A CANDID FRIEND

Stratford Evening Post, Volume XXXIX, Issue 83, 13 August 1923, Page 5

A CANDID FRIEND

BRITISH REPLY TO AULIES. DISAPPOINTMENT EXPRESSED FRANCO-BELGIAN EVASION Press Association—Copyright. Australian and NJS. Cable Association. (Received 9.2 a.m.) 'London, August 12. The British reply commences »y expressing the disappointment caused to the Government by the replies received from +be Fxench and Belgian Governments. With those Notes was submitted the draft joint Allied answer, which the Government proposed should be sent to the German memorandum of June 7. The proposal represented an earnest, effort to indicate a practical way of assuring as promptly as possible a final settlement' of the question of German reparations. Tlio Government understood, fbhat in the opinion of the French and Belgian (Governments the . two main obstacles in the wayi of any fresh, move in seeking a settlement were— Firstly, the necessity for scrupulously respecting the rights of the Reparations Commission : Secondly, the attitude of the German Government in encouraging passive resistance in the Ruhr. With both these questions, therefore, the Government proposed in the suggested reply to deal in a manner which they confidently expected would commend itself to their Allies. Howl completely they bad been disappointed in the expectations was made manifest by the contents of the Notes, wherein the French and Belgian Governments replied. Tlie reply seems all the more necessary, since, in the desire to avoid controversy at a critical phase, the Government refrained from sending any rejoinder to the observations which the French and Belgian Governments oommunelated over a month ago in reply to a questionairc. Sooner than embark on a controvsery the Government preferred to submit a definite plan of action, under which they proposed that a suggested inquiry into Germany's capacity to pay should be conducted within the framework of the Treaty, and that the German Government be called to withdraw the orders and measures enjoining passive resist-

a nee. Furthermore, in order to comply with the declared objections of the French and Belgian Allies to nny specific bargain on this point, the "British proposals were restricted to intimations that if the German Govornment abandoned passive resistance without delay, not only would this be regarded as evidence of good faith, but would involve reconsideration by the occupying Powers of the conditions of their occupation, and a gradual return to the normal features of industrial life in the Ruhr. Ifc was difficult to think in what way greater consideration could be shown to the Franco-Belgian viewpoint. Tbe reception, however, which had been accorded to these proposals b v the French and Belgian Governments in their replies leaves His Majesty's Government, notwithstanding; the terms of courtesy employed, to believe that neither are their suggestions welcomed by the Allies, nor is there offered that cooperation which can be held to merit consideration, except on the condition of no departure to be made from any one particular form, whatever •France and Belgium declare to be their overriding views and decision*. It is true the Belgian reply appears at first sight to be less uncompromising than the French Note. Closer examination bad shown that the attitude of the two Governments in all practical purposes was identical, and though the Belgian Government appears to bo specially anxious for a continuance of friendly conversations, it is only on the condition that the substance of tbe Belgian claims be conceded in advance. Accordingly, the Government, asks leave to deal with the two replies in a. single answer. The first point that struck the Government was that in neither was thero any allusion to the terms of the British draft reply to the German memorandum. The Belgian Government, indeed, is stiP in favour of the principle of a, joint reply, but the French pass the proposal over in complete silence. Yot this was the main object to which, ia the desire for the continued maintenance of Allied unity, the British Government devoted its efforts. Tho is hardhy compensated by a, series of argumentative passages, inquiries on points of detail, and offers of further discussions, holding out the prospect of an indefinitely spun-out controversy, whilst the fundamental principles are only I mentioned in order to declare that 'they l do not admit of discussion. It may, perhaps, be said that the Belgian reply does not reject as categorically as the French the proposal for jfrosh investigations into Germany's 'capacity to pay, but the consent of |'the Belgian Government for such an 'inquiry was made conditional upon | obtaining for Belgium and Franco I pecuniary, advantages of a far-reach-ling kind at the expense of tho Allies, i notably Britain. Such suggestion 'appears to the Government to reveal [a palpable misconception of the (situation. Tt need not bo contested that there can be no use in demand-

ing from Germany more than she is capable of paying. What is til© maximum she can pay is the question of supreme importance to all her creditors. It is a question of establishing the fact, on the ascertainment of which any practical arrangements of combinations for obtaining payment to the fullest possible must be based.

The Government accordingly proposed steps to ascertain this important, fact. Belgium implies that she will not consent unless a coresponding advantage is obtained for herself and France. The British Government, could not willingly enter into any such transaction while the Belgian Note does not indicate any precise claim.

The official and semi-official pronouncements by and on behalf of the French and Belgian Ministers made it clear that the French wish to insist on the minimum payment of their twenty-six milliard gold marks, over and. above the amount required to meet the debts owing to Britain find the United States, and the Belgians wish to insist «>n a minimum payment of five milliard gold marks, for which or for part they now ask further priority. If the estimate made on a five per cent basis by M. Bokanowski, rapporteur of the French Budget, putting the present value of the annuities under a schedule of payments at sixty-five milliard goM marks, be accepted as approximately the correct basis of calculation, the share of France and Belgium, as fixed by percentage under the Spa agreement, will not exceed thirtyfour milliard for France and 5.2 milliard for Belgium, even if Germany were in a position to pay the total figures in the schedule. But Belgium already, under the agreement entitling her to priority of payments amounting to one hundred million sterling, has received approximately seventy-three millions sterling, far exceeding the receipts of any other Power, though this priority Was given when the sum expected from Germany was immensely larger than anything now likely to be received.

it has not been reduced proportionately, and therefore operated to give Belgium an increasingly disproportionate share of actual receipts to date; in addition, *he has been entirely relieved of debts to the Allies amounting to nearly three hundred millions sterling. France on the other hand, when connting on receiving thirty-four milliard gold marks from Germany, woulcr have to balance this amount against her debt, to Britain, representing about twelve milliard gold marks, and debts to the United States amounting to at least the equivalent of fifteen milliard gold marks, which together leave France a" balance of seven milliard gold marks.