312 Lord Caldecote, U.K. Secretary of State for Dominion Affairs, to Mr R. G. Menzies, Prime Minister

Circular cablegram M32 LONDON, 30 May 1940, 4.15 a.m.

MOST SECRET FOLLOWING FOR THE PRIME MINISTER

ITALY

Count Ciano [1] has told His Majesty's Ambassador at Rome [2] that Italy's entry into the war is now certain. He would not give the exact date but said that it might be within a week and would no longer be a matter of a month. He further said that even if France were now to offer to cede Tunis, Algeria and Morocco, Signor Mussolini would refuse to discuss the offer. Meanwhile contraband and clearing negotiations with the United Kingdom have been abruptly broken off by the Italian Government on what looks like a pretext, and Italy continues openly to prepare for war.

Only logical deduction to be drawn is that Signor Mussolini is awaiting the moment of maximum embarrassment to the Allies in order to attack.

The situation therefore looks graver than at any time hitherto.

1 Italian Foreign Minister.

2 Sir Percy Loraine.

[AA: A981, ITALY 60B]