Coll 17/7(1) 'Iraq and Palestine: agreement for transit through Palestine of goods to and from Iraq; Baghdad-Haifa railway' [‎79v] (169/1068)

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18. Mr. STEEN DALE BENNETT suggested that there might also be
certain important political considerations in its favour. The proposed railway
might have the effect of centralising on Palestine the communications of Iraq
whereas if the Syrian route were allowed to establish itself as the ordinary line
of communication between Iraq and Europe, Iraq and Syria would inevitably be
drawn together. He did not suggest that this was a decisive factor, but in view
of its possible effect on the position of His Majesty’s Government in Iraq, it was
one which would have to be weighed.
19. COLONEL MACKESY thought this important, and enquired whether
it was likely that the French would stay in Syria.
20. Mr. EENDEL replied that the probability appeared to be that the
French would at any rate remain in the Lebanon, and would keep a strict control
over the Sanjak of Alexandretta. The inland State of Syria, even if it achieved
political independence of the French, would, in fact, be at their mercy without
an exit to the sea. On the point raised by Mr. Sterndale Bennett, he observed
that these political considerations were undoubtedly of great importance. He
believed that Sir F. Humphrys attached much weight to them. But they were
necessarily dependent on a number of rather imponderable factors. Iraq
possessed great elements of potential prosperity, and might one day become a
second Egypt. On the other hand, there existed in some quarters a feeling that
the political future of Iraq was very doubtful. It had been suggested that Iraq
might be entering upon a long period of misgovernment, and that the country
might gradually sink to the level of a typical weak and corrupt Oriental State.
On this view it had been argued that the most that it would be worth the while
of His Majesty’s Government to do would be just to keep the Treaty of Alliance
with Iraq alive, and to maintain a certain connexion with the country, but not at
the expense of any great effort or financial sacrifice. In view of all these political
uncertainties, Mr. Rendel feared that Ministers would be unlikely to agree to
embarking on considerable financial liabilities on the strength of the political
arguments alone.
21. Mr. BRIDGES suggested that it might be difficult to justify in the
eyes of public opinion a guarantee on the Treasury for a railway built in the
interests of Iraq.
22. Mr. STERNDALE BENNETT observed that, if His Majesty’s
Government decided to further the construction of the railway, it would, of
course, be because they considered it to be in their own interests.
23. Mr. RENDEL agreed, and pointed out that, on the more optimistic of
the two views of the future of Iraq which he had just outlined, it might
be possible to regard the railway as being on the long view a major Imperial
interest. If it were decided to proceed with the scheme, a case could be made out
for it on the ground that its construction might be a decisive factor in Iraqi
politics, that it was in the best interest of His Majesty’s Government to maintain
Iraq, a country of very great potential wealth, as a coherent whole, intimately
connected with Great Britain, rather than to allow it to gravitate towards Syria
and become a half-French Arab State.
v^" R * enquired why, when the Haifa-Baghdad railway
project had been under discussion for so many years it was now regarded as
necessary to take a final decision about it.
25. Mr. RENDEL explained that under the separate agreement on
financial questions attached to the Anglo-Iraqi Treaty of Alliance of 1930, His
Majesty s Government were under an obligation to settle the question of the
Iiaqi railway by transferring the legal ownership of the Iraqi railway system to
a special Corporation. The draft Railway Corporation Law, which had
been devised to give effect to this solution of the question, appeared
likely to be stillborn owing to the opposition of the Iraqi Government. H
was, of course, open to His Majesty’s Government to continue their
struggles to secure the passage and execution of the law, but they
were unlikely to be successful. Moreover, the whole problem of fhe
Iiaqi railways, which was becoming increasingly^ urgent, was bound up with
the question of the proposed Iraqi guarantee for the Haifa-Baghdad railway.
If His Majesty s Government decided that it was essential that the
Haifa—Baghdad railway should be built, they must insist on securing this
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