Politically this generates enormous difficulties for the Germans. In the lead up to WWII, Germany and the USSR held secret talks, that ultimately led to the non-aggression pactand trade agreement, both vital to German expansion and conquests, and critical to the German economy. Part of that discussion was of course the dismemberment of Poland, but there were also understandings reached concerning the Baltic states. Lithuania was thought by the Germans to be in their sphere, but the Russians were handed control of Estonia and and Latvia. The Russians were already in occupation of Estonia by the time of the Winter War, using many of the airfields and ports for airstrikes and to refuel submarines and light naval forces. Its difficult to see the Soviet German pact being agreed upon by Stalin without Estonias being given to them
One of the reasons the germans turned on the Sovets was that the Russians failed to honour the agreements concerning the Baltic states. In 1940, stalin moved to militarily occupy all three, which infuriated Hilter. The Russians also brought great pressure on Rumania, occupying Bessarabia, which for obvious reasons was very sensitive to the Germans. Germany wanted the Russians to expand south at the expense of Turkey and from there, bring pressure to bear on the Allies. Stalin never had any intention of taking his eyes off eastern Europe.
Germany changed the deal on the Baltics to give Lithuania to Stalin in exchange for Poland beyond the Vistula, but Stalin took a strip that had been left to Germany; Stalin also angered Hitler by taking more of Bukowina from Romania than agreed on:
Germanâ€"Soviet Border and Commercial Agreement - Wikipedia, the free encyclopedia
Sphere of influence didn't so much mean "handed over" to Hitler. It meant more along the lines of buffer state with military allegiances and trade agreements that favoured the Soviets rather than the Germans. Estonias independence was specifically in the pact. That's why Stalins actions in Finland, the Baltic (which irritated and threatened Hitler) and his games down near Hungary and Romania (Soviet occupation of Bessarabia and Northern Bukovina ie much of Romania) cracked the relationship, he went way too far and was now threatening Germanys supplier of oil. Hitler had previously offered Poland a joint Polish-German non aggression pact against the USSR but Chamberlains misinterpreted 'guarantee' cracked that up.
For someone who was always portraying himself/his country as victimized by the Germans, Uncle Joe sure liked to push Hitler's/Germany's buttons.
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