THE FRENCH NOTE.

Poverty Bay Herald, Volume XLIX, Issue 16211, 23 August 1923, Page 6

THE FRENCH NOTE.

REPLY TO' BRITISH

AX 'ACCOMPANYING ANNEX!

lilec. i'ul u*pyri|fbi united Press Aas.i (Reiner's Telegram.) (Received Aug. 26, 2.5 p.m.) PARIS, Aug. 22.

An annexe to the French Note states : nail of deference and in courtesy to the British Government, we deemed it our duty to reply in the accompanying annexe point by point to tlie British Note. This reply, 'which is given in parallel columns, "sayti j France hitherto has not perceived the British Government's ciiorts to approach the ideals of France in the execution of the treaty, but Franco is convinced that mutual good will will lead to an agreement. The annexe cites the French determinatioll, a hundred times stated, not to abandon a centime of tbo reparations or the pledge she holds till the reparations have been completely paid. Britain's draft reply to Germany completely ignored France, becatiße it did not mention the essential condition, namely, the cessation of passive resistance. The British Note is courteous, but not conciliatory. Prance would have preferred a continuance of diplomatic exchanges instead of publicity. Germany's capacity to pay is zero, by the wish of the German Government. Thus valuation by exports is usoless, but this is no reason for wiping out the debt. The German debt has been fixed by the Reparations Commission, but France, while maintaining her claims, is ready to abandon a sum equivalent to the remission of her own war debts. France never said she would be content to receive thirtyfour milliards of gold marks. Her claims are theoretically sixty-eight milliards, and her debts twenty-seven. These are figures that should be balanced. The British merchant marine has been reconstituted. The German murine has been destroyed, or only reconstituted as tlie result of sales to Germany by England. Tj substitute experts for the Reparations Commission would Lei contrary to llv treaty. France denies the Commission is the reversa of impartial, and declare that France did,not go to Ruhr to fine, money for reparations, but to sci.-.e pledges and create a German will t., pay. France never suggested that she

i.ould abandon Ruhr immediately resist ance ceased and before payment is completed, trance refuses to accept tlie threat of appeal to the League of Nations, and says that the British vkv. of inter-Allied debts docs not accord with French interests, because there under the Allied debtors of Britain would make good what Germany failed to pay of Britain's debt to the United States, which France contends is practically identical with Britain's share of A and 11 bonds. If the British Cabinet; is una-hie to accord priority in respect to reparations, Fiance will be forced to rigorously adhere to the treaty figures. France) ardently destriM peace, but -the restoration of * Europe is impossible except by I lie observance of treaties. France* is conscious of loyalty to her engagements U> the Allici, and is resolved never to disown them.

(Received August 23, 2.20 p.m.; PARIS, August 'lt

The French reply to the British Note begins wiith n statement of France's position, which she claims contains the elements of a practical solution. The e'rench Government never dimmed p 1 pursuing- u selfish policy regarding reparations, which' siro iuscxJutiMe, without duo-regard Jo the whole European interests involved.- They have always taken info ae;ouufc the difficulties, of

sonic of th'Mr Allies, particularlytin lamentable and persistent imemploy maiit in England. Basing itself on the treaty, any infringement whereof would create a dangerous precedent, the statement details a' long series of crarccsftiohs to Germany before and lifter the assessment of her indebted* diss by tilie Reparations Conumiwsion, which concessions were never required, lint-'; merely resulted in further defaults. Germany to Ihc end of 1022 steadily made worse her position, and | never attempted txi put her budgetar house in order. She kept the trans port charges to the lowest in any conn 1 try, increased tho number of Allied : (li'i.cials, did n.>t Irx industrialists or f'Mpowncrß, whom she granted all ' manner of privileges and immunities, and buJlt-tip a new mercantile marine. 1 which is competing with British and i French shipping in American waters She has dug canals, and multiplied ' ;t le-phonos and other undertakings re gardlo&s of cost, all manner of work which France had been compelled to ' postpone; Such were the conditions when Franco, in pursuance of her pre viously announced intention of sci/.iug pledges, decided to occupy Ruhr. The French Note then upholds the legality of the Ruhr occupation. It lays down France's conditions as cabled earlier to-day, and adds: Germany's capacity in resources should be estimated periodically, the payments faking duo being modified according to the circumstances, sucli; modifications being decided by a majority vote of the Reparations Commission. The reply declares : There can be no doubt that damages to persons' property shoitld be granted priority over war costs. Consequently it is unthinkable that such ■ war costs should be claimed by the Allies from each other before Germany has begun to pay. The reply points out that Franco advanced huge sums on Germany's account, and cannot suspend the work ol reconstruction, nor continue indefinitely at her own expense. France li-id" never repudiated her war debts to America or England. .She is herseif a creditor ol other Allies to the extent of five to six milliards of gold marks. Tlie reply claims that the estimate of Germany's future capacity to pay at the very times she succeeded in momentarily bankrupting herself, would be equivalent to rewarding fraud, and enable her to make a fresh start, and soon flaunt her triumphant prosperity in the face of her needy creditors. France and Belgium hold sixty per cent, of the Allies' claims on,Germany. Therefore, if the question is to be regarded as merely a business matter, what would be said of a company wherein the holders of sixty per cent, of shares might be put in a minority by the holders of twenty per cent'; The reply concludes : Britain would be the first to realise that to pay her debts France must recover her taxable! capacity to be jn a position to meet German competition. It is doubtless in England's interest that Germany should recover. 11 certainly cannot be in Entiland'g interest that Frame be debased.