Paris Peace Conf. 180.0501/23

Supreme Economic Council: Twenty-third Meeting Held at the Ministry of Commerce on 16th June, 1919, at 3 p.m.

The Supreme Economic Council held its Twenty-Third Meeting on Monday, 16th June, 1919 at 3 p.m. under the Chairmanship of Monsieur Clémentel.

The Associated Governments were represented as follows:—

United Kingdom: Sir Wm. Mitchell Thomson,
Sir Wm. Goode,
Mr. Barrie.
United States: Mr. Hoover,
Mr. McCormick (part time)
Mr. Gordon,
Mr. L. L. Summers.
France: M. Claveille,
M. Seydoux.
Italy: Commendatore Attolico,
Captain Lazzerini.
Belgium: M. Jaspar,
M. de Cartier de Marchienne.

214.

The Minutes of the Twenty-Second Meeting were approved subject to the addition of the following paragraph to Minute 205:—

“They explained, however, that some negotiations had been taking place, with the full knowledge of the Food Section, for the provision of foodstuffs for delivery as soon as the blockade was removed.”

With further reference to Minute 205, the Italian Delegates reported that Baron Sonnino was himself making enquiries regarding the reports of the passage of commodities from the Adriatic to Hungarian Bolsheviks.

215. Italian Coal Situation.

With reference to Minute 204 the Italian Delegates reported a meeting between the French and Italian Representatives when the French had agreed to submit as soon as possible definite proposals regarding the supply of German coal to Italy for a period of six months after Peace.

216. Work and Organisation of the Council.

With reference to Minute 207, it was agreed that the next Meeting of the Committee on Policy appointed by the Council at the Twenty [Page 364] first Meeting should be held on Saturday 21st June at 3 p.m. at the Ministry of Commerce.

217. Re-Imposition of the Blockade on Germany.

A Note (193) recording the decisions of the Council of Heads of States regarding the preparation to be made for the re-imposition of the blockade on Germany should the occasion arise, and a draft Minute from the Blockade Section (194) regarding the administration of these blockade measures, were submitted.

The American Delegates stated that they desired, on behalf of their Representative on the Blockade Section who was unable to be present, to make a reservation regarding the Minute of the Blockade Section which, in its present form, the American Delegates were unable to accept.

The British Delegate on the Blockade Section pointed out that, in his view, it would be impossible for the executive conduct of the Blockade, so far as the Northern Neutrals were concerned, to be carried on except by the Allied Blockade Committee in London.

The Council noted the resolution and referred it back to the Blockade Section to give the American Delegates an opportunity of setting forth any alterations in the text which they desired to recommend.

218. Private Trade Relations With Germany.

A Note from the Sub-Committee on Germany (195) suggesting that the competent authorities of each of the Allied and Associated Governments should decide and communicate to the other Governments whether or not they would permit their nationals to resume trade relations with Germany within the limits allowed by the Blockade was submitted and approved.

219. Finance of German Coal.

Owing to the unavoidable absence of certain of the French Delegates, and the impossibility of arranging a special Meeting of the Council during the week, it was agreed that all discussions regarding the financing of German coal supplied to the Allies should be postponed until the next Meeting of the Council.

220. Finance of Austrian Food Supplies.

With reference to Minute 209 certain decisions reached at a joint Meeting of the Finance Section and the Committee of the Food Section held on 14th June (196) regarding the application of the loans already made by the United States Treasury to the United Kingdom, France and Italy for the supply of foodstuffs to German Austria and the contemplated provision of a further loan for the same purpose, were reported and approved.

The French Delegates stated that they had already requested their Government to agree to the increase of the balance of the revolving [Page 365] fund referred to in Minute 209 from 100 million to 120 million francs and that they anticipated that the matter would be satisfactorily settled in a few days.

