Mr. Hale to Mr. Seward.
Sir: The Pacha and all the ministers of state came from Cairo to Alexandria on the 21st instant. On the 25th was celebrated the festival of Courvan Beiram, when all the members of the consular body were received by his Highness at the palace of Ras-el-Tin, and to-day it is reported that he has already left Egypt in one of his steamers, probably for Constantinople.
The government bureaus were established at Cairo from the 23d of August last until last week, a period of eight months, during which his Highness did not make even the briefest visit to Alexandria or any place in its vicinity.
The principal business of the winter was the negotiation and conclusion of several arrangements relative to the Suez canal. This subject engrossed the attention of his Highness and his ministers to a degree which caused serious embarrassment and delays in the transaction of all other business. It was no doubt to facilitate the completion of these arrangements that Nubar Pacha was named minister of foreign affairs, in place of Cherif Pacha, on the 16th of January, as reported in my despatch No. 51 of that date. The several papers which complete the arrangements in Egypt bear date on the 30th of January, 19th and 22d of February, and on the 19th of March. The whole arrangement received the approbation of the Sultan at Constantinople.
I obtained access to the papers in Cairo, and copies were in course of preparation in my office here for transmission to you, a work which has occupied a considerable time, when all further trouble in this regard is saved by their publication in full in the bulletin of the canal company printed at Paris, two copies of which are sent you herewith.
Instead, therefore, of the voluminous manuscripts which were in preparation, I content myself with a brief statement of the nature of these arrangements, which are regarded as conclusive of the subject-matter in hand as far as it can be affected by diplomacy, and of their relation to the previous condition of the work.
You are aware that the project of piercing the Isthmus of Suez, which divides the westen waters from the inland seas, has previously been viewed with the utmost jealousy by the government of Great Britain, and that no expedient has been neglected on its part which diplomacy could suggest for putting obstacles in the way of the work. Without undertaking to say that there has been any change in the feeling of Great Britain in this respect, it may be affirmed that the death of Lord Palmerston and the recall of Sir Henry Bulwer from his post as ambassador at Constantinople have rendered the application of its policy less active; and Mr. Gladstone is even believed to be favorable to the enterprise.
The work of the Suez canal was begun about ten years ago by M. de Lesseps under a concession obtained by him from the Egyptian government, then in the hands of Saïd Pacha, the predecessor of the present viceroy, Ismail Pacha. This concession was wholly unauthorized by the Porte at Constantinople. The work, if viewed with jealousy by Great Britain, was approved with equal cordiality by France.
The great lever of diplomacy against the canal employed by the former of the Sultan’s western allies and protectors has been to remind him of his position as suzerain while this work was going on, as it was begun without his imperial sanction. But the Sultan has never ventured so far to strain either his authority over the Pacha of Egypt or his good relations with the Emperor of [Page 267] the French as to insist on the discontinuance of the work, and he has now at last given it his formal approval in an imperial firman.
The adroitness of M. de Lesseps has enabled him actually to convert into facilities almost all the embarrassments successively thrown into his way by British interference, and this remark holds good to the last, for in the imperial firman, now granted, he would seem to have obtained a new guarantee for the successful prosecution of his enterprise.
It remains to point out the essential principles underlying the arrangements recently concluded.
You will recollect as the last previous phase of the business, that the questions at issue between the Egyptian government and the canal company (questions no doubt raised by outside interference) had been referred to the arbitration of the Emperor Napoleon, who rendered an award under date of July 6th, 1864. This award, in effect, admitted the objections which had been made to the large concessions of land to the company, and ordered their retrocession to the government; but on the other hand, called upon the Pacha to pay a heavy indemnity for them. It provided that the company should possess no more lands than should be necessary for the legitimate purposes of their work, and undertook to set out the quantity thus necessary with considerable minuteness of detail.
It was soon made manifest that this arrangement would not be suffered to become final without one more effort against the work. It was represented at Constantinople that the company still enjoyed too much land, and the Sultan was again invoked to interpose his imperial authority. In the course of a correspondence which ensued, it is said, however, that it became evident that the Emperor of the French would not allow an arrangement to which he had lent his assistance to be set aside on any trivial grounds, nor would he permit even his imperial Majesty of the Sublime Porte to call in question the competency of the Egyptian government to the extent which the Emperor of the French had seen fit to recognize it, namely, as possessing so many of the powers of an independent government as to be competent to make a concession for a canal and to vary the terms of the original concession on the award of his imperial French Majesty.
The position, therefore, was sufficiently difficult. On the one hand England was against the recognition of the Emperor’s award; on the other, France insisted upon it.
