AFRICA AND SANCTIONS

New Zealand Herald, Volume LXXIII, Issue 22413, 8 May 1936, Page 20

AFRICA AND SANCTIONS

"PARADOX" EXPLAINED SHIPPING COMPANY SUBSIDY [from otrct OWN correspondent] CAPETOWN. March 26 The "paradox" of South Africa's participating in sanctions against Italy and at the same time paying an annual subsidy of £1,500,000 to an Italian shipping company was raised in the House of Assembly by Mr. Leslie Blackwell, K.C. If, urged Mr Blackwell, there had been no specifio communication between South Africa and Geneva in regard to the shipping agreement, the Wgal duty of the Government in the light of the Union's sanctions policy j was to refuse to continue to pay the subsidy.

The Prime Minister, General Hertzog. said the Union Government had not consulted the co-ordinating committee of the League of Nations in respect of the Italian shipping subsidy because it did not concern the question of sanctions in any way. The Government's I>roclamation of October 30 set out the list of prohibited activities in respect of tho sanctions policy embarked upon by the League. The shipping subsidy did not fall under any of tho heads enumerated in that proclamation. The subsidy was payable not to Italy but to an individual shipping company in consequence of a contract entered into between the Union Government and that company. It was a payment for services rendered by that company.;, The Government had undertaken to pay to this company a certain sum each year for five years, and the money was paid in South Africa and not in or to Italy. There had never been any question or doubt about tho Government's right to continue this subsidy. Mr. ,C. te Water, the Union's representative at Geneva, who was a member of tho co-ordinating committee, and who knew all about the subsidy to the Jtalian shipping _ company, had never advised the Union Government that the subsidy was in any way a violation of the Union's obligations under the League, said the Prime Minister. The Union Government had never heard anything to suggest that its policy was in any way in conflict with the policy of the League of Nations. The Government would not have proceeded with the payment of tho subsidy for a moment if there had been any doubt about it being in conformity with the Union s obligations as a member of tho League.