500.C1112/91: Telegram (part air)

The Consul at Geneva ( Gilbert ) to the Secretary of State

9. Department’s telegram 163, December 31, 4 p.m.2

1. Avenol3 expressed to me today the warmest gratification at the suggestion of the appointment of Grady4 to the League Economic Committee. He stated that his name would be presented to the January Council. Favorable action may be assumed.

2. Upon the constitution of the Committee on Raw Materials Grady will be selected as a member by virtue of his membership in the Economic Committee.

The procedures for the establishment of the Raw Materials Committee are, however, not settled and depend largely on the circumstances discussed below.

3. It remains an open question as to whether the January Council will set up the Committee. It still apparently hinges on British preoccupations respecting Germany. As understood here the British are anxious to avoid the political reactions of (a) not inviting Germany which from present indications would precipitate accusations by Berlin that the Committee was a manifestation of a bloc against Germany, (b) Berlin’s refusal of an invitation were it extended. These issues are regarded as intensified due to the terms of the Assembly resolution clearly envisaging the participation of Germany while technically the members of the Committee would serve in their individual capacities. The foregoing terminology reflects the realistic attitude toward the situation.

The Polish Chargé d’Affaires tells me that from advices from the Polish Ambassador at Berlin the British had not yet approached the [Page 804] Wilhelmstrasse in this question and that the Germans are affecting annoyance at thus being left to one side. I think that perhaps the irritation of the Germans might be due to the change of the project being under the League which they feel it should have been understood would for political reasons render difficult their participation. The Chargé d’Affaires in stressing the interest of Warsaw in this matter disclosed to me that he believed the ultimate aim of his Government was to acquire colonies either directly or by employing the raw materials and migration issues to obtain through Geneva “a new form of mandate with international financial support for development”. Advices here are that Italy’s position is still that of non-cooperation of any League endeavor until Ethiopia be excluded.5 The admission of Egypt by an Extraordinary Assembly has been planned to be used to accomplish this. It has been hoped here that the Assembly might convene simultaneously with the January Council with the thought of bringing Italy immediately into full cooperation. Current advices here are, however, that Cairo insists on tying League membership into the issues of the converted Conference on Capitulations to take place in Montreux in April.6 It would thus appear that Italy would not attend a raw materials meeting if held at an early date.

The whole question of a Raw Materials Committee seems to be so associated with complex European political questions that the outcome is highly problematical.

Avenol confirmed to me the essentials of the foregoing. He stated that he was exerting every pressure on the British to set the raw materials project in at least some form in the January Council.

  1. Ibid., p. 485.
  2. Joseph Avenol, Secretary General of the League of Nations.
  3. Henry F. Grady, former Chief of the Division of Trade Agreements, Professor of International Trade and Dean of the College of Commerce, University of California, Berkeley, Calif. On January 25, the League of Nations Council appointed Mr. Grady member of the Economic Committee.
  4. For correspondence relating to the Ethiopian-Italian conflict, see Foreign Relations, 1936, vol. iii, pp. 34 ff.
  5. See vol. ii, pp. 615 ff.