Papers Relating to the Foreign Relations of the United States, The Paris Peace Conference, 1919, Volume XII

Paris Peace Conf. 184.01102/216

Lieutenant Colonel Sherman Miles to Professor A. C. Coolidge

Report No. 16

Fiume, 15 March, 1919.

Sent, by direction, straight to Paris, because of direct courier service.³¹ One copy sent to Professor Coolidge, Vienna.

Subject: Fiume (supplementing my report No. 15, of March 9th³²).

1. Since writing report No. 15, I have spent another week in Fiume and Pola, and have been able to get more extensively the views of the “Independence Party” in Fiume and of ex-officers of the Austrian Navy, as well as of the two extreme parties (Italians and Jugo-Slavs).

2. The salient feature in the Fiume situation is the desire of the people for a more or less autonomous form of government. The degree of autonomy proposed varies from the complete independence under international guarantee, which is the desire of many Fiumans, to the limited form of a “free port” under the mandatory of either Italy or Jugoslavia. The point is that apparently no one, except the national propagandists who have no local interests, desires the absolute incorporation of Fiume into either the Italian or the Jugo-Slav state. So far as I can determine, this desire for local autonomy is founded, not so much on the traditions of the past (though Fiume has always been more or less independent), but on economic considerations. The fear in the mind of everyone interested is that the port will be starved if given over entirely to one state or the other. The local desire of the people concerned therefore accords with the economic factor in the problem of Fiume, for the prosperity of the port will be the measure of its economic usefulness to the hinterland which it serves.

3. It is significant that the “Independent Party” (the Fiumans who want complete local autonomy) prefer the Jugoslav to the Italian flag. Their stand is—complete independence if possible, but anything rather than Italian government. They are convinced that, under Italy, even under mandatory as a “free port”, the trade would greatly diminish—which is the same thing as saying that Fiume could not long be the port of Jugoslavia and Hungary.

4. There is in Fiume a Scotchman, a director in a large shipping firm, who has lived here 36 years and is thoroughly informed on all economic questions both of Fiume and of the Dalmatian coast. This gentleman keeps out of politics altogether. I went to see him, and asked him if he would discuss the commercial situation with me. This he agreed to do, in confidence. His views are that there can be no commercial future for Fiume under the Italian flag, even if guaranteed as a “free port”. Under the Jugoslav flag, he thinks that politics would continue to disturb the commercial situation, but that the port of Fiume could continue to serve Jugoslavia and the lands beyond. He dwells on the fact that it is Jugoslavia and Hungary that Fiume serves, and not Italy (except as a port of export for lumber going to Italy). If Fiume became Italian, Italy would have neither the means nor the desire to foster its trade, while Jugoslavia would have the strongest reasons for building up Spalato as quickly as possible and for shifting the trade there. He says that before the war Spalato was already taking some of the trade from Fiume, and that it is capable of taking much more when developed and connected by railroads with the interior. But this development will take some time; and while it is being done Fiume is necessary for Jugoslavia if that state is to thrive commercially. After Spalato is developed, Fiume will still thrive, he thinks, on through trade and on trade built up deliberately with the view of discounting the Spalato competition. Like all Fiumans outside of the nationalistic cliques, his real desire is to see Fiume completely independent of both Italy and Jugoslavia, under international guarantee.

5. The contentions of the leading pro-Italians in Fiume are interesting. They may be summarized (with the Jugoslav counter-arguments) as follows:

a) The pro-Italians minimize the importance of the Hungarian trade. They say that Fiume was independent of this trade, and can so remain. They say that the Hungarian export trade fell off very considerably in the years before the war. This the Jugoslavs deny. The pro-Italians say that the imports into Hungary before the war were considerable, but they cannot see any hope of reviving this trade in the near future because of the poverty of Hungary. Since these same people also minimize the importance of the Croatian trade, their contention would seem to amount to a denial of the commercial future of Fiume, in which the pro-Jugoslavs agree with them if the port is to be under the Italian flag.

b) The pro-Italians emphasize the point that Venice, Trieste and Fiume complete each other. Ships going to one port complete their deliveries or their cargoes at the others. Fiume without Trieste, they contend, would have a very hard time. Hence the importance of having all three ports under the same flag. To this the pro-Jugoslavs reply that large ships usually have to call at several ports anyway, and that the argument is really on their side, since only by separating Fiume from Trieste administratively can competition be stimulated.

c) While the pro-Italians wish Fiume to go to Italy, they insist that it should be a “free port”, since only in this way, they think, can it serve the trade of the hinterland. In this the pro-Jugoslavs agree with them, except that they say that it can never be free under Italy, but only under Jugoslavia. Both sides dwell on the intolerance of the other—and personally I am inclined to agree with both. Certainly the present Italian policy, all along the Istrian and Dalmatian coast is not only intolerant but almost openly hostile towards the Jugoslavs, and not much more can be said for the liberality of the other side.

d) The pro-Italians admit that much of the property in Fiume is owned by the Croatians, but contend that this is because the latter have made money during the war and have been able to buy up property. The pro-Jugoslavs say that the Croatians have always owned a large part of the property, and that they have not, proportionately, made more money during the war than have the Italian traders. Both sides cite incidences of men on the other side who have made a great deal of money out of the war. The truth seems to be that the Italians here are mostly the small traders and shop-keepers. Most of the banking and shipping property is in the hands of the Hungarian banks, but the Croatians own much more of it than do the Italians.

e) The pro-Italians say that the Hungarians are now selling out their interests in Fiume to the Italians. The pro-Jugoslavs fear that negotiations to this effect are now on, but contend that this has nothing to do with the case. The Hungarian banks, largely in the hands of Jews, are anxious to sell their Fiume property because they fear that it is going to Italy and will be lost commercially.

