11,977.
No. 258.
(CYPRUS.)
The RIGHT HON. the EARL GRANVILLE, K.G., to the RIGHT HON., the EARL OF DUFFERIN, K.P., G.C.M.G., K.G.B.
(DRAFT.)
PUBLIC RECORD OFFICE
Reference :-
། ། ། །
C.O.
885
(Concurred in by Law Officers, see Foreign Office letter 6th July 1881.)
MY LORD,
HER Majesty's Government have had under their consideration Mr. Goschen's
Foreign Office, despatch No. 374 of the 10th ultimo, forwarding a Note from the Porte relative to the
1881. question of the application of the Cyprus surplus for 1879-80 to the payment of the arrears due on the Ottoman guaranteed loan of 1855.
The Note states, first, that the Ottoman Government do not consider the sum of 85,000l. as the whole of the surplus revenue of Cyprus for that year; secondly, that the revenues of Cyprus having been pledged to the administration of the six indirect contributions by the Convention of November 22nd 1879, that portion only of the revenues which preceded the conclusion of the said Convention can be affected to the 1855 loan; thirdly, that for the future the Turkish Government will insist on the conversion of the surplus at the rate of 100 piastres to the Turkish pound. I will deal first with the second point, which refers to the assignment of the tribute to the administration of the six contributions. Her Majesty's Government are advised that they are entitled to treat the surplus revenues of Cyprus as part of the revenues of Turkey which are charged by Article 3 of the Convention of 1855 with the payment of the interest and sinking fund of the 1855 loan, and they cannot admit the right of the Porte to assign them to later creditors. predecessor to Sir Henry Layard on December 23, 1879, in which he stated that A despatch was addressed by my Her Majesty's Government could not "accept or recognise the transfer to any other person of the Sultan's right to receive this payment, nor could they admit any liability immediate or contingent to pay it to any person except the Sultan. Further, that any debt owing by the Porte to Her Majesty's Government must of necessity stand as a first charge against the said surplus.”.
16
66
I have to instruct your Excellency to address a note to the Porte_calling their attention to the communication in this sense made by Sir H. Layard in January 1880, and to state that Her Majesty's Government do not recognise the assignment of the Cyprus revenues to the administration of the six contributions.
With reference to the first and second points raised in Assim Pasha's Note, I may refer your Excellency for a statement of the views of Her Majesty's Government to the letter from the Board of Treasury of February 16 last; you will see that the Board, after a careful consideration of the subject, consider that the accounts of the Government of Cyprus previous to the transfer were fairly and impartially examined by Sir R. Biddulph, that the claims for deductions made by him were reasonable, and they assumed, until better informed, that the annual payment was properly fixed by him at 11,121,950 piastres, subject to a temporary deduction of 29,574 piastres on account of the forced loan of 1877.
With regard to the rate of exchange the Board were of opinion that the payment to the Porte should be made at the average rate which prevailed during the 5 preceding occupation.
years
If the Ottoman Government wish to re-open the discussion of these points, Her Majesty's Government will be prepared to do so at a fitting opportunity; but in view of the claim which has been put forward to ignore the rights of the guaranteeing governments under the Convention of June 27, 1855, and to transfer part of their security to the parties of the Convention of November 22, 1879, Her Majesty's Government have decided in order to maintain the prior claim of the guaranteeing
▲ 19916.-997. 25.-19/84.
I
I
12 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO