FRANCE: Debts

A rumor emanated from the Finance Ministry last week to the effect that France would be pleased to re-open negotiations for a settlement of her War debts to the U. S. and Britain.But before many hours had passed it became clear that the rumor had been started as an attempt to determine the French attitude toward ratification of the agreements reached with the U. S. and British Governments. (TIME, May 10, July 19, 1926.)

Premier Raymond Poincarè, who also functions as Finance Minister, issued a statement to the effect that he was “working upon a solution of the question.” The great difficulty involved is 1) to get the Chamber and Senate to approve the Mellon-Berenger accord without a safeguarding clause (entitling France to stop payments to her creditors should Germany cease her reparation payments) or 2) to get Washington to accept the proposed safeguard clause.

The only immediate effect that this ballon d’cssai had last week was to cause M. Poincarè to assert that France would continue her debt payments to the U. S. and Britain by extending the temporary arrangement under which she has been paying $20,000,000 a year to each country. A fuller statement was promised “early next year,” the British agreement expiring in March; the U. S. in June.

*France now owes the U. S. $4,015,000,000; owes Britain about $3,265,000,000.