'File 73/7 I (D 19) Status of Kuwait & Baghdad Railway, and Anglo-Turkish negotiations 1911' [‎24r] (65/631)

pressure on the Germans with this object. One solution would be to make the
line south of Baghdad an international one; another solution would be that
it should be a Turkish Government line, a suitable arrangement being made
with the interests concerned for providing the capital.
As regards the position of Turkey generally, he said emphatically that,
in his view, it was most undesirable to give any one Power an exclusive or
preponderant influence in Turkish affairs. He wished to remain on good
terms with all the world; and the interests of Turkey lay in securing the
assistance of all the Powers equally for her development.
I then spoke again of the position of the bank. I said that so far the
bank had received no practical evidence of the Government's desire to support
it. No Government accounts had been given to us, and the only semi-official
account we had was that of the Commission de la Elotte. The Constantinople
loan had only been arranged after competition with other banks, and after
a struggle lasting over several months. I asked whether he could give me
any assurances of practical support in the future which I could lay before
our friends in London. Hakki Pasha An Ottoman title used after the names of certain provincial governors, high-ranking officials and military commanders. said that, as regards Government
accounts, their hands were tied to a very considerable extent by the terms
of the concession of the Ottoman Bank. The Constantinople municipal loan
had produced profit sufficient to cover the expenses of the bank for one year at
any rate. If the bank had been able to conclude the loan recently under
discussion, the profits would have provided for the bank for two or three years
at least. Unfortunately, this had been prevented by the action of the British
Government, which, he said, speaking quite unofficially, he could only describe
as a blunder. If the British Government did not interpose any bar in future
the National Bank would be able to take part in Government loans, either in
co-operation with the Ottoman Bank or in competition with it. Apart from
that, he repeated that the whole of Turkey was open to foreign enterprise, and
that'foreign capital would be welcomed. If British capital would come to take
part in the development of the country, there would be a profitable field for the
bank's energies. He regretted that British capital had taken so little interest
in Turkey In recent years, and thought that both the press and commercial
circles were not well-informed. He referred in this connection to the mining
law, in the amendment of which the British Government had taken a great
interest. The law had been amended, but in the two years which had elapsed
since then there had not, so far as he was aware, been a single British application
for a mining concession.
I replied that British capital had had very good reasons for avoiding the
country under the old regime; and in order to persuade it to come here now it
was necessary to offer adequate inducements, and to create the conditions neces
sary for success. In the case of mines, for instance, the absence oi roads and
railways made all mines, except the richest, unremunerative. This accounted
for the absence of applicants. As regards works of public utility we found,
unfortunately, a certain want of practical sense in the Public T* orks Depart
ment. With the object of securing advantages to the State concessions were
hedged round with impossible conditions. It would be to the real interest of
the "Government to grant the first concessions on terms which would make
them thoroughly remunerative; whereas the conditions now laid down were
such that there could not be a large profit, and that there might very likely be
no profit at all. ^
Hakki Pasha An Ottoman title used after the names of certain provincial governors, high-ranking officials and military commanders. admitted that there was truth in what I said, but added
that in his own opinion, this difficulty would disappear in time. At the outset
of a parliamentarv regime, there was a tendency to criticise everything. In
the endeavour to'avert such criticism, the conditions had perhaps been drawn
too tightly. Experience would remedy these defects.
I asked the Grand Vizier whether they proposed to approve the Baghdad
municipal loan. He said that he had been somewhat disappointed as regards
the administrative capacities of Nazim Pasha An Ottoman title used after the names of certain provincial governors, high-ranking officials and military commanders. , and that they had doubted
whether the money would be satisfactorily spent if it were granted. He
thought however, that they would come to the decision to support Nazim
Pasha An Ottoman title used after the names of certain provincial governors, high-ranking officials and military commanders. still and in that case thev would approve the loan. I represented that