Mr. Eden asked the High Commissioners to meet him at the British Foreign Office last evening. Of the High Commissioners there were only Mr. Jordan aand myself present, the other High Commissioners being on the Continent on leave prior to proceeding to Geneva. There were also present:

Mr. Ilsley, Canadian Minister for Finance and a Delegate to the Assembly

Mr. Stirling, Secretary to the Australian Delegation at Geneva

Dr. Gie, Union of South Africa Minister at Berlin and Delegate to Geneva

His Highness The Aga Khan, and Sir Denis Gray (India Office), Delegates to Geneva

Mediterranean

The British Foreign Secretary said that his Government in agreeing with the proposal of the French Government for a conference on the recent submarine attacks in the Mediterranean had suggested that the Conference should be limited to Mediterranean powers only. They wished to avoid the risk of a fruitless political wrangle. The French Government however insisted upon the Black Sea powers - Russia, Romania and Bulgaria - being included. The British had to agree to this but had pressed for Germany to be included so as to make the attendance of Italy more likely. It seemed to him that the Germans had behaved better than Italy in the Spanish conflict and it was interesting to note that the French were hoping that the Germans would attend the Conference. As yet it was not known which powers were accepting the invitation. The intention was to hold the Conference at Nyon, near Geneva, on Friday next, 10th September.

It was the British hope to keep the discussion to technical rather than political grounds. He thought his colleagues in the British cabinet would agree to his proposals that this conference should decide that the recent submarine activities in the Mediterranean in sinking ships without warning represented a grave abuse of that weapon, and that these sinkings were contrary to international engagements. He would try to get a resolution requiring both parties to the conflict in Spain to keep their submarines when submerged within the limits of their territorial waters. Outside the territorial waters the submarines should be required to have surface movements only. The British Admiralty experts were looking into this and relative points on the submarine question but he hoped to obtain decisions more or less on these lines at the Conference.

(After the meeting, speaking to me alone Mr. Eden told me in strict confidence that following upon the discharge by the British of the depth charge a certain European nation summoned its submarines to their respective bases).

There was no reference at this meeting to the telegrams which the United Kingdom Government had sent on Monday last to us and other partner Governments about instructions to the Masters of merchant vessels. It seems reasonable to assume that the British will defer their final decision on the last mentioned point until the resolutions of the International Conference are reached.

The Far East

Mr. Eden said that the Japanese had stated that they did not wish to interfere with foreign shipping but they were very anxious to avoid the abuse of the unjustifiable use of neutral flags. The United Kingdom, the United States, and France, all agreed with this view since it would mean a far less difficult position than if the Japanese Government declared a state of war and exercised its belligerent rights at sea. The British Foreign Secretary then outlined

the proposals contained in the telegrams which I sent to the Department on Saturday last. The United States were extremely anxious that the British should proceed on these lines. They have a very big trade with China and would want the minimum interference with their shipping. Again, China is now the largest export market for Germany and that country also would prefer the British proposals to a declaration of a state of war by Japan.

A copy of an ad interim reply by the Japanese Government to the British Government's communication on the shooting of the British Ambassador was handed to Mr. Eden during the meeting and he immediately read out its terms. After reciting that they took all steps for the British Ambassador's comfort and their tendering of sympathy at the appropriate diplomatic points the Japanese Government said that they were conducting investigations into the incident. They had as yet found no evidence which showed that the shooting was done by any of their forces. They were prosecuting these investigations with all speed and would communicate again when they had reached a conclusion.

The British manufacturing resources are theoretically available to either party in the Far East for the supply of munitions. Actually this does not mean a great deal since there is little margin of armament production available outside the production of munitions for Britain itself. The British have however accepted some orders from the Chinese for aeroplanes, and the United States are executing considerable orders for aeroplanes also for the Chinese.

The information in the British Foreign Office is that the Japanese are rather seriously concerned at the strength of the Chinese resistance. (The opinion in financial circles in the city of London is that if China can put up a good defence for six months the position may become critical for Japan since it may be difficult if not impossible for her to continue this vast expenditure on warfare and at the same time continue under-selling her competitors in the markets of the world. This is City opinion, not Whitehall.¹)

Abyssinia

It seemed as though the meeting was finished when I enquired what line the United Kingdom Government were proposing to take at Geneva with regard to Abyssinia. Mr. Eden said that he thought the only question on this subject which would come before the League would be as to whether Abyssinia existed as an independent sovereign State with a Government in being and whether she was therefore competent for membership of the League. Their information was that the Italian forces were now in effective military occupation of the whole of Abyssinia save for one small section in the South West. The Italians had not of course had time to set up an effective civil administration. It would seem that there was now no Abyssinian Government as such since the two deputies who tried to carry on the Government after Hailé Selassie's departure had now escaped into Kenya. In his view the question of recognition of Italy in Abyssinia and the title of its King would be for the powers individually though on this he was not stating a final opinion. He had been interested to learn from Mr. Walters of the League Secretariat in Geneva that the expectation was that no Delegate from Abyssinia would attend and when Mr. Eden asked why that opinion prevailed he was told that it was because of the suggested forthcoming conversations of Lord Perth with Mussolini.

I suspect, and it can of course be no more than a suspicion, that the British are probably looking for an appeasement in the Mediterranean as a result of the Conference on Friday if Italy can be induced to attend, which is now less sure after the Russian incident. If such appeasement be achieved and if the British Ambassador at Rome should be successful in the proposed conversations - these proposed talks it will be recalled, were the subject of warm commendation both by the British Prime Minister and the Duce - in securing an improvement in the general European situation some form of recognition of the Italian conquest might be agreed to by the British as a part of a general European settlement.

During the talk on Abyssinia a protracted and somewhat tiresome discussion was started by Mr. Jordan. He wanted to know what his position was if he at Geneva opposed any recognition of the Italian conquest in Abyssinia and the British Ambassador at Rome conveyed as he put it the British Commonwealth recognition of that conquest. Was not the British Ambassador at Rome the King's Ambassador and was he not, as such, since New Zealand had no Minister in Rome, the representative of the King in his capacity as King of New Zealand? Without waiting for Mr. Eden to answer this question I said that Lord Perth clearly represented only the Government of the United Kingdom and cited Washington, Paris, and Berlin as foreign government capitals where we, together with other partner Governments, had our own Ministers. In the case of Tokyo, should the British Government decide to recall their Ambassador it was perfectly open for the Canadian Government if they so wished to retain their Minister in that city. Mr. Malcolm MacDonald accepted this and after some rather desultory talk Mr. Eden said that he did not think the New Zealand Government had any responsibility for the British Ambassador in Rome. Although it should hardly be necessary the discussion seemed to make it incumbent on me to emphasise the obvious fact that we went to Geneva as a sovereign independent State.