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

Paris Peace Conf. 180.0501/8

Supreme Economic Council: Eighth Meeting Held at the Ministry of Commerce [on 17th March, 1919, at 10 a.m.]

March 17, 1919, 10 a.m.

The Supreme Economic Council held its Eighth Meeting on Monday, 17th March, 1919 at 10 a.m. under the Chairmanship of M. Clémentel.

The Associated Governments were represented as follows:—

Great Britain	Lord Robert Cecil,
	Sir W. Mitchell Thomson,
	Mr. Keynes,
	Sir H. Llewellyn Smith,
	Mr. E. F. Wise.
U. S. A.	Mr. McCormick,
	Mr. Hoover,
	Mr. Norman Davis,
	Mr. Baruch.
France	M. Loucheur,
	M. Boret,
	M. Vilgrain.
Italy	Signor Crespi,
	Signor Ciuffelli,
	Professor Attolico.

42.

The Minutes of the Seventh Meeting were approved.

43. Conference With German Delegates at Brussels.¹

1. Food. At the request of the assembled Delegates Mr. Hoover reported briefly on the decisions reached at Brussels as regards the supply of food to Germany and referred particularly to the following:—

(a) that no restriction should be placed on the import into Germany of fish caught in European waters or on the import of vegetables from Neutral Countries.

(b) that the present restrictions upon German fishing in the Baltic would be removed immediately and the removal of restrictions on German fishing in the North Sea would receive immediate consideration.

(c) that the German Government would accept the Allied invoices as final in respect of quantity, quality and value of foodstuffs provided to Germany.

2. Finance. The British Financial Delegate drew attention to the following points:—

(a) Coal. The German Delegates had agreed that it was essential to increase the amount of coal available for export from Germany and would prepare a technical report indicating the quantity of coal which could be exported and details of the materials required to restore the mines to working order.

(b) Payment of food. The German Delegates had pointed out that the means of payment for food proposed by the Associated Governments would not be sufficient to meet the programme to the end of the Cereal Year and had asked that the question of loans might be considered later, if necessary.

(c) That immediate consideration would have to be given to the method of dealing with requisitioned German securities and suggested that a sub-committee should be appointed for the purpose.

It was agreed:—

1. that the detailed reports of the Conferences at Brussels should be:—

(a) distributed to all the Delegates for their consideration.

(b) referred to the various Sections to consider and recommend to the Council what constructive action was necessary to administer the agreements reached with the Germans.

2. that a special Meeting of the Council should be held on Friday 21st March at 10 a.m. to receive full reports from the Sections.²

3. that as regards Clause (c) above the appointment of a Sub-Committee should be formally approved.

The French Delegates undertook to ascertain whether the Meetings of this Sub-Committee with German Delegates might be held in Paris or Versailles.

44. Trade With German-Austria.

A Report from the Blockade Section (30) embodying proposals for establishing methods of control in case of the resumption of trade with German Austria was submitted. The Italian Delegates having withdrawn their reservation made on this subject, the report was approved subject to an amendment to Article 3 which should read as follows:—

“The re-exportation by Austria and Hungary to Germany of all imported commodities shall be forbidden except under special authorisation of the Inter-Allied Commission at Innsbruck.”

It was agreed that the principles accepted above as regards trade with Austria should be extended in their entirety to Hungary also.

45. The European Coal Situation.

(1) Italian Supplies. With reference to Minute 35 the Italian Delegates reported that the following conclusions had been reached at the meeting of the Shipping Section:—

(a) that the British Ministry of Shipping should increase to the utmost the quantity of tonnage available for the shipment of coal from the United Kingdom to Italy.

(b) that the American Representatives should ascertain as soon as possible what amount of American tonnage could, if necessary, be allocated for the shipment of coal to Italy.

The French Delegates reported that difficulties of a financial character had arisen in connection with the supply of French coal to Italy but it was agreed that pending a settlement of these difficulties the French deliveries to Italy should be maintained as an emergency measure for one or two weeks.

(2) General Situation. In view of the necessity for a careful examination of the coal position in Europe generally and for an increased production of coal it was agreed:

(i) that a Sub-Committee working under the auspices of the Kaw Materials Section should be formed consisting of the following members:—

France	M. Loucheur
U. S. A.	Mr. Summers
Italy	Professor Attolico
United Kingdom	Mr. Loe

(ii) that a representative of the Communications Committee should attend the meetings as and when necessary.

