§ LORD LAMINGTON
, who had given Notice that he would ask Her Majesty's Government, Whether the statement is correct that out of the twenty-four directors of the Suez Canal Company only three are English; and, although every ship passing through the Canal must take a pilot, only one English pilot is employed? said, he did not propose to ask the first part of his Question, nor to say anything on the subject, which, at the present time, was agitating the public mind, except that it was manifestly impossible for the three English Directors to exercise any considerable influence in the management of the affairs of the Canal. The Question in regard to the pilots, however, was one that required some explanation?
§ EARL GRANVILLE
My Lords, with regard to the first part of the Question of the noble Lord, the assumption of the noble Lord is perfectly correct. The state of the Directorate of the Company is exactly as it was when the Shares in the Canal were bought. With regard to the pilots, I think the best thing I can do is to read a Report which has been prepared on the subject. The noble Lord will see that the point in question is one of those that are dealt with in the Provisional Agreement. The Report states that there are 17 pilots at Port Said to pilot vessels in and out of the harbour, and 97 Canal pilots. Of the Port Said pilots, 12 are Greek, two are French, one is English (Maltese), one Austrian, and one Italian. Of this number eight speak English, or can make themselves understood in English. Of the 97 Canal pilots, 27 are French, 24 Italians, 19 Greek, 17 Austrians, and 10 English (three Englishmen and seven Maltese). All the 97 can either speak English or make themselves understood; 45 can speak English, and 52 can make themselves understood in their directions for working the ship. This shows a much more satisfactory state of things than that stated in the Question of the 1665 noble Lord; but, at the same time, the Government are of opinion that much more should be done in the interests of our vessels, considering the preponderance of English shipping in the Canal. I cannot help taking this opportunity of making a few remarks with regard to this question. Your Lordships will remember that this Canal, which has been of such use to us, and which, on the other hand, owes its entire prosperity to this country, was not made with the concurrence of England, but very much in spite of, and with the opposition of, this country. Lord Palmerston opposed it on political grounds, some of which have now passed away. He also considered it a bubble Company, and the scheme quite impracticable, and he was in his right in doing this, although it was a mistaken view, on the very high engineering authority which had been furnished to him on that occasion. The opposition of Lord Palmerston had two important effects—one, that it influenced the conditions of the concession to the Company; and the other, that it afforded a stimulus in France, by the excitement of international amour propre, which, in the opinion of those conversant with the matter and competent to judge, really alone enabled large sums of money to be lent, and thus brought about the completion of the Canal. My Lords, for 10 years the Canal was anything but a commercial success; but during the last 4 years it has been not only a great success, but promises an increasing success in every manner. It promises to be highly remunerative to the shareholders; and I think the House will admit that the men engaged in a speculation of this sort accompanied by so much risk, unquestionably have a right to receive larger interest for their money than those who invest in an undertaking almost certain of success. The events of last year have given this country a peculiar influence in Egypt, and I believe that unless we lose our relative position among the nations of Europe, that influence is likely to continue. One of the immediate consequences of our military success was that our interest in Egypt, which has always been great, has increased, and many rich and energetic capitalists have turned their minds to enterprizes of great utility to that country. To all the promoters of these enterprizes I have always held the same language. 1666 With the entire concurrence of my Colleagues I have stated that we rejoice to see enterprize and capital directed to the improvement of Egypt. On the other hand, Her Majesty's Government are not inclined to commit themselves to industrial, economical, and commercial enterprizes, and the very fact of our peculiar position in Egypt makes such enterprizes less, rather than more, desirable. Yet we admit that there may be enterprizes of such an exceptional character that they ought not to be neglected by Her Majesty's Government if they tend to the advantage of this country, and, indeed, of the whole world. What Her Majesty's Government have a right to expect is, that they should not be called upon to give an opinion on any embryo plan, or to consider any plan unless it is put in a complete manner before them for their consideration. I may say, with regard to this particular point of the improved accommodation for sea-going vessels between the Red Sea and the Mediterranean, that I have had four different schemes before me; but, up to the present time, none of them have been presented in a manner which fulfilled the conditions we thought it necessary to make before assenting to anything of the kind. The increase of the traffic in the last four years and the quarantine difficulty have produced delays which have excited for the first time great discontent on the part of shipowners. One of the most obvious ways of meeting the difficulty was to arrive at some understanding with the Suez Canal Company. That was not merely our idea, but was the idea also of many of those who now find fault with the manner in which it has been carried out. It is quite clear that the existing Canal possesses many advantages. In the first place, it is made; in the next place, it is undoubtedly the shortest route from the Mediterranean to the Red Sea; and, lastly, it has been acquiesced in by all the European nations without exception. My Lords, a few months ago we had some confidential communication with the Directors of the Company, but for a long time there seemed to be no prospect of a satisfactory arrangement. Your Lordships must be aware that in this negotiation M. de Lesseps had a very strong position. In the first place, he believed that he had an exclusive right to the communication 1667 between the two seas, as far as the Isthmus was concerned. He also held that he had the power to give permission to anyone else. Now, the first point which was considered in these negotiations