2 AUGUST 1940, Page 2

Iberian Allies

The new agreement by which Spain and Portugal have this week strengthened the ties which already bind them will be viewed with satisfaction in this country. Its effect is to pledge either State to assist the other in repelling any threat to its independence, and is a further demonstration of the resolve prevailing in both Madrid and Lisbon to keep the Iberian Peninsula from being involved in the present conflict. It is expressly provided that the existing alliances of each State will be fully respected. Spain is not known to be bound by any such alliance; Portugal is, of course, Great Britain's oldest ally. The situation in which Spain and Portugal find themselves, strategically and economically, particularly since the collapse of France, is necessarily difficult. This country did something to ease it last month by arranging to finance the purchase by Spain of wheat and of certain Portuguese colonial products. Opportunities for such friendly collaboration may recur, par- ticularly if our endeavours to see that our blockade impedes none of the imports which the two Iberian countries need for their own consumption are successful. German pressure at Madrid and Lisbon is, and will continue to be, heavy, but it is in the interest of both countries, as they clearly recog- nise, to preserve friendly relations with the Power which controls the seas, and can help them in various ways in their tasks of development and reconstruction.