221. Export of Gold and Securities From German Austria.

The British and French Delegates on the Blockade Section referred to reported shipments of gold and securities from German Austria to Germany and Hungary and suggested that steps should be taken immediately to control the export of these commodities from Austria and that the Blockade Committee at Vienna should undertake this control.

It was agreed:—

(a)
that the French Delegate on the Blockade Section should prepare a cable for despatch to the Blockade Committee at Vienna informing them that the export of gold and securities from, and import to, Austria are prohibited except under licence to be granted by the Blockade Committee;
(b)
that the cable should be submitted for approval to the remaining Delegates on the Blockade Section before despatch.

222. Cotton for Poland.

A cable received from the Representative of the American Relief Administration at Hamburg on 12th June (197) reporting that the German Government were unwilling to allow the shipment of cotton to Poland through Dantzig unless they were acceded a portion of the cotton was submitted and deferred for consideration at the next Meeting of the Council, if necessary.

223. Allied Economic Policy in Russia.

With reference to Minute 212 a note from the Food Section dated 14th June (198) was submitted and deferred for detailed consideration pending the receipt of reports from the other Sections.

Appendix 1931

Decision of the Council of the Principal Allied and Associated Powers at a Meeting Held on the 13th June, 1919 [Regarding] Reimposition of the Blockade 2

The Council of the Principal Allied and Associated Powers have considered the note of the Superior Blockade Council, dated the 11th June, 1919 (attached).

They have decided that the Blockade Council should make every preparation for the reimposition of the blockade, but that its actual [Page 366] enforcement should not be undertaken, even in the event of the refusal by the Germans to sign the Treaty of Peace, without a decision from the Council of the Principal Allied and Associated Powers. No actual threat should be made public that the blockade is to be reimposed, but, short of this, steps should be taken to give the public impression that preparations are in hand. If practicable, these steps should include the despatch of destroyers to show themselves in the Baltic.

  • W. W.
  • G. C.
  • D. Ll. G.
  • S. S.
  • N. M.

[Enclosure]

Note To Be Transmitted to the Council of Heads of States

1.
The Superior Blockade Council have the honour to recall to the Council of Heads of States that no decision has yet been taken as to the application of further economic pressure upon Germany should she refuse to sign the Peace Terms.
2.
The Council venture to point out that while, in accordance with the instructions of the Council of Heads of States, they have endeavoured to bring the various parts of the blockade to the most advanced state of readiness, the whole machine is so complex that it requires some time to set it actually in motion.
3.
These preparations have now reached a point beyond which the Council feel that they are not justified in proceeding so long as it remains doubtful whether it is intended, in case of necessity, to make use of the machine or not.
4.
The Council therefore submit, as a matter of urgency, that the time has now come when the Council of Heads of States should arrive at a definite decision as to whether it is the intention to make use of a reinforced blockade as a measure of pressure upon Germany in the event of a refusal to sign the Peace Terms.

Appendix 194

[Minute From the Blockade Section Regarding] Administration of Blockade Measures in the Event of the Reimposition of Blockade

During the course of the discussion recorded in the foregoing minute, the question arose as to what body should be made responsible for the [Page 367] administration of blockade measures if the blockade were to be re-imposed. It appeared evident to the Council that the Allied Blockade Council are in the best position to administer all blockade measures affecting northern neutrals, and the following resolution was accordingly adopted:—

Resolved,

“That, should Germany refuse to sign the terms of Peace, the Council entrusts to the Allied Blockade Council in the case of the northern neutrals the duty of taking from time to time the necessary executive action to give effect to any decisions arrived at by the Council of Heads of States regarding the application of further blockade pressure upon Germany.”

Appendix 195

Note by the Sub-Committee on Germany Regarding Resumption of Trade Relations With Germany

With reference to the general question of the resumption of private trade relations with Germany, the Sub-Committee on Germany makes the following remarks:—

1.
It is a question for the competent authorities of each Allied and Associated country to decide whether or not they will permit their nationals to resume trade relations with Germany within the limits allowed by the blockade.
2.
It is desirable that in the event of any Allied or Associated country granting this permission to its nationals the other Allied and Associated countries should be informed.