was whether this claim of M. de Lesseps to any exclusive right was valid or not. I do not know whether Her Majesty's late Government considered this point; but it seems fair for me to believe that they assumed an exclusive right, otherwise they would not have invested many millions of our capital in an enterprize of this sort—that they did not do so reckless a thing as embark in an enterprize which might turn out to be most unsuccessful, while if, on the other hand, it should turn out to be successful, it was liable to interruption and destruction by the construction of a rival Canal. Therefore, I have some right to assume that if they thought at all on the subject they believed that there was an exclusive right. There were two men in the Foreign Office as competent as any to give an opinion upon a question of this sort. They had no doubt as to the existence of an exclusive right; and we ourselves ascertained that the Egyptian Government had been advised by their legal adviser that this right existed. Our own Law Officers advised the same thing. We had the advantage of referring to the highest legal authorities on the subject. My Lords, the responsibility in a matter of this sort rests with Her Majesty's Government; but it is impossible for us, because one or two eminent counsel take a different view of the construction of a deed, to disregard the absolute conclusions of all the official advice that was open to us for the purpose. And I must say more, that though this advice was contrary to that which we should have wished to have, yet it did commend itself to our common sense. I cannot conceive, it being granted that there was an exclusive privilege, that that exclusive privilege did not mean something of substance. To say that it is an exclusive privilege of forming a Company is to say that it is what would turn out to be no exclusive privilege at all; and I cannot but think that if one of your Lordships gave an exclusive privilege to a Company not about to spend £20,000,000, but a much smaller sum, in building, say, an hotel, upon his estate, he would not, after having given 1668 it, feel himself at liberty, either legally or morally, immediately to give a concession to some other Company to establish an hotel in the same place. My Lords, I wish to point out that we never, in the course of these negotiations, made the slightest admission with regard to this claim of M. de Lesseps. We were obliged to admit it in the other House of Parliament the other day, when the scheme was condemned on the ground that there was nothing to be dealt with but a tabula rasa. Now, I wish to guard myself against saying that this is a question which can never be argued in the future. Supposing that the Canal Company, against their own interests, were to do nothing to facilitate communication between the two seas, and that they acted to their own disadvantage on the dog-in-the-manger principle of doing nothing, and preventing others from doing anything—I do not say that this state of things might not justify the exercise of considerable diplomatic pressure. But that is not the state of things at all. The Canal Company have already decided to widen and deepen their Canal. They have gone further than this. They state—and I have no reason to doubt it—that they have the means of making a double Canal, though not absolutely in the most advantageous way, on their own land, requiring no further concession at all, and that they would thus be able, undoubtedly for a great many years, to furnish very ample accommodation to the shipping and commercial interests. Now, the question remains as to whether, under these circumstances, the bargain we have made was so bad that Parliament should reject it, as they have a perfect right to do, and as was perfectly understood between ourselves and M. de Lesseps. If I had answered the Question put by a noble Lord yesterday, I should have gone in some detail into the advantages which we think are to be derived from the arrangement which we have made, and into some defence with regard to the concessions that we are willing to make in return. But I think the Report goes much more fully into these questions than I can do, showing the undoubted advantage of a double Canal, constructed on the best possible lines, such as we have agreed to urge upon the Egyptian Government to give a concession for the making of, and showing that it does give a very 1669 large, instead of a very insignificant, reduction of the burden on shipowners, both with regard to ships in ballast and ships in cargo. I believe the shipowners are very much mistaken in thinking that these different dues very much affect them; but they do affect, in a very large degree, the consumers. But, my Lords, the question is whether we could have obtained better terms than we have got. If I am right in saying that M. de Lesseps had this strong position—if he is right in saying that he had some title to claim a very considerable return to the shareholders for that which they at such risk have constructed, and if I show that on political grounds—as I am quite sure your Lordships will admit—it is much more advantageous in this matter that we should go heartily with France than in opposition to her. I do say that it is a subject which is well worthy of your Lordships' consideration. I should like the House to consider what are the alternatives. I have made allusion, as the noble Lord has done before me, to our position in Egypt at this moment. Our position in Egypt might have been different. We might have withdrawn our troops immediately from Egypt, and left everything purely to diplomatic agency; or, on the other hand, we might have annexed or conquered the country; but I think that, whatever we might have done with our Forces, it would not have affected our position with regard to doing anything which is unfair to the existing Canal Company. Even if we had conquered the country, I think it would have been, according to the modern usages of civilization, perfectly impossible to force the Egyptian Government to do anything illegal, or to do ourselves that which was unjust and illegal, with regard to an Egyptian Company composed chiefly of foreigners to that country. Therefore, I wish to know what is the alternative pressed on us. As regards the bargain, I can only say that during the three months' negotiations it has been the opinion of those who negotiated the terms, and of some of my most competent Colleagues who have been examining this subject, and given great labour to it, that these are the extreme conditions which we could obtain from M. de Lesseps. That being so, we thought it right to submit the scheme to Parliament for its consent to our carrying it out.