46. Italian and French Supplies.

It was agreed that the Italian and French Food and Coal Supplies should be further considered by the Shipping and Finance Sections who should report again as soon as possible to the Council.

47. Report of Communications Committee.

With reference to Minute 37 further discussion took place regarding the responsibilities to be accepted by the Associated Governments in respect of assistance to be rendered for the improvement and operation of the existing Port, Railway and Telegraphic facilities in Eastern Europe.

The following resolution submitted by the American Delegates was adopted:—

“The Communications Section should at once delegate engineers of the nationalities and to the countries proposed in their Minutes of Proceedings of 4th and 5th March (17)³ to report upon the immediate needs and the best method and source of satisfying such immediate demands.”

It was agreed that action as regards Roumania and Bulgaria should be deferred pending the arrival of General Berthelot when a special Conference would be held to consider the matter further.

In this connection the following draft resolution was submitted by the French Delegates and referred for further consideration to the next meeting:—

“The Supreme Economic Council has decided that the following countries shall be officially informed by the Associated Governments that a Central Railway Commission has been created by the Associated Committees at Paris in order to coordinate the help which will be asked by these different countries for the improvement and operation of ports, railways and telegraphs, with a view to the most speedy return possible to normal conditions.

Each country desiring assistance should create a technical commission which will get into touch with the Central Commission”.

48. Preliminaries of Peace.

With reference to Minute 32:—

(a) A Memorandum from the Raw Materials Section (31) embodying proposals for the period extending to the ratification of the Preliminaries of Peace was submitted and deferred for further consideration.

(b) A resolution from the Food Section (32) regarding the Preliminaries of Peace was noted.

Appendix 30⁴

Report From the Blockade Section as to the Removal of Blockade Restrictions on German Austria

It has been decided to place before the Supreme Economic Council for their consideration the following resolution, on which the Italian Delegate has made reservation for his Government:—

“All the blockade and trade restrictions with German Austria and Hungary will be removed, and trade with these countries will be free as soon as the necessary machinery of control against re-exportation to Germany has been established.

“This resolution to be submitted to the C.B.O.⁵ immediately for consideration of the following points:—

• “(a) What adequate frontier control should be established in order to prevent re-exportation into Germany from German Austria.
• “(b) The list of commodities of which import into Austria is prohibited.”

In accordance with this decision, the C.B.O. considered and discussed the means of control to be established in the event of the reopening of free trade with German Austria. It was decided to submit to the Superior Blockade Council the following proposals:—

(1) The importation of the following products of which the importation into Turkey [Bulgaria?] is forbidden shall also be forbidden into German Austria. The export from Austria of the same products shall also be prohibited:—

• Aircraft of all kinds, including aeroplanes, airships, balloons, and their component parts; together with accessories and articles suitable for use in connection with aircraft.
• Arms of all kinds, including hunting and sporting weapons, together with their component parts, apparatus which could be used for storing or projecting liquefied or compressed gases, inflammable liquids, acids, or other destructive agents capable of use in warlike operations, and their component parts.
• Armour plates.
• Armoured motor-cars.
• Barbed wire and implements for fixing and cutting same. Camp equipment: articles of camp equipment and component parts.^*
• Clothing and equipment of a distinctively military character.^*
• Electrical appliances adapted for use in the war and their component parts.^*
• Explosives specially prepared for use in the war.
• Field-glasses.
• Gases for war purposes.
• Guns and machine guns.
• Limbers, military wagons of all descriptions.
• Military harness and trappings.
• Implements and apparatus designed exclusively for the manufacture of war munitions or for the manufacture or repair of military and naval war material.
• Mines, submarines, and their component parts.
• Projectiles, charges, cartridges, grenades of all kinds, and their component parts.
• Range-finders and their component parts.
• Searchlights and their component parts.
• Submarine sound-signalling apparatus.
• Materials for wireless telegraphs.
• Torpedoes.
• Warships, including boats, and their component parts, of such a nature that they can only be used on a vessel of war.

Note.—This list is drawn short on the assumption that the Allied Military Authorities will be in a position satisfactorily to supervise the factories capable of producing munitions of war.

(2) All other commodities can be freely imported into Austria.

