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that year's Agreement deliveries to be credited to Germany, together with the annual instalment to repay the debt incurred in respect of the period ending 1st May 1926, exceeds one milliard, the excess is to be carried forward from year to year until a year is reached in which no such excess is created by the payment. But in no case shall the amount credited, even if it is less than one milliard gold marks, exceed the limit laid down by the preceding condition.

(3) Any balance with which Germany has not been credited on 1st May 1936 is to be credited to her with compound interest at 5 per cent. in four half-yearly payments on 30th June and 31st December 1936 and 30th June and 31st December 1937. But, again, these half-yearly payments shall not be made if the effect of making them would be to exceed the limit laid down in condition (1) above.

(4) Agreement deliveries continue indefinitely after 1st May 1936, with power, however, to Germany to arrest them whenever the execution of them would result in France owing more than 52 per cent. of Germany's annual reparation payment in respect of Annex deliveries, deferred payments already matured, and the 35 or 45 per cent. of current deliveries.

From the above it is to be noted that, while there is a limitation for the ■ first five years of the amount of Agreement deliveries which can be demanded, there is,

(1) No point at which the right of France to demand these special deliveries automatically terminates;

(2) No final limitation upon the value of the deliveries which can be demanded by France during the lifetime of the agreement;

(3) No definitely prescribed period within which France's debt to Germany and to the other partners in reparation shall be liquidated.

The financial effect of the agreement is perhaps best shown by taking hypothetical examples.

Let it be assumed that Germany's annual reparation obligation under the schedule of payments amounts to 3,300,000,000 gold marks, of which France, under existing inter-Allied agreements, is entitled to receive 52 per cent., or, 1,700,000,000 gold marks. Let it be assumed again that France receives annual Annex deliveries to the value of 450,000,000 gold marks. The Annex and Agreement deliveries together in the first five years are not to exceed 7,000,000,000 gold marks. Five years' Annex deliveries, on the above hypothesis, amount to 2,250,000,000 gold marks, leaving a maximum value of 4,750,000,000 gold marks for the Agreement deliveries over the same period. Let it be assumed that the Agreement deliveries are spread equally over the five-year period, with the result that their annual value amounts to 950,000,000 gold marks. In the first year, 1921-22, it is specially provided that not more than 35 per cent. shall be credited to Germany, or 332,500,000 gold marks, leaving payment to be deferred of 617,500,000 gold marks. In the second and subsequent years, up to May 1926, 45 per cent. of the 950,000,000 gold marks, or 427,500,000 gold marks, would be credited, leaving 522,500,000 gold marks to be deferred. At the end of the period, therefore, France would owe a total of 2,707,500,000 gold marks, together with simple interest at the rate of 5 per cent, per annum.

Leaving out of account the complication of interest, France is to liquidate this debt in ten equal annual instalments of 270,750,000 gold marks, subject to certain conditions, and the effect of these conditions must be stated with the aid of further hypothetical figures. Let it be assumed that the amount of Germany's annual reparation obligation and the amount of France's Annex deliveries remain constant, and let it further be assumed that France continues to call for Agreement deliveries to the value of 500,000,000 gold marks a year. France will then be debited for the year 1926-27 with 450,000,000 gold marks for Annex deliveries, 270,750,000 gold marks for the earlier Agreement deliveries, and 225,000,000 gold marks, being 45 per cent, of the current year's Agreement deliveries, making in all a total of 945,750,000 gold marks. She will have paid off 270,750,000 gold marks, but have incurred a fresh debt of 275,000,000 gold marks. She will then owe 4,250,000 gold marks more on the 1st May 1927 than she owed on the 1st May 1926. This process might continue until 1st May 1936.

Should the Agreement deliveries continue on a higher scale, France's debt would be more heavily increased in proportion. Let it be assumed, for example, that the Agreement deliveries in the year in question amounted to a value of 900,000,000 gold marks. France cannot be called upon to pay more in a year than one milliard. She will have to pay in respect of Annex deliveries and previous Agreement deliveries a total of 720,750,000 gold marks. It follows, therefore, that not more than 279,250,000 gold marks out of 900,000,000 gold marks, which represent the hypothetical value of that year's Agreement deliveries, will be paid for, leaving a total of 620,750,000 gold marks to carry forward, and an increase in France's debt of 350,000,000 gold marks.