§ THE MARQUESS OF SALISBURY
My Lords, I should not have thought it necessary to make any observations in reply to the statement of the noble Earl, had not the noble Earl brought in the conduct of the late Government as in some measure a justification for the proposal now before Parliament. I confess I was surprised at the noble Earl's argument. He said it would have been a reckless proceeding on our part to have invested money in the shares of a Canal if it had been possible that a rival Canal should be created. Is he prepared to carry that view into private enterprize? Is he prepared to say that everyone is guilty of a reckless investment who invests in any railway or in any telegraphic works, or in any canal, with regard to which it is possible that a competing line or canal may be constructed? Is it not the case that many railways exist in this country where there is the fullest, the most open competition, which are yet exceedingly profitable undertakings? The noble Earl has, moreover, entirely ignored what Lord Beaconsfield put forward very prominently at the time of investing in the purchase of the Canal Shares—that, though a sound commercial operation, it was not principally or mainly a commercial operation; but that it had a political object—a political object which was well stated and well understood at the time—and the possibility that a rival Canal could be created would not in the slightest degree have affected the political aim which Lord Beaconsfield's Administration had in purchasing those shares. As a matter of fact, if by this or any other arrangement a rival Canal were to be commenced to-morrow, it would still have been not only a political step in the highest degree expedient, but it would have been a successful and profitable financial operation, and its profit would not have been seriously interfered with by the creation of a competing Canal. It is evident no competing Canal could ever have obtained support at all until the profits of the first Canal had arrived at such a point as to invite investors to take part in such an undertaking. I therefore entirely repudiate the idea that Lord Beaconsfield's Government gave a constructive sanction to this claim of monopoly on the part of the Suez Canal Company. With respect to the legal considerations referred to by the noble Earl, I do not 1671 conceive that it is my business to argue them, nor should I be likely to do so with success. But the noble Earl must be well aware that legal opinions on the subject are much divided, and that authorities quite as great as on his side can be quoted against the view that M. de Lesseps has any monopoly over the junction of the two seas. The noble Earl rested his ease on the use of the word "exclusive" in the concession of 1854; but he did not take notice of the fact that the concession of 1854 had of itself no validity or value whatever. It was still-born, because it never received that which alone could give it validity or value—namely, the sanction of the Porte. Twelve years later the Porte gave its sanction to the Agreement of February, 1866, in which there was a clause revising somewhat vaguely by-gone Agreements; but the whole question lies in this—whether the words used in the Firman of the Porte giving sanction to the concession of 1866 are wide enough and specific enough to carry by implication that which they did not say explicitly—namely, the conferring on M. de Lesseps and the Company the strange prerogative of barring for over 100 years all other industry and enterprize in the junction of the two seas by which such a vast commerce is carried? This is a matter, my Lords, which Parliament will have to argue carefully, and it will be argued by disputants much better qualified than I am to deal with it; but I venture to say that even if legally the words did convey the meaning which Her Majesty's Government, in my opinion, most imprudently put upon them, I doubt very much the competence of the Sultan or the Khedive to make an Agreement that would debar nations from the natural right of passage across the Isthmus of Suez for the commerce of the world. Supposing there had been some improvement in the Dardanelles or the Cattegat, would it have been within the competence of the Sultan's Government or of the Danish Government to place an artificial limit upon the passage of the commerce of the world through those channels?
§ EARL GRANVILLE
I should like the noble Marquess to speak so that my noble and learned Friend on the Woolsack shall hear his remarks.
