Hard Bargaining May be Soviet Line

Grey River Argus, 4 September 1948, Page 5

Hard Bargaining May be Soviet Line

Blockade and Currency

Issues Uppermost

LONDON, September .3

On Monday the four Allied Military Governor's in Germany held their third meeting in Berlin. The conference lasted two hours, 37 mniutes, instead of an anticipated several hours. It is reported that this abrupt ending was caused by technical problems which the advisers were unable to solve. Marshal Sokolovsky, was accompanied to the Governors’ meeting by General Borzof, chief of the Soviet tele-communications and an expert who is known as “one of Moscow’s toughest bargainers.” General Borzof’s appearance confirmed the earlier reports that hard bargaining could be expected and prompted speculation that the Russians might toss into the scales their ability to cut off Berlin’s telephone and telegraph communications with Western Germany. It is reported problems discussed at the meeting included insistence by the Western Governors that Russia agree to increase the daily quota of trains when the blockade was' lifted so as to replenish depleted stocks, and a British proposal to guarantee the Western sector industries financial equality with the- Soviet sector industries if the Russian currency is accepted for the whole of Berlin. General Clay refused to comment after to-day’s meeting, but an American official said the Governors would meet again to-day. The German News Agency reported that the four Governors received directives to complete the present discussions within ten days so that the Moscow negotiators can reach a final decision by September 15. BLOCKADE QUESTION

United States sources said to-day that they expected the Russians would remove the technical difficulties which caused the blockade in return for Western currency concessions. The Russians, however, would not agree to lift the blockade unconditionally and would insist on retaining certain controls over transport and' trade between the Western zones and Berlin. The French licensed Berlin newspaper, “Kurier,” quoted a French representative as saying the chances of lifting the blockade were “fifty-fifty.” General Babcock, United States deputy-commandant, appealed to Berliners to “have faith in the present talks.” German political circles ‘are becoming increasingly pessimistic about the outcome of the Berlin-Moscow conferences. A city official said today: “The operation, may be successful, but it looks as though the patient will most certainly die. The Allies may reach an agreement, but at such a cost to the Westerners that they might just as well have left Berlin in the first place.” CURRENCY QUESTION

“The Times” Berlin correspondent says that in the absence of authoritative’’information about the talks rumours are rife, with uncertainty developing into uneasiness. The implications of the Moscow “agreement in principle” to recognise Eastern currency as the only money valid throughout the city are being increasingly disliked. The fear is expressed that the Russians will have won the position which they hitherto failed to achieve by either persuasion or pressure. The French-licensed newspaper, “Kurier,” asks what guarantees can be devised to ensure that the recognition of the Soviet mark as valid currency will not lead to the incorporation of Berlin with the Eastern economy. On Thursday, swindlers did a roaring trade on Berlin’s black market, when they began selling banknotes described as the “new uniform currency for all Berlin.” They sold the

notes—Eastern marks with stamps bearing the Berlin city crest affixed —at the rate of one for two Eastern marks. When customers examined the “new” currency carefully, they found the stamps were trade mark stickers used by a Berlin bakery.