Letter from John W. Dulanty to Joseph P. Walshe (Dublin)
(Secret)

Following on Sir Samuel Hoare's acceptance of my suggestion on Thursday last, Mr. Eden, the British Minister for the League of Nations Affairs, asked the High Commissioners to meet him this afternoon at 4 o'clock. When the High Commissioners for Canada, Australia, New Zealand and South Africa and I arrived we were met by Mr. Malcolm MacDonald who explained that owing to discussion having arisen in the British Parliament on the peace proposals, Mr. Eden was unable to meet us.

With Mr. MacDonald were Lord Stanhope, Parliamentary Under Secretary for Foreign Affairs, and Mr. M.D. Peterson, a Counsellor of the Foreign Office and Head of the Abyssinian Department of the Foreign Office.

Mr. Peterson explained that he had been in Paris for about ten days before the arrival last Saturday of Sir Samuel Hoare. He had come to a complete deadlock in his discussion with the French.

Sir Samuel Hoare began his conversations with M. Laval on Saturday morning on the question of the assurances already categorically given by M. Laval about the French supporting the British in the event of trouble. Mr. Peterson said that although Sir Samuel Hoare had received these assurances and although the Air, Naval, and Military General Staffs of the French were ready to consult with the British, they, the British, still felt that there were certain reservations existing in the mind of the French Government. M. Laval had admitted that there were possibilities of difficulties in that certain not unimportant sections of French opinion were still suspicious of the British and it was not impossible for a situation to arise in which owing to this suspicion and latent opposition the French Government might not be able to mobilise.

Mr. Peterson then outlined the terms which he said were certainly more favourable to Italy than they would have been if they, the British, had felt more sure of the French. There were also doubts about Yugoslavia.

The terms of the proposed settlement have already been telegraphed to you.

From the summary given at the meeting today it seemed to me that one of the most important parts of the proposed settlement was the considerable area in the South of Ethiopia which was to be reserved for Italian economic expansion and settlement. Roughly speaking, it is approximately rather more than one-third of that country's existing territory. On the other hand it is said to be largely desert country and to have been only recently acquired and consistently neglected by the Abyssinians so far as development was concerned. It is said that the climate is wholly unsuited to Northern Europeans but it might be a country in which Southern Europeans could live. Except for the Western corner I was told that there was practically no mineral content in the proposed Italian zone. I was further told in response to enquiry that there would be no opportunity for the Italians to militarise the natives or to draw a militarised belt South of Abyssinia since the whole of this area for Italian expansion and settlement would be under the League of Nations. The administrative direction of it would be 'predominantly but not exclusively' Italian.

The whole of Ethiopia as it now stands would be served by a League plan of Assistance as proposed by the Committee of Five. The administrative chiefs both for the Italian economic expansion area and all the other areas would report to no one but to the League of Nations.

The Cabinet considered these proposals which we were told Sir Samuel Hoare thought was the best that could be obtained as an alternative to the continuance of the War. On procedure they objected to the French proposal that a full description of the proposed settlement should be sent to Italy, whereas a sketch only should be sent to the Emperor. They - the British - insisted on a full statement being sent simultaneously or as near that as possible to Signor Mussolini and to the Emperor. The French proposal was that the Committee of Eighteen should suspend its sittings until it was seen what had happened to the Committee of Five who were to consider these proposals. The British proposal was that the Committee of Eighteen should meet on the 12th and should be told that the Committee of Five was being called to consider the proposals for peace and that the Committee of Eighteen by its own decision would then adjourn.

The French Government we were told further wanted the British to agree that if the Italians accepted these proposals and the Emperor did not, the British should agree forthwith to proceed no farther with the Oil Sanctions. The British reply was that they must reserve their decision and keep their hands free about the Oil embargo. It was not possible they thought to foresee today what might be the exact position in the event of Italian acceptance and Ethiopian rejection of the proposals.

The British Cabinet decided this afternoon to send a cable to the French insisting on both parties being given a full statement of the peace proposals and saying that they could certainly not agree to abandon the Oil Sanctions on the hypothesis put forward by the French.

Mr. Peterson who drafted the telegram to the French Government today told me at the close of the meeting that he thought it was probable, that, if the terms went forward on the conditions which the British proposed, these terms might be accepted by Italy and rejected by Ethiopia.