§ THE MARQUESS OF SALISBURY
What I wished to say was, that this was 1672 more than a mere legal question; it deals with that far higher question of how far Governments have the power, without appeal, to confer upon persons receiving concessions a prerogative which shall have the effect of preventing the natural access to means of transit which, as a primâ facie right, is possessed by the commerce of the world. That is a point which I desire to commend to the consideration of the noble Earl, and it does not rest merely upon legal grounds. The noble Earl has asked what we shall do in the alternative. Well, I confess that the objections which at first sight I feel most strongly to the proceedings of the Government are that they confound the practical difficulty with the legal difficulty—that on account of the practical difficulties of the moment, which may or may not be genuine, they are raising a legal and moral obstacle which, when those practical difficulties are removed, will yet remain behind. It may be possible that another Canal could not now be cut without those diplomatic complications which, as the noble Earl says, this country desires to avoid. Upon that point I do not wish to pass a judgment. But if that is so now, it may not always be so. The difficulty may pass away this year, next year, a short time hence. If this improvident Agreement is not concluded we shall then be in a position to make use of any opportunity we may possess, and by the aid of British capital to secure a British Canal from sea to sea. If this bargain is concluded it will give a practical security to the monopoly claimed by M. de Lesseps, which will be an impediment to the chance of such a desirable end whenever circumstances may be favourable to our achieving it in the future. That is the great danger which I apprehend from the Agreement which the noble Earl has defended. There is much to be said as to its improvidence in detail; but those are questions for argument when the project comes nearer to us, and we have to pronounce a practical decision upon it. For the present I will content myself with regretting that from words used in the other House, and certainly in the conduct of the arrangements, the tendency of Her Majesty's Government has been to give an unnecessary confirmation to the monopoly claimed by M. de Lesseps—a monopoly which could not but be disadvantageous 1673 to the commerce of this country?
THE LORD CHANCELLOR
My Lords, there is one thing the noble Marquess has said to which I am able to give my cordial approval, and that is that the question of the effect of the concession to the Suez Canal Company, the rights of that Company, and the proper course to be taken by this country with respect to it under the present circumstances, rises into a higher region than that within which either I myself or any other English lawyer has a right to speak with authority. In that I entirely agree with the noble Marquess, and I shall be glad if in the discussions on this subject that is borne in mind. We occupy at this moment a position in Egypt which makes it, as it appears to me, of the highest obligation that we should both ourselves respect—and, as far as we have any influence, that we should not use that influence so as to lead the Khedive not to respect—the obligations which he and his Predecessors may have entered into with those persons by whose money the Canal has been made. It was a great, it was an extraordinary undertaking of doubtful success, of great difficulty, requiring the outlay of very large capital; and it could not have been entered into, or accomplished, except on the faith of public engagements of an important and peculiar character. Could any private individual have been expected to enter into such an undertaking or advance such a capital? I do say that if ever there was a case in the history of the world in which the engagements of Governments and Sovereign Powers towards private persons required to be considered and acted upon uberrimâ fide this is the case; and no course could have been less honourable or less creditable to a country like ours than if, having obtained an accidental superiority of position in Egypt through political movements to which we were unwillingly led, though forced into them by the view which we took of the interests and duty of our country—if we had availed ourselves of that position to go to the right or to the left in opposition to private rights contracted by the Government of that country under such circumstances; and more especially when those private rights were intimately 1674 connected with interests cherished and valued by a great neighbouring nation, whose position in Egypt, under the peculiar circumstances of the case, we were under special obligations to consider and to respect. I have said that there was one part of the noble Marquess's speech with which I entirely agreed, and that is when he laid aside the technical authority of English lawyers, proceeding upon principles of narrow verbal construction, as sufficient to rule this question; but there was another part of his speech which I listened to with unfeigned surprise. He referred to high political, or, I may say, cosmopolitan considerations as paramount to all others on this question. He seemed to speak as if the Isthmus of Suez, before the Canal was made, had been a natural maritime highway and channel for the commerce of the world—as if it had not been any part of the Egyptian territory; as if no territorial concession had been required for it; or as if, the Canal having once been made, the geographical nature of the world was changed, and all territorial interests were to give away to the convenience of the nations navigating the Canal. My Lords, I think that was an-argument founded upon forgetfulness of the fact that the Canal came into existence by means of these concessions, and by means of the money which the Suez Canal Company laid out upon them. There is no analogy whatever between this case and that of the Straits of the Bosphorus and the Dardanelles or any other natural maritime passage in which all the world may have an interest. The territory of the Isthmus of Suez belongs to the same Power to which it belonged before; and whatever footing international commerce has obtained upon that territory, it has obtained by means of these engagements; and whatever may be the true construction of these engagements, nothing will induce me to believe that your Lordships will ever consent to enlarge that international interest by violence. My Lords, I have thought it necessary to say so much. I quite agree with the noble Marquess that the time for a detailed discussion of this question has not yet arrived; but I could not help taking exception to the manner in which the noble Marquess has stated the case.