Italy's position,
in connection with the Southern Slav question, and have pointed out that a
settlement which follows even approximately the lines of nationality would
assign the Trentino, the town of Trieste (as a free port), and a strip
of Western Istria to Italy, but the remainder of the coast from Cape
Promontore to the Bojana river to the new "Jugoslavia." There are, however,
other directions in which Italy may claim compensation for her friendly
attitude towards the Triple Entente. She has already occupied the rocky
islet of Saseno, opposite Valona, and in the event of the collapse of
Austria-Hungary, she may demand the whole bay of Valona, as the strategic
key to the Adriatic, and even a general protectorate of the embryo Albanian
State. The establishment of a miniature Gibraltar on the eastern side of
the Straits of Otranto is a step which neither France nor Britain would
oppose, if Italy should insist upon it; but it may be questioned whether
she would not thereby be laying up stores of trouble for a distant future,
altogether incommensurate with any possible advantages which might accrue.
Indeed, Italy would probably be well advised to abandon all idea of an
Albanian adventure (which, originally conceived as a counterstroke to
Austrian aggression, would lose its point if Austria disappeared from the
scene), to leave the Greeks a free hand in south Epirus, to cede to them
Rhodes and the other islands occupied during the Tripolitan War, and then
to secure, during the partition of Turkey, the reversion of Cilicia and the
Gulf of Alexandretta. It is in any case clear that the Powers of the Triple
Entente will raise no objections to such action on the part of Italy, and
are resolved to show every consideration to a power whose great and vital
interests in the Mediterranean in no way conflict with their own.

Sec.12. _The Balkan Situation: Bulgaria and Greece._--The creation of a
Greater Roumania and of a new Southern Slav State would transform the whole
Balkan situation, and therefore obviously involves material concessions to
Bulgaria and Greece.

(A) If Roumania succeeds in redeeming her kinsmen across the northern
frontiers, she cannot be so ungenerous as to insist upon retaining
territory whose population is overwhelmingly Bulgarian, and the least which
might be expected from her would be the retrocession to Bulgaria of her
bloodless acquisition during the second Balkan War. This means a reversion
to the bou