Foreign Relations of the United States, 1949, Western Europe, Volume IV

711.59/10–149

Policy Statement of the Department of State

secret

[Washington,] October 1, 1949.

Denmark

a. objectives

The objectives of US policy toward Denmark are: (1) to maintain Denmark’s independence and to strengthen both her will and her ability to resist aggression; (2) to encourage Danish political and economic cooperation in international activities as a member of the community of free nations; (3) to re-establish a viable economy which will enable Denmark to maintain its standard of living at a level that would assure a healthy and democratic social and political structure and would eliminate any economic conditions favorable for the growth of Communism; and (4) to maintain and strengthen friendly relations and cooperation based upon the similarity of outlook and identity of interests of the two nations. A special objective of our policy toward Denmark is the replacement of the 1941 Agreement for the Defense of Greenland¹ by a long-term arrangement which will be satisfactory to Denmark and which will fulfill our strategic requirements.

b. policies

US policy with regard to Denmark is designed in general to obtain the greatest possible measure of cooperation on political, military and economic questions on the basis of recognized mutuality of interests and without the application of pressure.

1. Political

Danish devotion to democratic processes is deeply rooted in history and firmly established in present attitudes and practices. Danish cultural patterns are basically similar to those of the US, and strong ties between the two countries have been established by the relatively large number of Danish immigrants who maintain their connections with the mother country. These factors have increased our cordiality and concern for Denmark’s welfare.

US policy toward Denmark is also affected by the strategic location of the country. Denmark is situated at the entrance to the Baltic Sea and control of the country carries with it potential control over these waters. Denmark is also an ideal site for airports within easy range of England, Norway and the North Sea. It is thus of considerable importance that Denmark not fall into the hands of a potential enemy. So far as any internal threat is concerned, the success of this policy is relatively certain. Social and economic conditions in Denmark are such that it is not normally susceptible to the growth of Communism. During the German occupation, Communists were very active in the resistance movement and at the end of the war the USSR, as one of the principal Allies, enjoyed a considerable amount of good will in Denmark. The Communist Party was able to capitalize on this in the 1945 elections and as a result obtained 18 seats in the Folketing. Subsequently, however, their popular favor began to decline and in the elections in 1947 their popular vote and number of seats in the Folketing were cut in half. The Communist coup in Czechoslovakia and the increasing identification of the Communist Party with its masters in the Kremlin further lessened their support. Today the Party is no longer important enough decisively to influence Danish foreign policy against the US or seriously to threaten Denmark’s internal security. Nevertheless, it remains US policy to encourage the efforts of other Danish political parties to combat the Communists and to counteract local Communist propaganda.

The external threat of Soviet aggression confronts US policy with greater difficulties. Denmark is highly vulnerable, owing to her small population and flat topography. Moreover, it is in close proximity to Russian occupation forces in Germany. The military defenses existing at the time of the German occupation were destroyed and have been only partially replaced since the end of the war. It was because of this weakness that the Danish Government, in March, 1948, appealed to the US for weapons for re-equipping the army, but at that time the US was unable to comply.

Meanwhile, Danish foreign policy has reflected on the one hand military weakness and fear of Russia, and on the other the tradition of neutrality. Denmark had for many decades taken refuge in a policy of neutrality and after the war, although it became a member of the UN, it hoped to be able to maintain a neutral position. As differences began to develop between the US and the USSR, Denmark expressed the hope that it might serve as a bridge between east and west, and its policy was generally one of attempting to avoid giving grounds for offense to either party. It was our conviction, however, that efforts to cling to neutrality were unrealistic and rather than offering a safeguard to Denmark would expose it to greater peril.

With the widening of the division between east and west, Denmark became increasingly apprehensive about her vulnerability and entered eagerly into negotiations with Sweden and Norway for the establishment of a Scandinavian military alliance.² Denmark leaned toward a neutral alliance, such as that favored by Sweden, in the hope that it would be less likely to provoke the USSR. However, since the US could give no assurances of military aid to members of such a neutral Scandinavian group, and since Norway desired closer collaboration with the west and was unwilling in these circumstances to accept the Swedish conditions, Denmark’s efforts to bridge the gap between the other two countries failed. We welcomed membership of the Scandinavian countries in the Atlantic Pact which was then being negotiated, and Denmark, feeling particularly isolated in the absence of a Scandinavian pact, decided to follow the example of Norway. Danish regret that a Scandinavian pact was not possible still persists, and it is our policy to demonstrate to the Danes that their decision to sign the Atlantic Pact was a wise one and to encourage wholehearted Danish, collaboration.

