(b) These duties to continue to be levied in accordance with the German tariff.
(c) A line of Customs houses to be temporarily established on the Rhine and at the boundary of the têtes des ponts occupied by the Allied troops; the tariff to be levied on this line, both on the entry and export of goods, to be determined by the Allied High Commission of the Rhine territory in conformity with the instructions of the Allied Governments”.
V. The German Counter–proposal, as Transmitted to the United States Government, April 24, 1921
The United States Government have, by their Note of April 22, opened the possibility, in a way which is thankfully acknowledged, of solving the reparations problem once more by negotiations ere a solution is effected by coercive measures. The German Government appreciates this step in its full importance. They have in the following proposals endeavoured to offer that which according to their convictions represents the utmost limit which Germanyʼs economic resources can bear, even with the most favourable developments:
1. Germany expresses her readiness to acknowledge for reparation purposes a total liability of 50 milliard gold marks (present value). Germany is also prepared to pay the equivalent of this sum in annuities, adapted to her economic capacity up to an aggregate of 200 milliard gold marks. Germany proposes to mobilise her liability in the following way:
2. Germany to raise at once an international loan, of which amount, rate of interest, and amortisation quota are to be agreed on. Germany will participate in this loan, and its terms, in order to secure the greatest possible success, will contain special concessions, and generally be made as favourable as possible. Proceeds of this loan to be placed at the disposal of the Allies.
3. On the amount of her liability not covered by the international loan Germany is prepared to pay interest and amortisation quota in accordance with her economic capacity. In present circumstances she considers the rate of 4 per cent the highest possible.
4. Germany is prepared to let the Powers concerned have the benefit of improvements in her economic and financial situation. For this purpose the amortisation quota should be made variable. In case an improvement should take place, the quota would rise, whilst it would correspondingly fall if developments should be in the other direction. To regulate such variations an index scheme would have to be prepared.
5. To accelerate the redemption of the balance, Germany is ready to assist with all her resources in the reconstruction of the devastated territories. She considers reconstruction the most pressing part of reparation, because it is the most effective way to combat the hatred and misery caused by the war. She is prepared to undertake, herself, the rebuilding of townships, villages, and hamlets, or to assist in the reconstruction with labour, material, and her other resources, in any way the Allies may desire. The cost of such labour and material she would pay herself. (Full details about this matter have been communicated to the Reparation Commission.)
6. Apart from any reconstruction work Germany is prepared to supply for the same purpose, to States concerned, any other materials, and to render them any other services as far as possible on a purely commercial basis.