Mr. BERRY. There are few exports of importance. There is canning of fish taken in from the gulf. There is the export of some skins and dates. It is relatively unimportant economically to us.

Mr. FLOOD. Or to anybody else.

Mr. BERRY. It was important to the Italians.

Mr. FLOOD. Why?

Mr. BERRY. For absorbing their surplus population. In Cyrenaica, of course, there was farm land and they could expand a bit.

Mr. FLOOD. Do we have a point IV program channeled for the area? Mr. BERRY. We have one in the process of being channeled to the area; yes, sir.

Mr. FLOOD. What will be the nature of it?

Mr. BERRY. It will be educational, agricultural, the training of people to help the local people. Education is what those people need most. There are practically no teachers in the country. They have been coming primarily from Egypt and other Arab lands.

Mr. FLOOD. If there is any future economically it is agrarian.
Mr. BERRY. That is true.

Mr. FLOOD. Are there any seaports?

Mr. BERRY. Yes, sir; Tripoli and Bengasi.

Mr. FLOOD. Is there any possibility or future in the revival of the ancient seafaring trading areas from the interior?

Mr. BERRY. That depends largely upon the finding of water. That is the scarcest commodity in that part of the world.

Mr. FLOOD. What are the mineral potentials and what is being done about them?

Mr. BERRY. I know of no exploration upon that since the end of the war. The Italians did a certain amount of that, looking for oil, unsuccessfully. They were looking for other minerals also, also unsuccessfully.

Mr. FLOOD. It is rather a bleak prospect?

Mr. BERRY. It is not a brilliant one.

Mr. FLOOD. What is going on with the French in Morocco? (Discussion off the record.)

Mr. BERRY. There is to be improvement of one naval port. There has been no difficulty about that, because it is as important for the defense of France and Western Europe as it is important for the defense of America.

Mr. FLOOD. What is the port?

Mr. BERRY. Port Lyautey.

Another problem which arises in Morocco is the protection of the rights of our American traders there. Since the imposition by the French of import and exchange controls we have been engaged in continuing talks with the French for the purpose of protecting the rights of our traders. These import controls were necessitated by the ECA agreement between France and this country. Morocco was included in this agreement. We assented to the application of these controls with the understanding that they be administered in a nondiscriminatory manner.

Nonetheless the American traders established in Morocco thought that they should enjoy the full treaty rights despite the ECA agreement with France. In the protection of the interest of American businessmen we were discussing this with jthe French when they decided to take the matter to the International Court of Justice for the determination by the Court as to the exact status of American treaty rights in Morocco.

That is where it stands today, before the Court. There will probably be no decision this year. Maybe it will not be until early next year. In the meantime we will continue, in the future as we have in the past, to do our best to protect the rights of American businessmen and preserve the status quo.

Mr. FLOOD. That is of interest to us, because it might periodically arise on the floor in the form of amendments to various instruments that appear in the House.

Mr. BERRY. Yes, sir.

Mr. FLOOD. What is the significance of the recent political difficulties of the Sultan?

Mr. BERRY. Those difficulties, I believe, sprang from the desire on the part of the French to curb the activities of so-called extremists in the Moroccan Government.

Mr. FLOOD. What do you mean by extremists; nationalists or Communists?

Mr. BERRY. They say "extremists". It can mean either or both. Mr. FLOOD. What do you think it means in Morocco?

Mr. BERRY. I think from the French point of view it means nationalists.

Mr. FLOOD. Arab nationalists?

Mr. BERRY. That is right.

Mr. FLOOD. Arab Moroccan nationalists?

Mr. BERRY. Yes.

Mr. FLOOD. It seems to be significant because of nationalistic aspirations of the Moroccan nationalist groups?

Mr. BERRY. That is true.

Mr. FLOOD. Rather than Communist infiltration?

Mr. BERRY. That is correct, sir.

Mr. FLOOD. At least in this incident.

Mr. BERRY. And I think that incident is now passed.

DETAIL OF ACTIVITIES IN THE NEAR EAST

Mr. FLOOD. What is the status of the Dardanelles treaties vis-à-vis Russia?

