The Shah and Anglo-Persian
THE Anglo-Persian oil dispute has been formally discussed by the League of Nations Council and adjourned for five weeks to give time for the Persian Government to prepare its case. No serious complaint can be made of that, though there is something to be said for satisfying yourself as to the legality of an act before it is committed rather than after. The real situation, of course, is clear enough. His Imperial Majesty Riza Shah has acted and His Imperial Majesty's Government has now to fixid justification for the action. The dis- cussions that must now be entered on may lead to the elaboration at Geneva of a new technique in the handling of disputes between a government and a foreign con- ces.sionnaire. Nothing could be more useful. Persia and Mexico are by no means the only countries where that kind of issue is apt to arise. From that point of view there is something to be said for the transference of the case from the Hague, to which the British Govern- ment (after some remarks a little overcharged with acerbity) proposed to refer it, to Geneva. Legal issues are clearly involved, and' the League Council will almost certainly consult the Permanent Court on points of law, but if it is a question of finding a reasonable modus rivendi. the more flexible procedure of the Council lends itself better to that than the strictly legal atmosphere of the Hague.
The probability is that there will be a protracted inquiry by a Commission of Experts nominated by the Secretary-General. It remains to be seen whether the terms of reference will be simply the right of the Persian Government to abrogate the concession by a unilateral act—about which there can be no difference of opinion at all—or whether the investigations will extend to all or any of the list of reasons adduced by the Persian Government in support of its action. Some of these complaints have no more relevance than the preliminary pleadings in a civil case in this country ; they are put foe ward at this stage in order to extend as widely as may be the issues for adjudication. Others, dealing with problems of accountancy and questions of money, are vital issues on which much will be said. They will turn on matters of interpretation in the light of British commercial law and practice. Can a Com- 'mission appointed by the League deal with such matters, which, incidentally, could have gone to arbitration under the original concession ? If so, the League will be setting a new precedent, and the verdict, if it is to carry conViction and not evade the issue, must have behind it the kind of experience and legal authority which attaches to a decision by the Commercial Court in this country rather than by a commission of laymen, however distinguished. Fortunately the League has an ample supply of qualified experts to draw on.
The dispute is unique in one respect in that it centres round the personality of an oriental monarch, who exercises a control no less absolute than that of his neighbours in Turkey and Afghanistan, and is probably wiser than either. Riza Shah is a twentieth-century Frederick the Great in petio. Born of good yeoman stock, he has risen from the lowest ranks of the Persian Cossack Brigade. His early years were spent under Russian officers. His education was not bookish ; he can read and write but seldom troubles to do either, with the result that he has an excellent memory and is a good judge of men—and horses. He is a sworn believer in force ; nearly- half the• revenues of the country go to the maintenance of the Army, Navy and Air Force. The Army placed him and keeps him in power : the American Financial Adviser who tried to check the War Office accounts was rewarded by contemptuous dismissal. He has no love for tall poppies in the political field, as some of the leaders of the pre-War regime discovered to their cost. Whether at home or abroad he has always played, with prudence, for high stakes, and won, not by bluff but by a willingness to bring any issue to the arbitrament of force. With Russia, Turkey and Afghanistan he has treaties of non-aggression, but he views Iraq with a certain jealousy—which goes far to explain the present situation.
He might have borne with a royalty of £800,000 for Persia, on an export of six million tons of oil, had not Iraq secured £400,000 a year pending production of oil and four shillings (gold) a ton thereafter. He might have consented to the restriction of exports to six million tons were there no preparations on foot to pipe an even greater tonnage to the Mediterranean from Iraq. He might even have resigned himself to loss of capital and revenue from the depreciation of sterling had not Iraq obtained payment of her royalties on a gold basis. The parable of the labourers in the vineyard and the penny a day makes no appeal to him. These considerations can scarcely be urged before any tribunal concerned with legalities, or even with equities, but they arc ever in his mind.
The part played by personalities is one of the impon- derables in the situation. The Chairman of the Anglo- Persian Oil Company, who is also Chairman of the Iraq Petroleum Company, interviewed on his return from America, was reported as saying : "The Shah is a personal friend of mine ; I have often met him and discussed business matters with him. It had never occurred to me for a moment that he would have countenanced such drastic action. . I had always hoped that nothing would interfere with the personal friendship which I enjoy with the Shah."
Such an utterance introduces an clement of doubtful value. Business is business, commoners are commoners, and kings are kings. Kings—particularly in the East— are not accustomed to hear commoners, however eminent in commerce, claiming publicly to enjoy their personal friendship and associating . business relations closely with it. If the Shah were less concerned personally in the Anglo-Persian affair that would be of no great consequence ; but however proceedings at Geneva go there must sooner or later be negotiations between the Company and the Persian Government, and it is well to realize that on the side of the latter there will be only one plenipotentiary—the Shah. That fact complicates matters considerably, for the Shah is not at Geneva and will not come there. In his Oriental capital he will be completely out of range of any conciliatory influences that may be active in the League city, and the delegate he sends may find himself embarrassingly distracted between the dictates of his own judgement and the orders of his Imperial and somewhat imperious master. But provided the normal operations of the Anglo-Persian are permitted to continue in the interval, a rapid settlement is not a matter of urgency. The pipe-lines, of course, are highly vulnerable, running exposed for hundreds of miles over plain and hills, but the Persian Government has pledged itself to avoid any act likely to aggravate the dispute, and in its own interests it may be expected to observe the pledge.
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