By this treaty the whole of Mesopotamia up to Basra became our zone of interest, whereby the whole British rights, the question of shipping on the Tigris, and the Wilcox establishments were left untouched, as well as all the district of Bagdad and the Anatolian railways. The British economic territories included the coasts of the Persian Gulf and the Smyrna-Aidin railway, the French Syria, and the Russian Armenia. Had both treaties been concluded and published, an agreement would have been reached with England which would have finally ended all doubt of the possibility of an Anglo-German co-operation. GERMAN NAVAL DEVELOPMENT Most difficult of all, there remained the question of the fleet. It was never quite rightly judged. The creation of a mighty fleet on the other shore of the North Sea and the simultaneous development of the Continent's most important military power into its most important naval power had at least to be recognized by England as uncomfortable. This presumably cannot be doubted. To maintain the necessary lead and not to become dependent, to preserve the supremacy of the sea, which Britain must have in order not to go down, she had to undertake preparations and expenses which weighed heavily on the taxpayer. A threat against the British world position was made in that our policy allowed the possibility of warlike development to appear. This possibility was obviously near during the Morocco crisis and the Bosnian question. People had become reconciled to our fleet in its definite strength. Obviously it was not welcome to the British and constituted one of the motives, but neither the only nor the most important motive, for England's joining hands with Russia and France. On account of our fleet alone, however, England would have drawn the sword as little as on account of our trade, which it is pretended called forth her jealousy and ultimately brought about war. From the beginning I adopted the standpoint that in spite of the fleet it would be possible to come to a friendly understanding and reapprochement if we did not propose new votes of credit, and, above all, if we carried out an indisputable peace policy. I also avoided all mention of the fleet, and between me and Sir Edward Grey the word was never uttered. Sir Edward Grey declared on one occasion at a Cabinet meeting: "The present German Ambassador has never mentioned the fleet to me." UNDERSTANDING POSSIBLE. During my term of office the then First Lord, Mr. Churchill, raised the question of a so-called naval holiday, and proposed, for financial reasons as much as on account of the pacifist inclinations of his party, a one year's pause in armaments. Officially the suggestion was not supported by Sir Edward Grey. He never spoke of it to me, but Mr. Churchill spoke to me on repeated occasions.