(3) The re-exportation by Austria and Hungary into Germany of all imported commodities shall be forbidden, except under special authorisation of the Inter-Allied Commission at Innsbruck:—

• Certain metals.
• Animals.
• Alcohol.
• Industrial fats.
• Textiles.
• Silks.
• Wool.
• Chemical products.
• Leather and hides.
• Resinous products.
• Rubber.

All other commodities may be freely exported to Germany.

(4) Austria can import from Germany only those commodities which Germany shall be authorised to export.

(5) The C.B.O. suggests that the Financial Section of the Supreme Economic Council shall examine the conditions under which exportation from Germany to Austria of other commodities can be made.

(6) The C.B.O. is of the opinion that it is necessary to establish a control on the Bavarian frontier.

(7) This control shall be exercised by an Inter-Allied Commission which will sit at Innsbruck. The composition of this Commission shall be decided upon by agreement between the Associated Governments.

(8) To carry out this control, the Innsbruck Commission will place at the railway station and at points of communication on the Bavarian frontier agents who will have the necessary power to examine, and, in case of need, cause to be stopped, the prohibited traffic. These agents will obtain control and communicate to the Innsbruck Commission any relevant documents and statistics of the Customs, Railways, and Steamships authorities.

The Austrian Customs shall, at the request of these agents, take all preventive and penal measures necessary both as regards exportation and importation.

(9) The Innsbruck Commission will receive its instructions from the C.B.O., which itself is under the jurisdiction of the Supreme Blockade Council.

The Innsbruck Commission will, however, be given all latitude to act within the limits of the above authority; in case of doubt or divergence, it shall immediately refer the question to the C.B.O., which it will keep regularly informed of its operations and of the results of its activities.

C. S. C.

March 15, 1919.

Appendix 31

Resolution of Raw Materials Section

In response to the request of the Supreme Economic Council, the Raw Materials Section presents the following proposals for the period until the ratification of the Preliminaries of Peace, or for three months.

It has drawn up the three following lists:—

(A) Provisional list of articles the export of which from Germany is prohibited.

(B) Provisional list of articles the export of which from Germany may be allowed on conditions (and subject to what may have been said at Brussels) concerning restrictions on German trade with neutrals.

(B1) Goods for which the four Associated Governments and Belgium reserve the right of purchasing the whole or a part of the German export for the whole period, at fixed prices valid for all the Allies.

(B2) Goods for which export to neutral countries may be authorised with reserve of the right of priority of purchase for the four Associated Governments and Belgium.

(C) List of goods not included in the preceding lists.

The Section provides for the organisations named below for purchases at fixed prices on List Bl, and for authorisations under reserve on List B2.

I. Classification of Exports

(Lists A, B, B1, B2, and C)

a. provisional list of articles, the export of which from germany is prohibited

War material and war products of all kinds (including ships of war).

Gold and silver.

Securities.

b.^* provisional list of articles the export of which from germany may be allowed on conditions and subject to what may have been said at brussels concerning restrictions on german trade with neutrals

(B1) Goods for which the four Associated Governments and Belgium reserve the right of purchasing the whole or a part of the German export for the whole period, at fixed prices valid for all the Allies.

(B2) Goods for which export to neutral countries may be authorised with reserve of the right of priority of purchase for the four Associated Governments and Belgium.

Observations.

1. As long as the agreements for articles of List B1 have not been concluded, such articles will be subject to the same regulations as List B2.

2. In the case of purchases at fixed prices, the export of any surplus above the quantities which the Allies have reserved for themselves will be free (List C).

b1. goods for which the four associated governments and belgium reserve the right of purchasing the whole or a part of the german export for the whole period, at fixed prices, valid for all the allies

Coals of all kinds, cokes and derivatives of coal.

Wood and its derivatives.

Nitrogenous chemicals—dyestuffs.

Potash.

Window glass.

b2. goods for which export to neutral countries may be authorised with reserve of the right of priority of purchase for the four associated governments and belgium

Iron, cast iron and steel (and finished and half-finished products).

Sugars.

Paper and wood pulps.

Glass and glass articles (not including window glass).

Lime and cements.

Electrical machines and parts.

Plant, machinery, machine tools, material for industries.

Railway material.

