military
operations.

4. Cessation of economic war and reparation of damages sustained by
private persons through the economic war.

5. Resumption of commercial intercourse and the same provisionally on
the basis of the old commercial treaty and twenty years' preference
subject to restriction in respect of any Customs union with
neighbouring countries.

6. Mutual assistance in raw materials and industrial articles.

A further point was contemplated, dealing with the evacuation of the
occupied areas, but the formulation of this had to be postponed until
after consultation with the German Supreme Military Command, whose
co-operation was here required owing to the mingling of German and
Austro-Hungarian troops on the Russian front. The Army Command has
indicated a period of at least six months as necessary for the
evacuation.

In discussing this draft with the German delegates two points in
particular were found to present great difficulty. One was that of
evacuation. The German Army Command declared categorically that no
evacuation of the occupied districts could be thought of until after
conclusion of the general peace. The second difficulty arose in
connection with the question as to treatment of the occupied
districts. Germany insisted that in the peace treaty with Russia it
should be simply stated that Russia had conceded to the peoples within
its territory the right of self-determination, and that the nations in
question had already availed themselves of that right. The plain
standpoint laid down in our draft we were unable to carry through,
although it was shared by the other Allies. However, in formulating
the answer sent on December 25, 1916, to the Russian peace proposals a
compromise was, after persistent efforts on our part, ultimately
arrived at which at least prevented the full adoption of the divergent
German point of view on these two points. In the matter of evacuation
the Germans agreed that the withdrawal of certain bodies of troops
before the general peace might be discussed.

In the matter of annexations a satisfactory manner of formulating this
was found, making it applicable only in the event of general peace.
Had the Entente then been disposed to make peace the principle of "no
annexations" would have succeeded throughout.

Even allowing for the conciliatory form given through our endeavours
to this answer by the four Powers to the Russian proposals, the German
Headquarters evinced extrem