[matter omitted]

It is clear that Italy, which, before war actually broke out, was rather happy to lend its support to the German-Soviet pact, on the score that any stick was good enough to beat France and Britain with, is now becoming alarmed at the increase of Soviet power in Europe – in Poland and the Baltic – and at the possibility of greater Russian penetration in a region which Italy regards as part of her own sphere of influence, the Balkan peninsula. In this connection I attach an extract from a sheet circulated daily by 'Telepress',¹ an agency here under Italian influence. This extract, headed 'Rome contre Moscou', is an indication that official Italy is now taking openly a stand against the menace of Soviet Russia. This menace provides the possibility of eventual complications in Italo-German relations. Even in Germany itself, whilst the main German purpose is now to win the war, many thinking Germans must be exercised in their minds at the price which Germany is paying in Poland and the Baltic, and on the Roumanian frontier, for Russian support, and at the divergencies between the policies so labouriously worked out in 'Mein Kampf' and the present situation. Many people hold that Germany's policy in regard to Russia has brought about the encircling which she had been at pains to avoid. It could no doubt be Russia's policy to assist Germany to the point of enabling her to keep resisting, in order that both sides might be exhausted at the end, but few believe that it could ever be her policy to bring into being a preponderating Germany. Just as the Poles were all the time confused by the uncertainty caused by Soviet mobilisation in their rear, so Germans must wonder whether the time will not come when at a critical moment the Russians will let them down. It is useless to speculate, but the developments will be interesting to watch. The German-Soviet pact may eventually prove to be one of the deciding errors of the war. In the meantime, Italy is clearly becoming anxious, and is endeavouring to consolidate her position in the Balkan area. A settlement of some of the Bulgarian claims would help, but this is difficult to realise, as Roumania, the State chiefly concerned, fears that any territorial concessions would open the way to Hungarian claims to Transylvania. Roumania is pressing for the constitution of a neutral block of Balkan States with the help of Italy, but Roumania is in a weak position, with Hungarian eyes on Transylvania, Russian on Bessarabia and Bulgarian on the Dobrudja.

The view prevails here that things are on the verge of livening up on the Western front. In Balkan circles the view seems to be held that for the moment the Balkan countries are safe. The Finns here naturally remain anxious, although, as compared with last week, the tension for them has somewhat lessened. Even the Finnish situation is somewhat obscured by that now developing on the Belgian and especially on the Dutch frontier. The Belgians and Dutch here have become in the last few days extremely anxious, and they seem to expect a German attack, at least on Holland, at any moment. The view is held that the Germans cannot remain still indefinitely, and that they will try for a success with overwhelming force in the hope that they might be able to consolidate any position gained, during the period of forced inactivity in Winter. In Switzerland, it is not now seriously thought that the Germans will strike at both ends of the Maginot line simultaneously, but at the same time the Swiss authorities are taking new precautions, and are recalling to the colours as from Monday, 13 November, various classes which had not been retained. They are taking steps particularly to strengthen at once their active defence against air attack. I am told that at Berne, while all precautions are being taken, the view prevails that this country need not feel too anxious so long as Italy refrains from entering the war on the German side. Hope grows that Italy will not fight on the side of Germany.