In pursuance, as is understood, of arrangements informally made in private communications, it was agreed in an autograph correspondence between the Sultan and the Emperor that four commissioners, to be appointed, one each by the Turkish, Egyptian, and French governments, and by the canal company, should come to Egypt to mark out upon the ground itself the lands necessary for the purposes of the work. These commissioners arrived in Egypt in January and completed their task by allowing to the company altogether 6,665 hectares of land on the African bank of the canal, and 3,549 on the Asiatic bank, while the quantities allowed in the Emperor’s award had been 6,892 and 3,372 respectively. The total quantity marked out by the commissioners is 10,214 hectares, while the Emperor had awarded 10,264, so that in respect of quantity the award was substantially confirmed.
I understand, however, that while the quantities remain nearly the same, the limits assigned by the commissioners are such as to more strictly confine the canal company to its legitimate business in the enjoyment of its lands, and to prevent any usurpation of the open roadstead in the harbor of Suez.
Meanwhile, by a separate arrangement, negotiated between the Pacha and M. de Lesseps, the canal company retroceded to the Egyptian government the Wady estate, (comprising the scriptural “land of Goshen,”) together with the fresh-water canal leading from Cairo to the isthmus, and thus removed from the [Page 268] arena of discussion two subjects for plausible complaint. For the Wady estate the Egyptian government agrees to pay the canal company ten millions of francs, but by an alteration of the terms of payment in the indemnity previously awarded, this is added so as to make no addition to the capital sum to be paid.
You will not fail to observe the adroitness with which these arrangements, satisfying, or appearing to satisfy every reasonable objection, paved the way for a convention in which no very substantial difference appears from the award of the Emperor, but to which the Sultan might consistently, as he has done, give his imperial consent.
And this result has been attained with the happy incident of pleasing everybody. To begin with, all parties are gratified that an adjustment has been reached, which appears to be final so far as governmental interference is concerned, removing the work from the arena of diplomatic discussion and leaving it on the footing of an ordinary business enterprise. The canal company and the Pacha are, of course, gratified to have an imperial firman confirming their proceedings; nor is the granting of this sanction, for reasons already intimated, now to be regarded with so much disfavor by Great Britain as it might have been formerly. Meanwhile, Colonel Stanton, the British agent and consul general here, acting through the Turkish commissioner, succeeded in incorporating in the arrangements several provisions which I am bound to say are generally in the interest of the commerce of the whole world. As for the Sultan himself, it is not probable that he takes any such interest in the canal as would induce him to view it either with favor or disfavor, and he must be heartily glad to have removed from his court a bone of contention between his two western allies which was perpetually pressed upon his notice in a way to endanger the permanency of the very convenient relations existing between himself and the Pacha of Egypt.
It is on the Pacha of Egypt, as holding the longest purse, that the arrangements press most heavily. Although his Highness receives back the lands generously granted to the company by his predecessor, he pays handsomely for them. The sum total of the engagements of the Egyptian government in respect of the enterprise is no less than thirty-five millions of dollars, at least two-thirds of the whole available means of the company; and if it may be permitted to entertain doubts of the genuineness of the French subscription to its capital stock, the proportion of the cost of the great work thus assessed on the resources of Egypt is even larger, while its benefits, if it succeeds, will be enjoyed at least in large degree by the commercial nations. The Egyptian government, however, is fain to content itself with a confident hope that it may be forever free from any demands for the canal beyond the amounts now settled, and that the company will go into the market as a borrower for the means necessary to complete the work, in case those in hand prove insufficient.
In the negotiation of the convention of 22d February, M. Ruyssenaers, the very able and intelligent consul general here of the kingdom of Holland, is understood to have been largely concerned as a friendly mediator between both parties, and the Emperor of the French has marked his sense of the value of M. Ruyssenaers’s services by conferring upon him the decoration of officer of the legion of honor. Similar decorations were at the same time bestowed by the Emperor upon Nubar Pacha, who signed the convention on the part of his Highness, and also (probably to avoid any probable jealousy) on Cherif Pacha, whom Nubar replaced in the cabinet for this purpose.
Having thus stated the substantial principles which enter into the late arrangements, I forbear a review of the details, which would swell this despatch beyond proper proportions. It may be enough to mention that one clause relating to laborers, without precisely annulling the previous arrangements which prohibited the use of forced labor on the works, is believed to give the company some facilities in the employment of native workmen, and thus relieves it from the [Page 269] most serious drawback which has lately been felt. Other clauses conserve the rights of commerce in the harbors of Port Said and of Suez, and accord to any individual, of whatever nation, with the preliminary authority of the Egyptain government, the right of making an establishment for business purposes upon the canal, and provide that if any differences arise they shall be decided according to the established usages and the treaties, thus preserving the privileges of exterritoriality to foreigners.
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I have the honor to be, sir, very respectfully, your obedient servant,
Hon. William H. Seward, Secretary of State, Washington, D. C.