It is also our policy to encourage Denmark to develop its own defenses and to strengthen its military establishment, and we plan to offer material aid to that end.

In the years between the two World Wars, Denmark was an active participant in the League of Nations, and when the United Nations was established Denmark became a member in the hope that it would be a more effective guarantor of peace and the security of small nations than the League had been. Initially Danish policy in the UN reflected Denmark’s traditionally neutral attitude, and during the immediate postwar period Denmark frequently abstained from voting on questions involving major differences between the east and the west. However, in 1947 and 1948 Denmark gradually took a more positive attitude, and during recent sessions of the UN General Assembly has been less hesitant about standing with the western powers against the Soviet Union and the satellite countries. We welcome such open indications of the coincidence of Danish views with ours.

Denmark is also a cooperative member of nearly all of the specialized agencies of the UN. While upon occasion its interests may differ from ours, it has generally been possible to obtain sympathetic Danish consideration of US views in those agencies.

The US has a special interest in Denmark because of Danish sovereignty over Greenland, which is of primary strategic importance in the defense of the US and the North Atlantic.³ In accordance with the Defense Agreement which was signed in April, 1941, the US established bases in Greenland. It was provided in the Agreement that these bases would be maintained “until it is agreed that the present dangers to the peace and security of the American Continent have passed”, and the Danes anticipated that with the defeat of Germany the need for these bases would disappear and the US would withdraw from its installations in Greenland. However, it has become apparent that the strategic need for defenses in Greenland still exists and in view of the developments in modern warfare it is likely to increase. Our policy therefore is to achieve an arrangement which will assure adequate defenses in Greenland while respecting the sovereignty of Denmark over the island.

Carrying out this policy, however, has presented certain difficulties. Denmark itself appears to be unable to fulfill more than a part of the defense requirements. From the standpoint of US interests the most satisfactory measure would be the outright purchase of the island, but the Danes say that this would be politically impossible for any Danish government. The granting of long-term treaty rights providing for leases on particular base areas, or for US access to and control of such unspecified areas as may seem necessary in the light of future developments, has also been thus far politically impractical. Danish national pride objects to any derogation of sovereignty in Greenland, and there is strong fear of Soviet retaliatory measures should Denmark grant the US permanent bases in Greenland.

As a result of a Communist attack in the Danish Parliament in May of 1947, the Danish Government felt it necessary to announce that it had initiated negotiations for the termination of the Defense Agreement as provided in Article 10. However, the Government has given us satisfactory assurances that the status quo will continue as long as the world crisis exists.

We anticipate that a new arrangement for the defense of Greenland can be made on the basis of protecting the interests of all members of the Atlantic Pact. This may take the form of continued US operation of defense installations there with some degree of Danish participation. Meanwhile, it is the policy of the US fully to respect Danish sovereignty over Greenland and Danish authority in the administration of the affairs of the island. We therefore observe Danish regulations in such matters as contacts between US personnel and the native population. At the same time we have been carrying on only those operations considered most essential and are following the policy of keeping the Danes informed of any special projects which we may desire to undertake and of requesting their concurrence. Since the war we have turned over to the Danes for their operation most of the weather stations in Greenland established by US forces. It remains our policy to let the Danes operate installations which they are able and willing adequately to maintain.

Although the US enjoys considerable good will in Denmark, there is some uncertainty about US intentions, and distorted views of our actions at home and abroad obtain some currency. We therefore intend to maintain an information program which will seek to convey to the Danish people a true picture of the US and its policies, while avoiding any suggestion that we are carrying on a propaganda drive. Our most effective activities appear to be providing the Danish press, radio and interested individuals with full and objective reports on US policy and domestic developments, making available magazines, books, films, recordings, etc., which present an accurate picture of American life and culture, and encouraging and assisting in the exchange of students, professors, journalists and other persons, with particular emphasis on having Danes visit the US and encouraging Danish newspapers to maintain their own correspondents here.

2. Economic

Our policy is to assist Denmark in the re-establishment and maintenance of a sound and vigorous internal economy and in the development of foreign trade multilaterally balanced at the highest possible level. To this end the US is extending both loans and grants to Denmark through the ECA. Denmark has also been given loans by the Export-Import Bank, and it is our policy to encourage the investment of private American capital in Denmark. The US seeks to encourage the rationalization of the Danish economy and the most effective use of our financial assistance.

