GREEK LOAN. (Hansard, 16 August 1836)

§ Viscount Melbourne

, in moving the Order of the Day for the House to go into Committee on the Greek Loan Bill, acknowledged that the subject to which it related was one of very great importance, and, if followed up, would open a variety of views with respect to the foreign relations and foreign policy of this country; but the only question involved in the Bill turned on one point, and was confined to a very narrow compass. He should, therefore, content himself with briefly explaining the grounds on which he meant to move that the Bill 1240 should go into Committee. Their Lordships were well aware of the circumstances which led to the separation of the territory of Greece from the dominions of Turkey, under the administration of the noble Duke opposite. A Sovereign was subsequently elected to rule over Greece, and a guarantee, of a pecuniary nature, was entered into, for the purpose of enabling him to undertake that high situation. It was the intention of the noble Duke and of his Government, as Greece was in a most impoverished state, a long war having necessarily exhausted its resources, to give to that country pecuniary assistance in the first place. He did not mean to say, that it was then intended to grant assistance to the same amount, or on the same conditions, as had been afterwards determined on. In coming to that determination it was necessary to look to the new circumstances which had arisen, and it was with a view to those circumstances that this country had become a party to certain engagements. On the 7th of May, 1832, a convention was concluded at London between England, France and Russia, by which the three Powers engaged to supply the Government of Greece with a sum of money, the principal of which amounted to 60,000,000 francs, being 20,000,000 francs each. That convention was laid before Parliament, and was the subject of debate both in that and in the other House. The Act of the 3d of William 4th, which was passed on the 16th of August, 1832, empowered his Majesty to carry into effect the convention of the 7th of May, and under the third section of the Act the first instalment was paid. Prior to this, however, a dispute had arisen relative to the boundaries of Greece; and on the 21st of July, 1832, Sir Stratford Canning concluded a treaty with the Porte, by which the north-eastern boundary of Greece was extended and rendered more secure. By that treaty the Porte consented to cede to Greece the provinces anciently known as Acarnania and Natolia, on the payment of 40,000,000 Turkish piastres. This treaty was soon after ratified, and the payment of the second instalment of the loan guaranteed became necessary. The sum for which the Porte had given up the two provinces was, as he had already said, 40,000,000 piastres, or about 11,220,000 francs, which lowered to that extent the amount of the sum guaranteed by the tripartite convention, to be applied to the in- 1241 ternal affairs of Greece. The consequence was, that within a short time the Government of Greece complained, through the Minister of that country, of a great want of funds. It was necessary to provide for the interest and sinking fund of the loan, which required 2,212,000 francs, and it was proposed to advance 6,000,000 francs of the third instalment. Hitherto the three Powers had acted in concurrence, but when the British Minister came to confer with the Minister of Russia on this subject, he found that a very great difference of opinion prevailed. The French Minister was ready to guarantee, on the part of his Government, the third of the remaining 20,000,000 francs, and to allow it to be at once advanced for the service of the Grecian Government, but the Russian Minister took a different view of the matter. He was not willing that the third of the loan which was guaranteed by Russia should be advanced, but he proposed that it should be doled out in such sums as would enable Greece to pay the interest and sinking fund of the loan. Now, his Majesty's Government were of opinion, that the course proposed by the Minister of Russia was open to serious objection. In the first place, it was not conformable to the convention of the 7th of May, 1832, by which it was intended that the sum guaranteed should be applied, in the first instance, to enable the Government to give a firm constitution to the state. In the second place, it would be very injurious, in the present state of Greece, while that state was to be attributed to circumstances which the government could not control. The insurrections which had been excited in Greece rendered a large increase of force necessary, and a consequent increase of expense. This last evil would be best met by the energy, the spirit, and the resolution of the Government, and by the gallantry displayed by the native troops that had been employed to put down those disturbances. In the third place, it was evident that the course proposed by the Russian Minister was contrary to the independence of the Greek nation, because it would enable Russia to keep up a general sort of control over the conduct of the Government and over the finances of the country hereafter. Such a proceeding was manifestly inconsistent with that independent condition in which the policy and the reason of the convention clearly intended that Greece should be placed in. Under these circumstances 1242 it was that the present Bill was proposed to Parliament, the object of which was to enable his Majesty to authorise the payment of the third instalment of the loan, without the concurrence of Russia or France. It was not in his power to go into a minute statement of the finances of Greece; but looking to the information of competent persons, looking to the knowledge of those who represented his Majesty in that country, he had every reason to believe, that if peace were preserved, and the government properly administered, that country would be able to meet the charge which it had incurred under this convention. That the government would be advantageously administered he did not doubt, when he looked at the character displayed, the conduct pursued, and the wisdom exhibited, by those who at present possessed the confidence of the King of Greece. The noble Viscount concluded by moving that the House consider the Bill in Committee.

