Debt to France

After months of negotiations, a Franco-Russian commission which was convened in Paris to find a way of reading some meaning into Russian recognition by France, ended its words, vacated its chairs, dispersed.

When, last year, France recognized Russia (TIME, Nov. 10, FRANCE), that act literally meant only the appointment of ambassadors. A commission was formed to come to an agreement on the debts which France said Russia owed her and the reparations which Russia said France owed her.

Report from Paris had it that the commission recommended: 1) that Russia be asked to recognize 10,000,000,000 gold rubles ($5,000,000,000) or about two-thirds of her debt to the

French;-2) that a moratorium of ten years be granted in respect of principal and interest, provided that the back interest, amounting to 4,000,000,000 gold francs ($800,000,000) be immediately paid. But, as France would accept paper instead of gold francs, the amount is cut by three-quarters.

There seemed small hope of Russia accepting such an arrangement.

* Russian bonds are held by a large number of French citizens and it is particularly difficult for any French Government, no matter how willing, to accept any arrangement with .Russia that does not eventually aim at repayment of these debts.