13 Report by Walker

Extracts [7 JANUARY 1946] [1]

REPORT OF THE AUSTRALIAN DELEGATE TO THE PARIS CONFERENCE ON REPARATIONS

9th November to 21st December, 1945

The Paris Conference on Reparations met on the invitation of the Governments of France, the United States and the United Kingdom from 9th November to 21st December, 1945, in the Palais du Luxembourg. The following Governments were represented:

Albania Greece United States of America India Australia Luxembourg Belgium Norway Canada New Zealand Denmark Netherlands Egypt Czechoslovakia France Union of South Africa United Kingdom of Great Yugoslavia Britain and Northern Ireland The Commonwealth Government was represented throughout by Professor E. Ronald Walker, Counsellor, Australian Legation at Paris, as First Delegate; in addition the earlier sessions were attended by Mr. J. D. L. Hood, Political Adviser to the Australian Military Mission at Berlin, Mr. A. H. Tange of the Department of Post-War Reconstruction, and Mr. S. Atyeo, Second Secretary, Paris Legation; and Mr. J. R. Cochrane, Leader of the Australian Scientific and Technical Mission, was also present at several sessions.

According to the terms of invitation received, the purpose of the Conference was to examine the data furnished by the interested Governments relating to their claims for reparations from Germany, and to prepare the way for an inter-governmental agreement on the division of reparations among the Governments concerned. It was suggested also that the Conference should prepare recommendations regarding the establishment of an Inter-Allied Reparations Agency.

In fact the discussion of these subjects led various delegates to raise other questions which, although related to reparations policy, also involved broad political issues.

[matter omitted]

The tendency of the Conference to deal with issues wider than might have been expected in view of the terms of the invitation was due largely to the complexity of the reparations question from the viewpoint of the European Continental countries, and also to the high level at which some countries were represented. According to the invitation, the Conference was presumed to be one of expert officials, but the Yugoslav Delegate was Dr. Ales Bebler, Slovene Minister of Finance; and the Belgian Delegation was strengthened at the most critical moment of the Conference by Monsieur Camille Gutt, Minister of State, as spokesman of the Belgian Cabinet. The following Governments were all represented by Delegates holding the rank of Minister Plenipotentiary:-Albania, U.S.A., Belgium, Egypt, Netherlands and Czechoslovakia.

The outstanding personalities throughout the whole period of the Conference were M. Jacques Rueff, the President (France), Minister James Angell (U.S.A.), Dr. David Waley (U.K.), Dr. Ales Bebler (Yugoslavia), M. Kaeckenbeeck (Belgium) and Dr. Vavro Hajdu (Czechoslovakia). The conduct of the Conference by the President and the United States and United Kingdom Delegates evidenced a strong desire to make the Yugoslav and Czech Delegates feel at home in the midst of the Western European nations. They were given every encouragement to state their views at length, and took full advantage of the opportunity, even to the point of appearing to dominate the discussion time and time again. On the whole their special demands were met at least as generously, if not more generously, than those of the smaller Western nations, and one could not escape the impression that wider political considerations than the disposal of German reparations influenced the position adopted by the inviting powers on many of the questions discussed in the course of the Conference, which M.

Rueff referred to on several occasions as 'a part of the Peace Conference'.

As a signatory of the Final Act of the Conference [2] ... I have the honour to recommend to the Government that it should enter into an agreement with the other interested Governments in the terms of the draft prepared by the Conference. Although the share in German reparations proposed for Australia is no adequate measure of the burden of the war upon our people or of our contribution to victory, it must be remembered that Australia is one among eighteen claimant countries, including the several European countries that suffered heavy material damage at the hands of Germany and that must rely upon German reparations for much of the equipment necessary to restore even partially their pre-war economic structure. The statistical and other information placed before the Conference, and set out in memoranda already forwarded to Canberra, reveals the effects of bombardment, battle, looting, destruction and slaughter, and emphasises, by contrast, Australia's narrow escape from the worst ravages of invasion and enemy occupation. Australia has a real interest in the rapid reconstruction of our European Allies and is therefore bound to support a distribution of German reparations designed primarily with this in view. At the same time the share attributed to Australia, together with the general principles to be followed in allocating industrial and other equipment, should enable Australia to acquire certain plant and equipment that will be of considerable assistance in her post-war industrial development.

Comments on the Draft Agreement Part I, Article 1, Reparations Shares The proposed shares are as shown in the following table:-

CATEGORY A CATEGORY B Albania .05 .35 United States of America 28.00 11.80 Australia .70 .95 Belgium 2.70 4.50 Canada 3.50 1.50 Denmark .25 .35 Egypt .05 .20 France 16.00 22.80 United Kingdom 28.00 27.80 Greece 2.70 4.35 India 2.00 2.90 Luxembourg .15 .40 Norway 1.30 1.90 New Zealand .40 .60 Netherlands 3.90 5.60 Czechoslovakia 3.00 4.30 Union of South Africa .70 .10 Yugoslavia 6.60 9.60 Total 100.00 100.00

The figures under Category B relate to plant and equipment, merchant ships and inland water transport; those under Category A to everything else except gold. The percentages are different in the two columns because the United States, Canada and South Africa have waived substantial proportions of their claims to equipment as distinct from other forms of reparations (especially German External Assets held by them). In allocating among the other countries the amounts foregone by these countries it was considered necessary to give some slight preference to the smaller European countries that had suffered under German occupation and in the course of battle; with this in view the United Kingdom waived any claim to share in the amounts foregone by the United States, Canada and South Africa, and even accepted a slight reduction in her percentage for Category B as compared with Category A.

