Papers of the War Cabinet's Eastern Committee [‎70v] (140/544)

2
Shipping Between
Akaba and Jeddah.
Anglo-French
Agreement of 1916.
five to one. Both India and Egypt had given all possible assistance,
the former by providing bills and drafts lor getting back gold from
Jeddah, and the latter by supplying gold out of her own slender
resources, which were now becoming exhausted.
Sir Alark Sykes, in reply to a question as to what became of the
large quantities of gold which we had sent to the Hejaz, said that a
certain amount of it drifted up to Turkey, but the greater part was
probably hoarded. The payment of the subsidy in gold maintained
our prestige, and he deprecated any alternative which might aiTect
this adversely. He suggested the creation of a smaller gold currency,
and further, that part of the subsidy might be paid in kind, viz., in
sugar and cotton, if tonnage could be found fpr the latter. There
was a general shortage of silver, or part of the subsidy might be paid
in that currency. It was possible that we might eventually have to
increase the present subsidy, but he did not see any necessity for
paying it all in gold. Whatever happened, it was most necessary
that the King of the Hejaz should on no account suspect that we
were short of gold.
Mr. Montagu thought that there could be no question of reducing
the subsidy. He agreed, however, that some of it should, if possible,
be paid in kind. He doubted whether the King would be prepared
to accept notes, which might be as unpopular among the Arabs as
they were with the Indian Ryots. He suggested that Colonel W ilson
should be asked to make discreet enquiries, and let us know whether
the King would accept part payment in kind.
The Committee decided—
That the Foreign Office, in consultation with the 1 reasury, should
telegraph to Sir F. Wingate stating that the continued
despatch of gold bullion on so large a scale to the Llejaz
is most undesirable if it can by any means be avoided, and
inquiring as to the steps which might be taken both to meet
the subsidy otherwise than in gold and to increase the
amount of gold recoverable from Jeddah.
■2. Mr. Keynes said that last May the Admiralty had agreed to
put on one boat to ply between Akaba and Jeddah. It now appeared
desirable to try and increase the trade between these two ports, with
a view more especially to recovering gold from Jeddah, and it was
proposed to ask the Admiralty to permit a second boat to be
diverted to this trade, and the Treasury, in proffering this request,
desired to have the support of the Eastern Committee.
The Committee approved that, when the Treasury approached the
Admiralty on the subject, their letter should state that the
Eastern Committee attached importance to the diversion of
a second ship to this trade route.
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3. The Committee resumed the discussion of the Anglo-French
Agreement of 1916, adjourned from the previous meeting (E.C.,
20th Meeting, Minute 2), and had before them the memorandum by
Sir Mark Sykes (E.C.-825) (Appendix).
The Chairman said that at their 18th Meeting (Minute 3) it had
been stated that the War Cabinet had decided that when a civil
administration was set up in Palestine, M. Picot should be associated
with us in it. lie had said at the meeting that he had no recollec
tion of any such decision, and, alter consulting the records, all that
he had been able to trace in this connection was that at an Anglo-
French Conference in December 1916 (I.C.-13) the British Govern
ment had agreed that when the British entered Palestine, a French
Moslem detachment should be associated in the operations, and a
French political officer should be attached to the British Commander-
in-chief. So far, therefore, as Palestine was concerned, there had
been no pledge of French participation in the civil administration.
Turning to Sir Mark Sykes’ memorandum, the Chairman said
that the gist of it was contained in the following passage, to the