'File 73/7 I (D 19) Status of Kuwait & Baghdad Railway, and Anglo-Turkish negotiations 1911' [‎173r] (379/631)

J-.nL' 5_I)jcnmeat is the Pioperty of His Britannic majesty's Gcvenxrcent.!
eastern DErARTMENT. [Marcb 27/j
sk'-urt series . ^7
[11030] No. 1.
^' ir J ^• ^roscnen to Sir Edward Grey .—(Received March 27.)
(No. 75.)
^ r ' t tt a ttt ? Berlin, March 24, 1911.
. 1 ^ e l0n0U1 ' t 0 enclose herewith a translation of the account given in the
semi-omcial Nordueutsche Allgemeine Zeitung ' of the agTeements recently concluded
between the Ottoman Government and the Bagdad Railway Company,
lliis communique has been received with the greatest satisfaction by the rest of
the German press, and all the most important newspapers have jubilant articles on the
subject.
The c Kreuz-Zeitung' says that the agreements have given equal satisfaction in
Germany and lurkey. It passes lightly over the advantages gained by Germany in
obtaining the concession for the building of the Alexandretta-Osmanieh branch line,
and gives greater prominence to the benefits accruing to Turkey by the renunciation by
the Bagdad Railway Company of so manv of its rights.
It particularly points out that the renunciation of its claim to the proceeds of the
contemplated 4 per cent, customs increase has simplified matters for Turkey, and will
prevent the consent of other Powers to that increase being used as a lever to extract
unwilling concessions from her, or to exercise pressure on the Sublime Porte.
It appears from this observation that, in the opinion of the " Kreuz-Zeitung' at all
events, the release by the company of the proceeds of the 4 per cent, increase entails
the removal of all opposition to that increase on the part of other Governments.
1 he article goes on to say that by the present agreements Turkey has gained
greater freedom of action, and has in any case gained time, so that she can approach any
international negotiations, directly or indirectly, connected with the Bagdad Railway
question at her leisure, and without any fear of being hurried or forced into decisions
with regard to the recognition or non-recognition of " rights," such as those put forward
by England as regards Koweit.
" Neither," it adds, " will the German concessionnaires be under any necessity of
coming to any immediate decision with regard to any concessions which may be
demanded by other Powers interested."
The article then turns more particularly to the question of the southern section of
the Bagdad Railway, and in that connection it sounds a note of warning. It says that
while the postponement of international difficulties as regards the railway up to Bagdad
may be regarded with satisfaction, the postponement of the difficulties regarding the
Gulf section of the line is another matter, and entails upon the German Government the
exercise of the greatest circumspection and vigilance. It was true that in renouncing
its right to construct this section the company had stipulated that the German share
in the new company to be formed should not be less than the share of any other
non-Ottoman Power. The French press had objected that this renunciation on the
part of the company was illusory, as the Germans and the Turks could always outvote
the French and the English. This was, however, no certainty, and it might easily
happen that, if German capital was only assured a share equal to that of other Powers,
circumstances might arise in which an Anglo-French combination might gain the upper
hand. "We must therefore," it continues, "not shut our eyes to the danger that the
influence of German capital may become illusory, that England from the south may get
the deciding influence over the Bagdad Railway, and the Suez Canal drama be played over
again. In this way England is seeking real and lasting advantages, both political and
commercial. Germany, on the other hand, politically disinterested, seeks only to
maintain the principle of the open door, and, far from having any idea or intention to
set up permanent preferential tariffs, will be content with the temporary advantage of
supplying the material for the construction of the line. To give up permanent
advantages and acquired rights for such a transiton advantage would be a very
short-sighted policy. Consequently, a word of warning to the German companies
interested would not be out of season, and they should be advised to be very careful in
their future negotiations not to make concessions disproportionate to the transitory
advantages which it is desired to obtain by them."
[1932 dd— 4]