IV

THE TREATY

61

only vessels flying the German flag, but also allvessels owned by Germans but flying other flags, andall vessels under construction as well as those afloat. 1Further, Germany undertakes, if required, to build forthe Allies such types of ships as they may specify upto 200,000 tons 2 annually for five years, the value ofthese ships being credited to Germany against whatis due from her for Reparation. 3

Thus the German mercantile marine is swept fromthe seas and cannot be restored for many years tocome on a scale adequate to meet the requirements ofher own commerce. For the present, no lines will runfrom Hamburg, except such as foreign nations mayfind it worth while to establish out of their surplustonnage. Germany will have to pay to foreigners forthe carriage of her trade such charges as they maybe able to exact, and will receive only such con-veniences as it may suit them to give her. Theprosperity of German ports and commerce can onlyrevive, it would seem, in proportion as she succeeds inbringing under her effective influence the merchantmarines of Scandinavia and of Holland.

(2) Germany has ceded to the Allies " all herrights and titles over her oversea possessions." 4 Thiscession not only applies to sovereignty but extends onunfavourable terms to Government property, all of

1 Part VIII. Annex III. (3).

2 In the years before the war the average shipbuilding output of Germany was about 350,000 tons annually, exclusive of warships.

3 Part VIII. Annex III. (5). 4 Art. 119.