462.00 R 296/669: Telegram
The Chargé in France (Whitehouse) to the Secretary of State
452. L–240, from Logan.
(1) I should like to be advised of Department’s position on the following subject which is likely to come up at financial conference for consideration.
(2) By article 232 of Treaty of Versailles, Germany assumes Belgium’s war debt to the Allied and Associated Powers. Our pre-armistice claim against Belgium together with accrued interest is understood to be approximately $200,000,000. On June 16, 1919, President Wilson, Premier Clemenceau, and Prime Minister Lloyd George signed a letter agreeing to recommend, each to his own Government, the acceptance of German bonds in satisfaction of Belgium’s obligation.61 The proportion was to be about 40 percent to Great Britain, 40 percent to France and 20 percent to the United States.
(3) By the Finance Ministers’ Agreement of March 11, 1922,62 the United States, France and Great Britain by article 10 were to receive a portion of A B C bonds in satisfaction of their claims against [Page 67] Belgium, the agreement as far as the Government of the United States is concerned being subject to its approval. The Belgians informally advise that they interpret this agreement of March 11, 1922, to mean that Great Britain and France have definitely abandoned any effort to require Germany to pay any sum for Belgian debt in addition to the 132 billion gold marks total reparation payment, accepting a special block of the ABC bonds instead.
(4) At the financial conference soon to be held I have been given informally to understand that the Belgians will suggest that there be set aside 5/137 or perhaps 5/132 of each annuity for the service of the Belgian debt. In view of uncertainty of the future action of the United States, it is probable that they will ask that portion that otherwise would go to the United States should be paid to Belgium to be held by that Government either for itself, if it has to pay the United States directly, or as the trustee for the United States should our Government decide to carry out unratified agreement of June 16, 1919.
(5) I assume that Department’s position is that Belgium still owes us the debt, that we have not received it, and that we have not accepted Germany’s liability in place of Belgium’s, but that we are not inclined to press the claim at this time. If we were to accept Germany’s liability, it would mean an additional claim against her of 800,000,000 gold marks.
(6) From, the Belgian point of view it is undesirable that we formally state our position at the conference should question arise, for Belgians fear that should United States say at the outset that payment is expected, Great Britain and France may say in view of changed conditions that Finance Ministers’ Agreement of March 11 is not binding on them either, especially as it has never been ratified by French Parliament. It is desirable from our point of view, of course, to aid the Belgians as much as possible, as we shall need their help in obtaining recognition of our right to participate in the Dawes Plan annuities. Should question arise it seems that it would be better to say that we are studying matter, that we are aware of equities of Belgium’s position, that this Government is not inclined to press for payment while general situation is under consideration, and that in meantime we would prefer that France and Great Britain go ahead as if we had no connection whatever with matter.
(7) I shall appreciate Department’s advice if it is not in accord with the foregoing statement of facts and suggestion. Logan.
- Telegram in two sections.↩
Text of the letter printed in S. Doc. 413, 66th Cong., 3d sess., reads as follows:
↩June 16, 1919.
M. Hymans,
Ministre des Affaires Etrangères, Hotel Lotti, Paris.Sir: The Reparation Clauses of the draft Treaty of Peace with Germany obligate Germany to make reimbursement of all sums which Belgium has borrowed from the Allied and Associated Governments up to November 11, 1918, on account of the violation by Germany of the Treaty of 1839. As evidence of such an obligation Germany is to make a special issue of bonds to be delivered to the Reparation Commission.
Each of the undersigned will recommend to the appropriate governmental agency of his Government that, upon the delivery to the Reparation Commission of such bonds, his Government accept an amount thereof corresponding to the sums which Belgium has borrowed from his Government since the war and up to November 11, 1918, together with interest at 5 per cent unless already included in such sums, in satisfaction of Belgium’s obligation on account of such loans, which obligation of Belgium’s shall thereupon be cancelled.
We are [etc.]
G. Clemenceau
Woodrow Wilson
D. Lloyd George”
- See “Agreement between Great Britain, Belgium, France, Italy and Japan respecting the Distribution of German Reparation Payments.—Paris, March 11, 1922,” British and Foreign State Papers, 1922, vol. cxvi, pp. 612 ff.↩