Appendix 196

At a joint meeting of the Finance Section and Committee of the Food Section, held on the 14th June, the following decisions were reached:—

1.
American Treasury advances of 15,000,000 dollars each to Italy, France and England are solely for dollar purchases and expenditures in provision of food for German Austria.
2.
Mr. Davis will recommend an additional advance of 1,000,000 dollars to each of the three Allied Governments, which the Relief Department estimates will be required to complete programme to harvest in addition to supplies from the Banat.
3.
The supplementary expenditure, which is non-dollar expenditure, on transport, &c., shall be borne equally by France, Italy, and England.
4.
The programme attached shall be loaded by the Wheat Executive, and an adjustment of all accounts between the three Governments shall be made on completion of this programme.

[Enclosure]

German Austria: Expected Arrivals to July 31, 1919

Steamships Tonnage Value f. o. b. New York Estimated Operating Cost ex-Austrian Steamers Total
Tons Dollars Dollars Dollars
Africana 4,689 431,388 70,335 501,723
Szenternetzi 4,169 463,430 62,535 525,965
Dubac 4,077 453,393 61,155 514,548
Maria Immaculata 4,909 603,260 73,635 676,895
Adriatica 4,939 567,635 74,085 641,720
Cat. Goromomich 6,623 649,268 99,345 748,613
Kossuth Ferencz 6,500 822,250 97,500 919,750
La pad 3,600 442,750 52,500 495,250
Graf Tisza Istvan 3,600 455,400 54,000 509,400
Atlantica 4,600 569,250 67,500 636,750
Radium 4,600 569,250 67,500 636,750
Dardania 4,700 594,550 70,500 665,050
Irvor 6,600 708,400 84,000 792,400
Emilia 5,000 632,500 75,000 707,500
Graf Hedervrav 6,000 759,000 90,000 849,000
Istiva 5,600 695,750 82,500 778,250
Georgia 8,000 1,012,000 120,000 1,132,000
Ellenia 7,300 923,450 109,500 1,032,950
Boéme 6,500 822,250 97,500 919,750
Marianne 5,400 683,100 81,000 764,000
Clumechan 5,200 657,800 78,000 735,800
Iskra 6,050 765,325 90,750 856,073
Grand total 117,256 14,281,399 1,758,840 16,040,137

Appendix 197

[Telegram From the American Belief Administration at Hamburg Regarding Shipments of] Cotton for Poland

The following telegram from Colonel Coombs, American Belief Administration Representative at Hamburg, was received on the 12th June:—

“German Government not willing to allow shipment of cotton to Poland through Danzig unless they get portion. Their idea is 10 per cent., to cover transportation charges and as payment for privilege of passage through this country. Coombs.”

Appendix 198

Report From the Food Section [Regarding] Allied Economic Policy in Russia

In accordance with instructions received from the Supreme Economic Council, the Food Section at the sixteenth meeting held on [Page 369] the 11th June considered what measures might be necessary as regards food supplies to Russia in the event of a decision to include Russia in the sphere of operations of the Supreme Economic Council.

It was decided that should commercial relations with the whole of Old Russia be re-established it would be impracticable, because of the limited transportation facilities from the ports inland, to endeavour to execute a programme in excess of 100 thousand tons a month, amounting to an expenditure of approximately 150 million dollars a year.

The Food Section desire to point out, however, that should it be possible materially to improve the railroad facilities in Russia, a much larger quantity of the food supplies in the interior could be made available for the districts nearer the coast, and the need for supplies to be imported by sea would thereby be correspondingly decreased.

  1. Appendixes 193 to 198 are filed separately under Paris Peace Conf. 180.0501/35.
  2. See CF-63, minute 3, vol. vi, p. 371.