The results might be indefinitely varied by choosing different figures for any one of the factors which enters into the problem. It is perhaps unnecessary, however, for the sake of seeing the effect of the agreement, to vary the above hypotheses in more than one respect. It is desirable to consider the effect on the above calculations of a decrease whether by reason of an actual German default or through a postponement regularly accorded by the Reparation Commission under Article 234 of the treaty, in the amount effectively paid by Germany on reparation account in any one year.

Let it be assumed, for instance, that Germany pays on reparation account in the year 1922-23 only 1,000,000,000 gold marks, of which France is entitled to 520,000,000 gold marks. She cannot be debited in that year with more than 520,000,000 gold marks, and she is automatically debited to the extent of 450,000,000 gold marks for Annex deliveries. Credit will therefore be given to Germany for no more than 70,000,000 gold marks in respect of Agreement deliveries, leaving a deferred payment of no less than 880,000,000 gold marks effectively paid to France by Germany and not available for distribution among the other Allies before, at the earliest, 1926-27. A continued failure by Germany to pay on account of reparation the amount contemplated at the beginning of these calculations would proportionately increase the amount deferred and therefore the size of the ten annual instalments which, subject always to the conditions indicated above, begin to be credited to Germany after 1st May 1926. Continued failure on Germany's part after May 1926, combined with the continued operation of the Agreement deliveries, would result in a more and more rapid accumulation of French indebtedness in the subsequent period for which no means of liquidation is provided.

It remains necessary to draw attention to one subsidiary point of a financial character under the schedule of payments. Part of Germany's annual reparation liability consists of the payment of 26 per cent, of the value of German exports in each period of twelve months, and part of the security for the payment consists of the proceeds of a levy of 25 per cent, on the value of all German exports. The French Government has undertaken to support a request, to be submitted by the German Government to the Reparation Commission, for the inclusion in the exports which form the basis of these calculations of that part only of the value of the deliveries made under the agreement which is credited to Germany and debited to France during any particular year.

If it can be assumed that any part of the special deliveries to be made under the agreement would, in the absence of the agreement, have been diverted to Germany's ordinary external trade, then the concession desired will have the effect of diminishing the annual payments made by Germany for the benefit of the Allies as a whole.

CHRONICLE OF INTERNATIONAL EVENTS

Fob The Period May 16—August 15, 1922

(With references to earlier events not previously noted.)

WITH REFERENCES

Abbreviations: Adv. of peace, Advocate of peace; B. I.I.I., Bulletin de l'lnstitut Intermediaire International; Bd. of Trade J., Board of Trade Journal (London); Bundesbl., Switzerland, Bundesblatt; Clunet, Journal du droit international; Cmd., Great Britain, Parliamentary papers; Commerce Reports, U. S. Commerce reports; Cong. Rec., Congressional Record; Contemp. R., Contemporary Review; Costa Rica, Ga., La Gaceta; Cuba. B. 0. Sec. de Estado, Boletin Oficial de la Secretaria de Estado; Cur. Hist., Current History (New York Times); D.G., Diario do Governo (Portugal); D.0., Diario oficial (Brazil); Devtsch. Reichs., Deutscher Reichsanzeiger; E. G., Eidgenossiche gesetzblatt (Switzerland); Edin. Rev., Edinburgh Review; Europe, L'Europe Nouvelle; Evening Star (Washington); Figaro, Le Figaro (Paris); G. B. Treaty series, Great Britain, Treaty series; Ga. de Madrid, Gaceta de Madrid; G. U., Gazetta Ufficiale (Italy); Gvatemalteco, El Guatemalteco; 7. L. 0. B., International Labor Office Bulletin; J. 0., Journal officiel (France); L. N. M. S., League of Nations, Monthly Summary; L. N. 0. J., League of Nations, Official Journal; L. N. T. S., League of Nations, Treaty series; Lond. Ga., London Gazette; Monit., Moniteur Beige; Nation (N. Y.); N. Y. Times, New York Times; Naval Inst. Proc., U. S. Naval Institute Proceedings; P. A. U., Pan American Union Bulletin; Press Notice, U. S. State Dept. Press Notice; Proclamation, U. S. State Dept. Proclamation; R. G. D. I. P., Revue Generate de Droit International Public; Reichs G., Reichs-Gesetzblatt (Germany); Rev. int. de la Croix-Rouge, Revue international de la Croix-Rouge; Stoats, Netherlands Staatsblad; Staatscourant, Nederlandsche Staatscourant; Temps, Le Temps (Paris); Times, The Times (London); Wash. Post, Washington Post.

