Coll 17/10(1) 'Internal: political situation; relations with HMG' [‎357v] (719/982)

preferred stock to be issued by the corporation ot the nominal value of some
£2 million The directors of both of these administrations are British, and their
technical and administrative staffs are composed predominantly of British
subiects At the present time British subjects in the service of the Iraqi Railways
Administration and of the Port Administration number respectively seventy-four
and fifty-five, exclusive of British Indians occupying subordinate positions.
This aspect of British interests in Iraq, the employment provided for British
subjects, should be given full weight in considering also the details which follow
concerning British commercial activities in the country.
With the single exception of Egypt, there is no foreign country in the Near
and Middle East where British commercial interests are at the moment so well
established and of such extensive scope as in Iraq. It is difficult to estimate
accurately the amount of British capital invested in the oil industry alone. The
capital of the Iraq Petroleum Company" (£6,500,000) and its subsidiary, Mediter
ranean Pipe-Eines (Limited) (£9,178,000), is owned as to 23-75 per cent., by the
Anglo-Persian Oil Company, and as to a further 23-75 per cent, by the Anglo-
Saxon Petroleum Company (Royal Dutch-Shelrgroup), French and United States
interests owning between them 47 per cent, of the balance. It is specified in the
company’s convention that it shall remain a registered British company, and that
its chairman shall at all times be a British subject. The majority of the company’s
technical employees are British and all other responsible positions in Iraq are
filled by British subjects. The machinery and material necessary to its operations
are predominantly of British manufacture. For the pipe-line construction alone
approximately 200,000 tons of material have been imported into Iraq, and the
possibility of laying one or more further pipe-lines, should the demand justify it,
is already being envisaged.
The Khanaqin Oil Company and its subsidiary, the Rafidain Oil Company
(the marketing concern for the sale of oil products in Iraq, formed in accordance
with the terms of the first-named company’s concession) form part of the Anglo-
Persian Oil Company; the Khanaqin Oil Company at present extracts annually
from its field at Naft Khaneh about 60,000 tons of fuel oil, 15,000 tons of kerosene,
and 12,000 tons of petrol, all of which is consumed in Iraq. These quantities do
not, however, represent a maximum. In both companies all responsible positions
are filled by British subjects.
Mosul Oil-fields (Limited) are the operating company for the British Oil
Development Company’s concession in Northern Iraq. As originally constituted,
this concern consisted of British, French, German and Italian interests, the
nominal capital being £1 million. Early this year difficulty arose over payment of
the second annual dead rental of £125,000 gold (£190.000 sterling) falling due,
according to the company’s concession, on the 1st January, 1934. The French
gioup professed inability to subscribe further capital, and the financial situation
U ^ eiman y P rec u< ^ e( ^ any contribution from the German interests. Eventually
e amount due was paid in full, the British and Italian groups between them
contributing the necessary funds. The result of this mav well be that the French
and German interests will be eliminated and the position of the British group
, 7 ^ S ! d 1 era + b y stren p tben ed. The company’s operations are still in the experi-
/l age ’ drillm g ls . proceeding at three points. Results hitherto
e , ^ ve not lee T unpromising, but it is too earlv as vet to pronounce on the
prospects of success of the undertaking. ' *
Banking.
Imn^Tttfrn i raq - ° nly 1 th 1 ree esta blished banks—the Eastern Bank, the
entrrplv TUnV v , .® rs1 ^’ Ottoman Bank. The first two of these are
manacZrc; n-P qU U W 16 ^ -d P.ffoman Bank is an Anglo-French concern. The
The Eastern ^ rit U b subjects, as are all their higher-grade employees,
the Ottoman Ttn i T brancb ? s at Bagdad, Mosul, Basra, Kirkuk and Amara,
Persia ^a^Bag^^ 1 and^B^sra^ 5 ^ and the ^P- ial Bank of
Shipping.
practicall^comroW^A ^• erS H ^ or P orat i° n (Limited), constituted after the war,
irin the fl-r r trans P 01 ? s “ on the Tigris, between Basra and
the & Euphrates and Tio-c ^ ason ’ as f ar as Mosul, in their capacity as agents of
&lls ’ eam Navigation Company. The latter "are the aotual