of the Allies. I shall follow such a course unless the Department instructs me to the contrary.
The question of fodder is becoming more difficult and it seems highly probable that cattle will be offered for sale to the Allies (see my 832 and 938). I therefore respectfully request that Department will consider advisability of following plan suggested in my No. 832.
France is allowing transit through her territory without compensation because of her agreement with Switzerland. Germany is demanding compensations other than money for her shipments in spite of understood agreement. I can see no reason why America with no agreement should not demand a quid pro quo which will give our cause an advantage when we are supplying the most essential commodities of all.