§ The Duke of Wellington

said, it appeared to him that it was not necessary to take the occasion of the introduction of this Bill to enter into a general discussion with reference to the foreign policy of this country. A good deal could certainly be said on the subject; but he did not think that it would tend to any useful object to introduce such a discussion at present, nor was it desirable, for various reasons, to be drawn into a discussion of so wide a nature under existing circumstances. At the same time, he must say, that this was a transaction of such a description, that it required some degree of notice. He should, therefore, draw their Lordships' attention to some of the circumstances that were connected with it, and to some of the consequences that might grow out of it—consequences which might prove extremely inconvenient to the country. The noble Viscount had accurately stated the circumstances which led to this transaction. It certainly was in contemplation, in 1830, to make a loan, for the purpose of establishing a government in Greece, and, he believed, on the same plan as was adopted with respect to the loan which was settled in 1832. The Greek state was established under the auspices and influence of the three great powers—Russia, France, and England. It was agreed, that a loan was to be made by the three powers, each guaranteeing a similar amount, each guaranteeing the payment of the principal and interest of one-third of 60,000,000 francs. 1243 It might be said, that each power ought to be at liberty to guide and determine its own conduct with respect to this loan; but certainly, the principle that pervaded the whole transaction amongst these three powers with respect to Greece was, that the proceeding should be carried on by common accord. If there were to be any interference whatever in the internal affairs of any state, it was fit and proper that that interference should be affected by many states rather than by one state. The independence of the state, whose concerns were thus interfered with, would be better preserved by two, or three, or four states, than by one state. Such interference was likely to be less injurious to the power and situation of the state interfered with than if the matter were taken up by a single state. Laying that down as a principle, he contended for this, that the policy of such arrangements, and the policy of this particular engagement, was, that it should be carried into execution (although on the responsibility of each state for its own share of the loan), with one common accord. The first instalment was settled by common accord, the second instalment was made by common accord, and the same principle ought to have been acted on with reference to the third. The noble Viscount, in stating what had occurred just now, had endeavoured to show to their Lordships that he could not obtain the consent of Russia with respect to the last advance to be made to Greece under this arrangement. It appeared to him that proper measures were not taken to induce Russia to make the advance necessary for Greece on that occasion. The first demand made by Greece was for 3,000,000f. Why, he would ask, was not a strong effort made to obtain the consent of Russia to make the advance of her share of the 3,000,000 francs? Why was Russia left out of that part of the negotiation? Why was any encouragement given to leave any part of the sum due in the hands of Russia? If Russia had been called on for her portion, it would be found to amount very nearly to the sum which this country was about to advance under existing circumstances; and the consequence would have been this —that the three powers would now be placed on precisely the same footing, which was the situation in which they ought to stand. They would be thus placed, not only with reference to Greece, but in relation to each other, as well as to the other powers of Europe. But how would it be 1244 hereafter? Great Britain would be a creditor of Greece to the amount of 20,000,000 francs, with a claim on the resources of Greece, which must, and would, be pressed for the interest and sinking fund of that amount of debt. Russia, on the other side, would have in hand the third part of 20,000,000 francs, to issue to Greece whenever and under whatever circumstances she thought proper. France was placed in a similar situation. He did not mean to speak with any jealous feeling of France or Russia; but they would be strangely mistaken with reference to the general policy of other states, if they did not conclude that they were giving a great advantage to Russia and France, when they left in their hands the power of making these advances at such times and seasons as they pleased. They no longer stood in any other position but as the creditors of Greece. And, he would ask, was that the attitude in which they should be placed? Was that the situation in which these relations, formed by the convention, should stand? The Emperor of Russia, he was aware, stated, that he kept this money for the purpose of meeting the interest and sinking fund of those sums already advanced by the former instalments of this loan. Unfortunately they had set him the example of walking alone with respect to these engagements. They had set him the example by making a movement without his consent, and without the consent of France; and he was much mistaken if, to aid the purposes of those powers, they would not take the same advantage of their position, to make advances when they thought it most conducive to their interests, and act by themselves, as England had done on this occasion. Though he admitted the propriety of the advance of 6,000,000 francs for the Greek government, yet he could not allow that it was expedient that it should be advanced, and solely advanced, by this country, without the accordance of the other parties.