Special List

For the following articles in the above list the four Associated Governments and Belgium have the privilege of entering into a bargain or contract with the Germans for such quantities and at such prices and under such conditions as may be mutually agreed upon with the Germans:—

• Coals of all kinds, cokes and derivatives of coal.
• Wood and its derivatives.
• Nitrogenous chemicals—dyestuffs.
• Potash.
• Window glass.

When such bargains or contracts have been made, the exportation of the quantities in excess of those which the four Associated Governments and Belgium have purchased will be without restriction (List C).

list (c). articles not included in the preceding lists

Free exportation—

• Proposal 1: To all neutral countries.^* For which Associated Powers have authorised the resumption of commercial relations. (Note proposed by the French Ministry of Blockade.) [Footnote in the original.]
• Proposal 2: To all countries, neutral countries,^* and Allied or Associated countries, it being clearly understood for these last that each of the Associated Governments retains full freedom to authorise or not importations of German origin into its country.

Proposal 1 was adopted by the Section unanimously; Proposal 2 was adopted by a majority.

The Supreme Economic Council is requested to decide between these two proposals. If the decision is in favour of Proposal 2, it might also apply to List B as well as to List C.

II. Organisation Suggested

1. Organisation suggested for purchases at agreed prices.

There will be established for each product or category of products a Commission of experts representing the four Associated Powers and Belgium. This Commission will be instructed to agree with the German representatives as to the prices at which these products will be bought from Germany, and all other conditions of the bargain.

2. Organisation suggested for licenses to export, with privilege of priority, for the four Associated Governments and Belgium.

There exists, under the authority of the Reichs-Kommissar für Ausund Einfuhrbewilligung, a Commission (Department of the Reichs-Wirtschaftsamt in Berlin), charged with the duty of examining requests for licenses. This regulation of licenses will necessarily be extended to all exportations.

A Commission, composed of the Representatives of the Associated Governments, will be established in Berlin. All requests for authorisation will be submitted to it.

In order to avoid all delay, this Commission will meet every day. It will decide at once on all requests which are not affected by a reservation made by any of the Governments. For all other requests, a period not exceeding eight (8) days will be left to the Associated Governments and Belgium to exercise their pre-emption.

In case of competition between several of the Associated Governments, the distribution of articles will be made in proportion to the immediate needs of each of them, but with priority for the needs of restoration of the devastated regions.

In every case the price at which the right of pre-emption is exercised must be equal to the price agreed by the neutral.

The Associated Powers reserve the power of selling, even in neutral countries, products thus acquired by pre-emption. They will in this case give to Germany a price which she would have obtained if she sold direct.

temporary provision

Until the Commission representing the Associated Governments is ready to exercise the privilege of priority, the German Government shall be free to authorise exportations of articles comprised in Lists B and C as at the present time, but shall give full information to the representatives of the Associated Governments of all exportations authorised.

Appendix 32

Recommendation [From the Food Section] to the Supreme Economic Council Regarding Preliminaries of Peace

The Food Section adopted the following resolution:—

“The Food Section do not desire to recommend the imposition by the Preliminary Peace Terms of any limitation of food into Germany.”

In making the above recommendation, the Food Section call the attention of the Supreme Economic Council to the fact that, while the world supplies are in general sufficient to cover the world needs, this is mainly a question of shipping, and in giving out their opinion they desire to make it clear that they are basing their judgment on the assumption that the world shipping and finance will be so regulated as to make it possible to secure distribution of the world supplies.

March 15, 1919.

1. For texts of the agreements reached at Brussels March 13 and 14, see memorandum of the conference and its appendixes, David Hunter Miller, My Diary at the Conference of Paris, vol. xvii, pp. 197–214.
2. See minutes of meeting held on March 22, at 2:30 p.m., p. 75.
3. Ante, p. 44.
4. Appendixes 30 to 32 are filed separately under Paris Peace Conf. 180.0501/33.
5. Comité du Blocus de l’Orient.
6. These articles will ultimately be taken off the list. [Footnote in the original.]
7. These articles will ultimately be taken off the list. [Footnote in the original.]
8. These articles will ultimately be taken off the list. [Footnote in the original.]
9. See reservation made as to List C, which may also apply to List B. [Footnote in the original.]
10. For which Associated Powers have authorised the resumption of commercial relations. (Note proposed by the French Ministry of Blockade.) [Footnote in the original.]
11. For which Associated Powers have authorised the resumption of commercial relations. (Note proposed by the French Ministry of Blockade.) [Footnote in the original.]