6. As I pointed out in report No. 15, the officers of the former Austrian Navy are probably the best judges as to the question of a Jugoslav port lower down the coast to replace Fiume. These men are relatively impartial and they have an intimate knowledge of the coast. When the question is raised, all of them I have so far met strike first on the hard facts of the case—that Fiume, while a small harbor, is nevertheless a prepared port, with loading facilities, railroad connections, repair shops and even a plant capable of building the largest ships, and that there is no other harbor on the Dalmatian coast having anything like these advantages, nor the possibility of having them in the near future. The opinion seems to be unanimous that Spalato, or more properly speaking the large body of water called “Canale Castelli” west of Spalato, is the only place at which a Jugoslav port to replace Fiume could be built. The harbor of Spalato itself is too small for any great commerce; but I have found some ex-Austrian naval officers who are strong believers in the future possibilities of Canale Castelli. They say that the “bora” is not so strong there, and it can be controlled by breakwaters built at relatively moderate expense, and that the extent of the harbor and depth of the water are ideal for a great commercial port. It also has a certain amount of coal (medium grade) in the vicinity. Against these advantages must be set the great difficulties of railroad construction into the interior, across the Dinaric Alps. Fiume has comparatively easy rail access to the upper valley of the Save, and through that valley it can serve most of Jugoslavia and Hungary. This is of course the outstanding feature of the economic situation so far as Jugoslavia is concerned— that Fiume is prepared to serve as a port and that there is no other in sight for many years to come, and then only after great expense has been incurred. The Italians are always inconsistent in their contention that Jugoslavia is financially incapable of running Fiume and at the same time proposing that the Jugoslavs go to the enormous expense of building a new port at Spalato.

7. I append hereto (Annex “A”³³—1 copy only) arguments presented by several of the leading pro-Jugoslav merchants of the town. The point brought out by them that nationality in Fiume is poorly defined is certainly true. I have run into numerous cases in which families were divided. In fact the leading men of the opposing sides are father and son. I also think that the writers of this paper are correct in saying that the Hungarian authorities favored the Italians over the Jugoslavs and, to a certain extent, artificially Italianized the town. They are certainly right in saying that the commercial interests of the port by far outweigh the question of self-determination of the town. Their point that the hinterland which the port serves is Slav and Magyar, and not Italian, is of course an established fact. Their interferences [sic] that the port should therefore go with its hinterland, and that Italy wishes only to starve it for the benefit of Trieste, appear to be difficult contentions for the Italians to answer. The estimate of the writers that it would take 30 years to develop Spalato to the point of being able to replace Fiume as the port of Jugoslavia, is, of course, merely an estimate, based on unknown financial conditions of the future. It is undoubtedly true, however, that much money and time would be necessary for the development of Spalato; and I believe that it is also true that the Ogulin-Knin railroad has more of a strategic than commercial importance. Their last point, that 70% of the capital invested in local enterprises, especially in shipping, is Jugoslav, is probably an exaggeration; but it is certainly true that there is much more Croatian capital invested, and much more Croatian management involved, than Italian.

. . . . . . .

Geographic and Strategic Considerations as to Frontier.

11. If Fiume is made a free port under Jugoslav mandatory (which I believe is by far the best solution, short of complete internationalization), the Jugoslav-Italian frontier should certainly be run at least as far west as the Tschitschen Boden, (or Mt. della Vena), those sharply defined and barren hills which cut across the northeastern corner of Istria. Any frontier nearer to Fiume than these hills would give the port no “breathing space”, and would cut off one of its two railroad lines into the interior. If strategy must be considered as a factor in the frontier question, the Tschitschen Boden is even less than the minimum necessary for the protection of Fiume. From this point of view the line should be drawn somewhat below (southwest of) the crest of the Tschitschen Boden, since an Italian foothold on the crest would mean direct observation over the Gulf of Fiume and consequent ability to bombard the port; while Jugoslavian possession of the crest, at least as far northwestward as the Brest–Danne–Vodice road, would not by any means give the Jugoslavs corresponding advantages over Trieste or Pola. The Tschitschen Boden is, in other words, the last defence of Fiume, and the capture of almost any point on its crest along the elbow west of Fiume might well make the port untenable (a situation very similar to 203 Meter Hill at Port Arthur). On the other hand, the Tschitschen Boden is not necessary to the defence of Trieste or Pola. (Save in the sense that it does control a portion of the Trieste–Pola railroad).

12. From the geographical point of view the frontier line I should suggest would begin on the south at that point of land on the Canale di Farasina, about 3 kms, southeast of the village of Fianona, thence north along the watershed through Mt. Maggiore (1396 meters), thence north along the watershed of the Tschitschen Boden to some point near the village of Matteria, thence northward over watersheds (so far as possible) between the Gulf of Trieste and the Laibach–Fiume railroad; as shown on accompanying map of Istria.³⁴

13. If strategical considerations must be taken into account, I believe that the above line should be modified by pushing that part of it that runs along the Mt. Maggiore spur and the Tschitschen Boden, an average of about 4 kms to the southwest of the watershed, as shown on accompanying map of Istria.

Sherman Miles

31. Received on March 21.
32. Not printed.
33. Not printed.
34. Map not reproduced.