[matter omitted]

The significance of the Australian share depends upon the total value of equipment and other items available for distribution. No official estimates exist since the Allied Control Council has not yet completed its task of selecting factories for reparation.

Informed opinion is that a share of 0.95 per cent will represent equipment worth at feast 2 Million sterling; possibly considerably more.

Articles 2 and 3 Article 2 represents an attempt on the part of the United States to ensure that this agreement will constitute a final settlement of German reparations. Unanimity on this proposal was only obtained by making a number of special exceptions for particular claims set out in this article.

Article 3 is designed to prevent subsequent litigation over property transferred as reparations.

Article 4. General Principles for Allocation of Industrial and other Equipment These provisions are particularly important since they will guide the Inter-Allied Reparations Agency when allotting any individual factories and other items for which there are more than one claimant. The final consideration in the list, viz C.(ii)(d), was inserted at the express request of the Australian delegation and together with C.(ii)(c) will provide the main basis for Australian claims to particular items. [3]

Article 5. Merchant Ships and Inland Water Transport German ships will be distributed in proportion to total losses through acts of war. A special committee will wrestle with two problems left unsolved by the Conference, viz (i) To what extent, and how, should consideration be confined to losses by German action;

(ii) Meeting the specialised needs of certain countries; e.g.

Norway is pressing hard for a whaling factory ship.

Article 6 German External Assets These provisions occasioned some of the most protracted and complicated discussion of the whole conference, and revealed a marked difference of approach between the Belgian and Dutch delegates on the one hand, who were concerned over the maintenance of existing property rights of their nationals, and the Yugoslav and Czech delegates who were little concerned over such aspects.

It is believed that the provisions of this article are consistent with the Commonwealth Government's policy, but they should be carefully examined by the appropriate authorities.

Article 7. Captured supplies This has little application to Australia.

Article 8. Reparations for Non Repatriable Victims of Germany This proposal emanated from the United States; and in its original form was greeted with great suspicion by the Yugoslav delegate, who feared the funds might be used to support refugee elements hostile to the present regime. Most of the detailed delimitation of the persons eligible for assistance was inserted to meet Yugoslav objections. The 'non-monetary gold' referred to consists mostly of wedding rings and teeth fillings found in German concentration camps. [4]

Part II. Articles 1 to 11 Inter-Allied Reparations Agency It is expected that the Assembly of the Agency will meet frequently in the initial stages. The most interesting feature of the proposed constitution is the provision for arbitration in Article 7.

Part III. Restitution of Monetary Gold Monetary gold found in Germany will be pooled and divided in proportion to the respective losses of gold by various countries through looting.

Part IV. Entry in Force and Signature When the agreement has been signed by countries having collectively 80% of shares in Category A, it will enter into force among the signatories. This implies that the signature of the three inviting powers and several small countries will suffice.

Attention is also drawn to the three additional unanimous resolutions of the Conference included in the Final Act after the Draft Agreement [5]; and to the resolutions of certain Delegations included in the Annex. My comments on the latter are as follows:-

ANNEX

Resolution 1 It is difficult to forecast whether the acceptance of these principles will reduce appreciably the total available as reparation. I also feel some sympathy with the views expressed strongly by the Norwegian delegate, and mildly by Sir David Waley, that losses through looting should not constitute any priority for restitution or reparation over losses through destruction. On the whole I consider it would be wiser not to adhere to this resolution so that we may be free later to criticise the restitution policy if we find it is working unsatisfactorily.

Resolution 2 I can see no objection to this in principle, but am a little apprehensive lest there be excessive demands upon current German production; and it might be better to avoid committing ourselves unless we particularly desire to share certain existing stocks.

Resolutions 3, 4 and 5 These do not appear to affect Australia directly.

Resolution 6 I have agreed to this, since it seems incontestable. [6]

Resolution 7 This requires examination by those concerned with Australian policy on war criminals. [7]

Resolution 8 I have agreed to this since it is clearly consistent with Australian policy. [8]

E. RONALD WALKER

1 The report itself is undated. A covering letter to Evatt bears this date.

2 See Volume VIII, Document 462.

3 Article 4C listed general principles to be followed in allocating capital equipment; (ii)(d) provided for consideration of 'the requirements of countries whose reparation shares are small but which are in need of certain specific items or categories of items', and (ii)(c) for the relation of items to the general pattern of the claimant country's prewar economic life and its postwar economic development.

4 Article 8 required the governments of the United States, France, the United Kingdom, Czechoslovakia and Yugoslavia and the Inter- Governmental Committee on Refugees to prepare a plan for helping victims unable to claim from governments entitled to reparations from Germany, the aid to be funded in part by 'all the non- monetary gold' found in Germany.

5 The unanimous resolutions dealt with persuasion of neutral countries to recognise the justice of reparations claims and to provide assistance, and with the need for equality of treatment by signatory governments of nationals and institutions of other signatory governments.

6 Resolution 6 recommended that costs of dismantling, packing and transporting within Germany should be a charge on the German economy.

7 Resolution 7 recommended that property of German war criminals should be confiscated, liquidated by the Control Council and allocated by the Inter-Allied Reparation Agency.

8 Resolution 8 recommended recourse to the International Court of Justice in the event of conflicts of law or competence arising from the agreement and not amenable to amicable solution or arbitration.

[AA:A4231/2, PARIS 1946, 1-21]