Reparations Report

Sun (Auckland), Volume III, Issue 685, 10 June 1929, Page 9

Reparations Report

EXPERTS’ PLAN REVEALED Revised Shares for Powers DOMINIONS’ PERCENTAGE FIXED British Official Wireless Received 11.50 a.m. RUGBY, Sunday. THE full text is now available of the report of the committee of experts on reparations. The main effect of the committee’s work, which has been achieved with unanimous agreement, is to substitute a definite fixed liability to cover Germany’s entire obligations of reparations, for the determinate scheme launched by the Dawes Conference in 1924, whereby it is expected that financial, economic and industrial interests throughout the world will benefit.

At present, under the Dawes Plan. Germany pays the equivalent of £125,000,000 a year for an indefinite period. It is important to note that, while no judicial connection exists between reparations and war debts, the experts have made a de facto relationship between them. They provide that if there is any reduction in the debts during the first 37 years, two-thirds of this relief shall profit Germany, and one-third shall benefit the creditor concerned. During the last 22 years Germany would benefit by the whole relief of each of the first 37 annuities. A sum equal to £33,000,000 is payable without any right of postponement. The committeee recognises that this is a conservative amount, but it considers it is wiser to under-estimate than to run the risk of weakening the German credit by fixing it too high. France’s share in this unconditional portion is £25,000,000. As to the major part of the annuity, Germany, by giving 90 days’ notice, can in the event of grave economic difficulties suspend it for a period of two years. A constant rise in the annual payments is to reflect tAe anticipated increase in Germany’s prosperity. The sources of the annuities are to be the German railways and the Budget of the Reich. The experts have decided to maintain deliveries in kind for a period of | 10 years. During the first year their j value will be £37,500,000, but they will* decrease progressively to £15,000,000 in the tenth year, when deliveries in kind will cease altogether. Of these deliveries, Great Britain takes 23 per cent., and France 54 per cent. As to Great Britain’s share in the whole annuity, the object of the British experts has been, first 6f all, to provide year-by-year covet for the American debt, leaving over and above this a constant sum to meet Dominion claims. The most important annexes to the reparations experts’ report relate to the reparation annuities. Britain obtains a variable annuity comprising: (1) A year to year cover for the Balfour Note obligations which will vary according to Britain’s payments to the United States. (2) A non-variable amount for the Dominions, which will obtain the full revised Spa percentages. The text of the report comprises 18,000 words, apart from the annexes. It is to be published tomorrow. In the meantime fresh details are available. It is anticipated that Britain will receive £20,900,000 out of each average annual payment by Germany of about £100,000,000. The report is to be forwarded to the Reparation Commission for submission to the Governments concerned. If they adopt it Germany will have a specific financial burden to carry for 50 years. The creditor Powers have fixed the annual payments from Germany on the Young Plan, which virtually scraps the Dawes Plan and theoretically will come into force on April 1, 1930, but actually will begin to operate on September 1, 1929. The experts agree that ail the complicated foreign controls imposed on Germany of the Dawes Plan will disappear. Instead, Germany will freely undertake to pay an average annuity of £102,500,000 for 37 years, followed by an annuity of £85,000,000 for a further 21 years to cover war debts only. The annuities are to be divided unconditionally or conditionally upon the latter being deiayable with the approval of the committee to be appointed from the directors of the International Bank and the former furnishing a large capital sum to which France attaches importance. Germany’s liability for the costs of the armies of occupation is to cease on September 1, 1929, the suggested date from which the new scheme shall operate. This is regarded as meaning the evacuation of the Rhineland on that date. BRITAIN’S SHARE The Paris correspondent of the “Daily Telegraph” says Britain’s share of Germany’s reparation payments will be somewhat under the strict proportion which hitherto has been in force, but there are compensating advantages. Britain’s share no longer will be a fixed proportion, but the amount will vary year by year according to her debt payments, for which it provides for a year to year cover. | Besides that there is to be a constant amount to meet the claims ot the Dominions. Britain’s share in the early years will be on a somewhat higher basis than the present proportion, but in later years rather lower. Reparations in kind will be maintained for 10 years, beginning with £37,500,000 and decreasing to £15,000,000. SACRIFICES NECESSARY That limitation alone is worth a

sacrifice from the British point of view, says the correspondent. There is no concealment of the fact in British official quarters that an allowance for sacrifices has been necessary. Britain has the largest share of those sacrifices. The British delegates accepted them the more readily inasmuch as they felt Britain could only benefit from a settlement, whereas a failure would be a calamity. The International Bank will have a share capital of £20,000,000, to be subscribed by the central banks of the Powers represented on the Committee of Experts. One quarter of the capital will be paid up immedi* ately. The new bank will act as a clearing house for the of reparations and deliveries of raw materials. Also it will safeguard Germany’s credit. The profits of the bank will be placed in a fund for the benefit mainly of the Governments concerned, but 25 per cent, will be placed in reserve to assist Germany in paying the last annuities. It is estimated that France will receive a total of £698,350,000, compared with about £1,600,000,000 originally claimed by the Premier, M. Poincare.

OPINIONS IN GERMANY NEWSPAPERS DIVIDED IN THEIR VIEWS PARTY TO OPPOSE PLAN (Australian and N.Z. Press Association) BERLIN, Sunday. The Berlin newspapers give the reparations agreement a mixed reception. “Vorwaerts” describes it as a step forward politically and says it shows that the will to destroy Germany no longer exists. The “Berliner Tageblatt” says: “The most important aspect is not the evacuation of the Rhineland—that is bound to follow —but the evacuation of German economic life, which for 10 years has been occupied by creditors who believed they had an unlimited right to exploit Germany.” The “Vossiche Zeitung” says: “There will be a revision of the plan when the Allied countries return to economic reason. It is absurd to think that one nation should pay reparation to other nations for two generations.” The Nationalist organs describe the agreement as fatal to Germany. That party intends to oppose it in the Reichstag.