File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎123v] (251/1150)

. tt was engaged on. the Nisibin section when the armistice was
Taurus, for instance, tie w as e g g Britigh and the French troops of occupation
declared. He subsequen y P j until he succeeded in falling into the lias
the railway, and, later, the Turfcs,unt the reput ' '' '
operate
mm cj-n - _ the licindg
i ’u er M Mavrogordato has the reputation of being extremel,
of the Greeks at E s ki S hehr. M. H g ^ rieuce of onental psychology
capable and altogether unscrupuim
doubtless stand him in ® ® ad of tte con t r act itself, it may be well to touch outlie
Before discussing the te ; n the'Persian Government’s employ. Owin»
work achieved by tl ! e ^^tion Ind the curtailment of funds, very little has beet
to the uncertainty ot the situ ar (ofst March). Up to then the Americat
e^rhSspe^COotoOO tomans 10,000 Persian dinars, or a gold coin of that value. (£120,000-130,000) as follows
Survey 190 000 tomans 10,000 Persian dinars, or a gold coin of that value. ,' comprising 5,500 kilom. reconnaissance, 1,500 kil„ ffl ,
preliminary surveys^400-o00^il<ffliMocation su^rveys.^
Construction, ^J.UUU tomcins lUntiammorah Bandpr-i n 07 \
Port investigation, 60,000 tomans 10,000 Persian dinars, or a gold coin of that value. (at Khor Musa, Moiiammer , ander i-bez).
Tools and equipment, 125,000 tomans 10,000 Persian dinars, or a gold coin of that value. .
The salaries of the American engineers are included in these amounts. The
figures are M. Bouillon’s. The latter claims that work of this nature has never b«
done cheaper at any time and in any part of the world.
The syndicate had very good reasons for making light of the work hitherto
accomplished by the American Railway _ Mission, and according to all accounts
Mavrogordato has been very successful in his campaign of disparagement rticle Gof
the contract stipulates that the value of the plans and data collected by the American
engineers would be determined by friendly agreement and the amount deducted from
the sum payable to the contractors on account of the survey. It is clear,,moreover,
that if the syndicate could persuade the Persians that the Railway Mission s estimate
for the cost of completing the survey w T as for second-class work, it might itself pitcn
its demands very much higher. Actually, the Railway Mission’s figure was 250 tomans 10,000 Persian dinars, or a gold coin of that value.
per kilometre over the whole line. The syndicate asked for and obtained 368 tomans 10,000 Persian dinars, or a gold coin of that value. per
kilometre for a minimum of 1,300 kilom. (subject to the observance of article 6). It is
possible that the American figure is an under-estimate, but there is no doubt that the
syndicate will make a handsome profit on the survey.
Even better business for the syndicate should result from the construction—should
the Persian Government decide thereon—of 150 kilom. of railway at each end. It will
be especially noted from the attached copy of article 5 of the contract that in that
event the syndicate will be given a commission of 10 per cent, not only on the cost of
construction, but also on all the equipment and rolling-stock required to put these
experimental sections of the line into operation.
We have perhaps insufficient reasons at this stage for accusing the German
partners in the syndicate—Ulen are said to be a first-class and reputable firm—but the
fact must not be lost sight of that the more it costs the Government to have these
trial sections constructed, the better the chance of the syndicate to secure the final
contract for the construction of the whole of the line. Other competitors will have no
other basis on which to tender than the published cost of construction to the
Government and some quite superficial surveying while the greater the syndicates
profit the broader the margin, which will enable it to undercut rival tenders. This is
on the supposition that for the contract the Government will no longer be content to
pay for construction on the cost plus commission principle. Whatever happens,
syndicate, if its tender is as low as the lowest rival tender, will have a priority claim jo
employment. It seems a foregone conclusion indeed that the syndicate will eventually
be called upon to complete the railroad should the Persian determination to have h at
all cost not waver and a financial or other serious obstacle not intervene. From t e
technical point of view the present contractors could hardly be surpassed. From the
financial standpoint the present arrangements could certainly be improved upon- s
M. Bouillon said to me : “ The syndicate will build the Persians a first-class railroad,
but it will be a darned expensive one.”
I he conti act under review is a document of some eighteen pages. r Fh e LegatM
is on ^ m possession of one copy, but others could be made if necessary. P 01115
ol interest other than those already mentioned are the following
(a.) Ahwaz is mentioned as the southern terminus of the railway.
It may
• J ^ uxxoj. 11. LC/i. illli_i LLo G/X L-LJLw X Cvl-L vy •
mentioned m this connexion that the American Railway Mission are
opinion that the cost of making a port at Khor Musa and of joining
of tP e
it to

File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎123v] (251/1150)

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File 357/1919 Pt 2 ‘RAILWAYS IN PERSIA’ [‎123v] (251/1150)

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