Mr. BERRY. There is no change in those treaties. As you probably recall Russia a few years ago proposed that the Montreaux Convention, which governs the status of the straits today, be amended so that Russia could have on the straits a bit of territory she could call her own for the defense of the straits.

Mr. FLOOD. On each side?

Mr. BERRY. It never got quite that far.

Mr. FLOOD. We have requested the right to be members of this, have we not?

Mr. BERRY. To participate; that is right.

Mr. FLOOD. Have we been accepted? Are we a part thereof?

Mr. BERRY. It has not come up yet because there has been no agreement to renew it. We, of course, have expressed our point of view directly to the Turks, who have accepted it, as well as to the Russians.

Mr. FLOOD. The Turks are giving evidence of being very stout fellows about this whole thing; are they not?

Mr. BERRY. They are indeed. Admirably so.

Mr. FLOOD. You indicated that the Shah of Iran was very well pleased with his reception here and as a result of that he went back with a very high regard for us, and so on. If that is so how do you account for the fact that our experience with Iran in recent months, since he returned, has been anything but satisfactory? I got the impression that the contrary is rather the fact.

Mr. BERRY. I do not believe, sir, that that stems from the Shah. He has been very well disposed toward us. I believe on his trip to America he learned a great deal. It was a fine educational experience for him. The difficulties that have come to a head in Iran in the last few months have been difficulties developing over the course of years. Only recently we became more conscious of them. There is the deteriorating economic situation, a series of bad crops, a succession of one government after another, each one being incapable of exerting fully its authority. I think that has changed to an extent.

Mr. FLOOD. Are the British going to stand up with reference to their rejection of any overtures from Iran and Russia on any oil arrangements, rearranging the status quo on oil? Will the British stand up?

Mr. BERRY. I believe the British will try to maintain their oil concession there, the Anglo-Iranian Oil Co.

Mr. FLOOD. You are aware that the Russians are asking the Iranians to change it, just recently.

Mr. BERRY. I believe that is not inspired by the Russians. That is a long-standing desire on the part of the Iranians, to secure a more favorable concession. It is in the process of renegotiation at this time.

Mr. FLOOD. You think they are using the Russians as a club, perhaps?

Mr. BERRY. They might be using them for that purpose, although I believe that antedates any new Russian move.

Mr. FLOOD. Is there a nationalist movement in Iran analogous to that in Morocco that we just spoke of, or is the political unrest a Communist attempt to cloak their Red activities with nationalism as they do in southeast Asia?

Mr. BERRY. There is a Tudeh Party, which is the Communist-front party that is supported by the Russians. That party is causing a great deal of mischief in Iran by exploiting discontent, by taking situations that arise from the economic condition rather than the political condition and distorting them.

Mr. FLOOD. Tell me this: Have we, the United States, been maneuvered by Russia and the Communists generally into the same sort of position with reference to the people of Iran and their nationalist inspirations or democratic inspirations as has happened in the past? My friend, Mr. Clevenger, would like to say that is an exhibition of the republican form of government operating, as opposed to whatever they have.

Are we being placed in the position there again, as in Asia, of being on the wrong side of the fence, supporting the vested interests, socalled, whatever they are, and the tyranny of an autocratic regime as against the inherent rights of a free people and so on and so on? Are we getting outmaneuvered there, too?

Mr. BERRY. I do not believe we are being put in that position in Iran.

Mr. FLOOD. You do not think so?

Mr. BERRY. I think we are not. As you know, the Shah very recently has made available a great part of the royal estates for distribution to local farmers. There is none of the feeling of colonialism that existed in India and part of Asia, the resentment against the west which for generations exploited that part of the world.

Mr. FLOOD. You feel they have a longer tradition of national sovereignty?

Mr. BERRY. That is correct.

Mr. FLOOD. There is not quite an analogy?

Mr. BERRY. That is right.

Mr. FLOOD. We have been faced at this table for many years by people from various sections of your shop, as this question of international communism was developed, who said that we could feel rather safe in knowing that the religious tenets of the oriental faiths of all descriptions were of such a nature that they would be a bulwark for that reason alone, against the encroachments of an atheistic Communist philosophy. There seems to be some doubt whether that is so or not, in view of the developments of recent years.

