Mr. Eden today met the High Commissioners for Canada, New Zealand, South Africa and myself, together with the acting High Commissioner for Australia.

EGYPT:

The British Foreign Secretary¹ said that the political difficulties at the moment in Egypt were considerable. He doubted whether anybody outside the inner political circle in Egypt could have much idea of the amount of intrigue existing there. The recent trouble with the students, for example, they were informed was not due to the Left Wing but to action at the Palace - quite possibly because the King for some reason or other wished to discredit the Prime Minister!

This political maelstrom continued uninterruptedly and British soldiers were there all the time in reserve if trouble should arise. They had therefore come to the conclusion that it would be well for the British to make a Treaty with the Egyptian Government. I asked what kind of Treaty this would be. The British Foreign Secretary said that what they had in mind was a Treaty somewhat similar to that with Iraq. I said I was not familiar with the Treaty of Iraq. Mr. Eden then said that they would seek to get a Treaty in which the British position, particularly that concerning military occupation and defence, was recognised and regularised. They would also want the position with regard to the Sudan to be properly defined. They hoped that Egypt was coming into the League and it would be in the interests of all concerned that a Treaty should be reached. Mr. Eden thought that it would be an extremely difficult Treaty to negotiate but the High Commissioner, Sir Miles Lampson, seemed reasonably hopeful.

I said that I had no instructions from my Government, but speaking for myself I thought they would be interested, and I would therefore be glad if I could be furnished later with rather fuller information. Mr. Eden said he would certainly do his best to comply with this request, and he would telegraph in the course of a few days to all Dominion Governments about the disposition of British troops in Egypt.

DANZIG:

The position in Danzig, the British Foreign Secretary reported, was not satisfactory, and it seemed to him that an extremely difficult situation was developing there. The British attitude would be that they would support any proposal which the Council of the League might decide upon. The Nazis were not behaving well and their suppression of freedom, religious toleration, and so on was entirely against the Constitution. The impression they had was that the Danzig trouble was not in any way inspired from Berlin. The remarkable thing was that the Governments appeared to be quite friendly. Individuals however did not get on together and were rather cynical in their comments about 'the friendly relations' of the two Governments. He supposed that in the last resort the economic pressure of the Poles could be decisive.

ABYSSINIA:

Here he had no fresh developments to report.

He thought that the Italians would like negotiations to begin again though when I inquired I found he had nothing very definite on which to base this opinion. The British Government were not disposed to take any initiative at present but they would be glad to hear from or talk to other Powers.

Their experts told them that the military position of the Italians was not good. They seem to have been making the most elementary blunders. For example, they had seriously miscalculated the number of lorries needed for transport purposes. When a batch of Italian troops were one hundred miles away from their base they were supplied with a certain number of lorries for transport but these troops had to be satisfied with only the same number of lorries and transport facilities when they were two hundred or more miles away from this base. Private reports from the correspondent of an important American newspaper alleged that the transport service was altogether inadequate, and further, that the driving of the motor lorries was so bad that in certain parts of Abyssinia more Italian soldiers were killed by lorries overturning and accidents through bad roads than were killed by their enemy. This American correspondent it was stated was strongly pro-Fascist. Another newspaper correspondent had reported privately that the Italian soldiers were not making in this fight any better show than they made in the European War.

The British Cabinet hoped that the Committee of Eighteen would resolve on an investigation into the effectiveness of oil sanctions. A comprehensive report on this subject leading to conclusions might possibly be drawn up in about three weeks time. The League should certainly get on or get out in regard to oil. The question should not be allowed to drag on. Their information was that the Italians had increased their oil storage capacity and that they now had reserves enough for a further six months. I asked whether he could say anything about the attitude of the French Government on the proposed oil sanction and he replied that he could not. A view which was gaining ground in this country was that oil sanctions might help Mussolini to save his face, and he was personally disposed to think that there might be a good deal to be said for the view that the League should not help him in this way. There was a growing disillusionment in Italy and there was now fairly wide and open criticism of what are described as Mussolini's errors. Again he thought the Italians were much shocked by the assurances which were given by Turkey and other countries on the question of a possible hostile act by Mussolini. He thought that Mussolini would not now regard oil sanctions as an act of war.

One of the most potent factors in the situation, as the British Foreign Secretary saw it, was the position of the Italian gold reserve. It had now gone down to half of what it was fairly recently. His own view was that this may well prove to be a far more effective restriction on Signor Mussolini than any embargo on oil.

Both Mr. Eden and Sir Eric Drummond were strongly of opinion that there was now far less likelihood than was the case a few weeks ago of Signor Mussolini doing what had been called a mad dog act.

I asked whether the British Government had any views as to the ultimate issue of the Abyssinian conflict. He said that he had discussed this question at considerable length with Sir Eric Drummond and both of them were unable to say how they thought the Abyssinian struggle would end, or what would be the consequence to Mussolini's power in Italy. It seemed unlikely that he would go out of power in ignominious defeat.

As far as the British were concerned they were very anxious to avoid a European situation in which Italy would either be weak or broken. They would, he thought, be prepared - if only a settlement to this dreadful fight could be reached - to prevent any catastrophic change in Italy by helping her in every way possible after the cessation of hostilities.