Denmark has been participating actively in the OEEC, and has taken the lead in promoting economic cooperation on a regional level in Scandinavia. This program has as its immediate objective greater economic integration, multilateral trade treaties, and common customs nomenclature, and as a long-range goal the eventual establishment of a Nordic customs union. We approve of these efforts toward European economic rationalization and integration, and of efforts toward greater freedom of trade on a regional basis to the extent that they do not conflict with our general commercial policy.

Our commercial policy toward Denmark seeks to provide for the establishment of trade relations between the US and Denmark according to the principles of the Charter of the proposed International Trade Organization. Because of balance of payments difficulties and for other reasons, Denmark has placed restrictions upon imports and has established rigid foreign exchange controls. The US has accepted the temporary necessity of these measures, but is opposed to their continuation in the long run. We have made some progress toward our objective of liberalizing Denmark’s international commercial practices, since Denmark signed the final act of the Habana Trade Conference and participated in the negotiations on the general agreement on tariffs and trade at Annecy. However, since Denmark produces few commodities which have a ready market in the US and its normal demand for US goods is relatively small, both countries should expect benefits to result largely from the multilateral aspects of the agreement.

Trade with eastern Europe, particularly with Poland for coal and the USSR for grains and industrial raw materials, has become of considerable importance to Denmark during the postwar period. This slight shift toward the east and away from Denmark’s traditional pattern of trade with the west is a result largely of the destruction of Germany as a producing unit and a market, and the inability of the UK to expand adequately its coal exports. The US recognizes the importance of this trade with eastern Europe for the economy of Denmark and interposes no objection to it so long as it is not disadvantageous to US security interests nor unnecessarily contrary to the principles of multilateral trade. Denmark has agreed to prohibit shipment to eastern Europe of most items which the US embargoes because of the contribution they would make to Soviet military potential, and we hope that for similar reasons Denmark will limit the shipment of certain other goods to that area.⁴

In the field of foreign exchange our policy toward Denmark is to obtain stable exchange rates through the International Monetary Fund and to work toward the elimination of exchange restrictions. The US has thus far accepted the necessity for the Danish Government’s program of bilateral trade and financial agreements, but is now prepared to support and encourage the establishment of a multilateral payments System in Europe and to encourage Denmark to participate in it. Meanwhile, in connection with the unblocking of Danish assets in this country, the Danish Government has given assurances that its exchange control restrictions will be liberalized to the fullest extent that the Danish foreign exchange position allows and it has announced that Danish exchange control officials were prepared to give careful consideration to requests for monetary transfers between Denmark and the US.

c. relations with other countries

. . . . . . . . . . . . . .

d. policy evaluation

US policy toward Denmark during the past year has had generally satisfactory results. Danish attitudes toward the US and its policies, though by no means uncritical, seem to reflect increased understanding and sympathy. A cooperative approach has been made to an expanding range of problems. Denmark has participated effectively in the ERP and collaborated with the ECA in the development of its economic program; at the same time, ECA aid has made a major contribution to the furtherance of our economic and political objectives. By signing the North Atlantic Pact, Denmark has turned sharply from its traditional policy of neutrality and shown a growing willingness to stand up and be counted among the western democracies, and an increased determination to resist aggression. However, Denmark’s decision has been taken in the hope that the US would provide military equipment which would enable Denmark to contribute to its own defense. Without such assistance, Denmark’s morale will be gravely shaken and our whole policy toward Denmark is likely to be undermined.

1. For documentation on negotiation and conclusion of this agreement of April 9, 1941, see Foreign Relations, 1941, vol. ii, pp. 35 ff. For text of agreement and notes exchanged, see Department of State, Executive Agreement Series No. 204, or 55 Stat. (pt. 2) 1245.
2. For documentation on the relationship of these Scandinavian negotiations to the development of the North Atlantic Pact, see the compilations on NATO, pp. 1 ff., and Foreign Relations, 1948, vol. iii, pp. 1 ff.
3. Danish concern over U.S. involvement in the defense of Greenland, with the related question of termination of the Defense Agreement of April 9, 1941, ceased to be a major issue between the two governments in 1949 as the defense of Greenland became part of the military planning of the North Atlantic Treaty Organization. Occasional references to the defense of Greenland may be found in the compilation on NATO, pp. 1 ff. The more detailed correspondence on the continuing transfer to Denmark of operational responsibility for Loran, fueling, weather reporting and defense installations in Greenland is in Department of” State files 859B.20 and 859B.9243. For previous documentation on this subject, see Foreign Relations, 1948, vol. iii, pp. 584 ff.
4. Documentation on U.S. policy with respect to trade with the Soviet Union and Eastern Europe is scheduled for publication in volume v.