Can you comment on that?

Mr. BERRY. I should say, sir, that communism is a deterrent in a Moslem state but not the great bulwark that some people have thought in the past.

Mr. FLOOD. Communism is a bulwark? You mean religion.

Mr. BERRY. Religion, sir, is a deterrent to the advance of communism.

Mr. FLOOD. You have stated the question. That is just what I said. Why is that so, in view of the fact that most of your people for so many years have assured us that if and when the present situation arose we could feel rather certain that this great religious bulwark would be an insurmountable barrier, that the orientals would never accept communism on the basis of economy or nationalism or anything else, that this classical religious concept would prevent communism from succeeding? That is not so.

Mr. BERRY. I think that is not so. I would attribute it to the fact that the Iranians and the Indians are interested in the developIment of their own countries. They are not interested in becoming satellites of another great power. They are interested in their own self-advancement.

They are not deceived by an imported idea that is handed out to them. Religion with us, in a sense, is a way of life, but it is not all inclusive. There are business people, too, who are thinking of their own advancement.

Mr. FLOOD. Then you feel that we would be well advised if we did not rest upon that oar?

Mr. BERRY. I do, indeed.

Mr. FLOOD. The religion of the East we can no longer consider a barrier to communism?

Mr. BERRY. That is correct. It is a deterrent but not a barrier. Mr. FLOOD. And the fact that, in your area especially of the Mediterranean Basin, there is a strong Arab and hence Moslem religious faith cannot be looked to alone to stop the infiltration of communism? Mr. BERRY. I agree completely.

ADDITIONAL REMARKS ON AFRICA

Mr. FLOOD. Do you have anything to say with reference to the Sudan?

Mr. BERRY. The Sudan?

Mr. FLOOD. Yes; as between Egypt and Britain?

Mr. BERRY. That is one of the chief outstanding problems between Egypt and Great Britain.

Mr. FLOOD. I have in mind the colonial, imperial concept, hemisphere defense of Africa and the concentration of the imperial line? Mr. BERRY. Yes.

Mr. FLOOD. Southeast, southwest, or south: Do those things involve any problems in which we are interested in Sudan, and what we are concerned with?

Mr. BERRY. The problem of Sudan, it seems, is an emotional problem, growing out of the problems that exist between Egypt and England, because the British have for generations controlled Egypt, when Egypt thinks how wonderful it might be, for their full enjoyment, to have the British out of the canal zone in Egypt.

Mr. FLOOD. Is there a nationalist movement among the Sudanese? Mr. BERRY. No; I have not heard of any.

Mr. FLOOD. Is it of any concern to us, because of the relationship to the Belgian Congo because of the desirability, perhaps, of getting scarce materials out of Africa?

Mr. BERRY. Yes; we are very definitely concerned with that. We have taken action with the British and with the Egyptians, urging that they settle the disputes between themselves amiably.

Mr. FLOOD. Where is the point of exit for those materials?

Mr. BERRY. They go out from Matadi, the port for Leopoldville, on the west coast of Africa; they also go overland from Elizabethville to the east coast.

Mr. FLOOD. Where do they leave Africa, I mean?

Mr. BERRY. They leave on the east coast of Africa.

Mr. FLOOD. What port?

Mr. BERRY. From Beira, Portuguese East Africa.

Mr. FLOOD. You mean the Portuguese control the east Africa ports? Mr. BERRY. They control the terminus of the railroad from Southern Rhodesia.

Mr. FLOOD. They do?

Mr. BERRY. Yes.

Mr. FLOOD. Do you want to comment generally upon what we are advised from different sources as considerable infiltration of communism among the African tribes?

Mr. BERRY. Yes. That is one of the reasons that we propose to open this post at Abidjan. Our information is that a Communistfront party has its stronghold in Abidjan. From there it infiltrates members through Black Africa, going even to Leopoldville. On the belief that infiltration does exist and is a potential danger, we would