July, 1921

21 BelgiumNetherlands. Workmen's compensation convention,

signed at The Hague, Feb. 9,1921, promulgated in Belgium. Text: Monit., May 28, 1922, p. 3982.

November, 1921

12 BelgiumGermany. Ratifications exchanged of the agreement concerning art. 312 of Versailles treaty, signed at Aix-la-Chapelle, July 9, 1920. Reichs G., 1922, teil 2, p. 73.

February, 1922

22 BelgiumFrance. Convention concerning reparation regulations

signed Oct. 25, 1921, promulgated in Belgium. Text: Monit., July 13, 1922, p. 4958.

April, 1922

1 FranceSwitzerland. Telephone tax agreement, signed Jan. 18-24, 1922, came into force. E. 0., May 10, 1922, p. 361.

April, 1922

4 BelgiumEgypt. Protocol signed Aug. 10, 1921, modifying commercial convention of June 24, 1891, promulgated by Belgium. Monit., Aug. 6, 1922, p. 5608.

6 AustriaUnited States. President Harding signed S. J. Res. 160 relating to deferment of certain liens held by the United States against Austria. Cong. Rec, Apr. 1, 1922, p. 5598.

8 China. President of Chinese Republic issued mandate creating the "Washington Conference Commission" to assist in carrying into effect the various resolutions and instruments enacted at Washington conference. Press notice, June 20, 1922.

12 ChileGreat Britain. Denunciation of various slave traffic

conventions became effective. Lond. Ga., July 28, 1922, p. 5592.

13 AustriaGermany. Ratifications exchanged of the treaty signed

at Berlin, Aug. 17, 1921, concerning the affairs of war injured and survivors. Reichs G., 1922, teil 2, p. 76.

17 ItalySwitzerland. St. Gothard railroad convention, signed at

Berne, Sept. 24, 1921, promulgated in Italy. Text: G. U., May 30, 1922, p. 1265.

18 SpainSwitzerland. Customs tariff convention concluded. Text

of attached schedules: Bd. of Trade J., May 11, 1922, p. 515. 25 ArgentinaChile. Convention signed at Santiago, providing

transandine connections between the two countries. P. A. U.,

August, 1922, p. 189. 25 GermanySwitzerland. Ratifications of arbitration treaty of

Dec. 3, 1921 exchanged at Berne. Reichs G., 1922, teil 2, p. 104. 25 Great BritainNorway. Denunciation became effective of slave

trade treaty of Nov. 6, 1824 and additional article of June 15, 1835.

Lond. Ga., June 13, 1922, p. 4466. 27-29 Great BritainUnited States. African slave trade treaty,

signed at Washington, Apr. 7, 1862, additional articles of Feb. 16,

1863 and June 3, 1870, denounced by Gt. Britain on Apr. 27, and

accepted by United States on Apr. 29. Lond. Ga., June 27, 1922,

p. 4814.

28 BrazilPeru. Extradition treaty signed Feb. 13, 1919, ratified

by Peru. P. A. U., Sept., 1922, p. 301.

29 Dominican RepublicSpain. Parcel post convention, signed by

Spain on Nov. 17, 1921 and by Dominican Republic, Apr. 17, 1922, ratified by Dominican Republic. P. A. U., August, 1922, p. 190.

May, 1922

1 BelgiumGreat Britain. Reciprocal agreement concerning maritime inspection, promulgated in Belgium. Monit., June 4, 1922, p. 4159.

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