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Anglo-German Naval Agreement

Anglo-German Naval Agreement

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The Anglo-German Naval Agreement (A.G.N.A) of June 18, 1935 was a bilateral agreement between the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...

 and German Reich
Nazi Germany
Nazi Germany , also known as the Third Reich , but officially called German Reich from 1933 to 1943 and Greater German Reich from 26 June 1943 onward, is the name commonly used to refer to the state of Germany from 1933 to 1945, when it was a totalitarian dictatorship ruled by...

 regulating the size of the Kriegsmarine
Kriegsmarine
The Kriegsmarine was the name of the German Navy during the Nazi regime . It superseded the Kaiserliche Marine of World War I and the post-war Reichsmarine. The Kriegsmarine was one of three official branches of the Wehrmacht, the unified armed forces of Nazi Germany.The Kriegsmarine grew rapidly...

in relation to the Royal Navy
Royal Navy
The Royal Navy is the naval warfare service branch of the British Armed Forces. Founded in the 16th century, it is the oldest service branch and is known as the Senior Service...

. The A.G.N.A fixed a ratio whereby the total tonnage of the Kriegsmarine was to be 35% of the total tonnage of the Royal Navy on a permanent basis. It was registered in League of Nations Treaty Series on July 12, 1935. The agreement was renounced by Adolf Hitler
Adolf Hitler
Adolf Hitler was an Austrian-born German politician and the leader of the National Socialist German Workers Party , commonly referred to as the Nazi Party). He was Chancellor of Germany from 1933 to 1945, and head of state from 1934 to 1945...

 on April 28, 1939.

The A.G.N.A was an ambitious attempt on the part of both London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...

 and Berlin
Berlin
Berlin is the capital city of Germany and is one of the 16 states of Germany. With a population of 3.45 million people, Berlin is Germany's largest city. It is the second most populous city proper and the seventh most populous urban area in the European Union...

 to reach better relations, but it ultimately floundered because of conflicting expectations between the two states. For the Germans, the A.G.N.A. was intended to mark the beginning of an Anglo-German alliance against France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...

 and the Soviet Union
Soviet Union
The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....

, whereas for the British, the A.G.N.A. was to be the beginning of a series of arms limitation agreements that were made to limit German expansionism. The A.G.N.A was highly controversial, both at the time and since, because the 35:100 tonnage ratio allowed Germany the right to build a Navy beyond the limits set by the Treaty of Versailles
Treaty of Versailles
The Treaty of Versailles was one of the peace treaties at the end of World War I. It ended the state of war between Germany and the Allied Powers. It was signed on 28 June 1919, exactly five years after the assassination of Archduke Franz Ferdinand. The other Central Powers on the German side of...

, and the British had made the agreement without consulting France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...

 or Italy
Italy
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...

 first.

Background


Part IV of the 1919 Treaty of Versailles had imposed severe restrictions on the size and capacities on the armed forces of the Reich. In regards to the Navy, Germany was allowed no submarines, no naval aviation, and no battleships; the total naval forces allowed to the Germans were six heavy cruiser
Heavy cruiser
The heavy cruiser was a type of cruiser, a naval warship designed for long range, high speed and an armament of naval guns roughly 203mm calibre . The heavy cruiser can be seen as a lineage of ship design from 1915 until 1945, although the term 'heavy cruiser' only came into formal use in 1930...

s of no more than 10,000 tons displacement, six light cruiser
Light cruiser
A light cruiser is a type of small- or medium-sized warship. The term is a shortening of the phrase "light armored cruiser", describing a small ship that carried armor in the same way as an armored cruiser: a protective belt and deck...

s of no more than 6,000 tons displacement, 12 destroyer
Destroyer
In naval terminology, a destroyer is a fast and maneuverable yet long-endurance warship intended to escort larger vessels in a fleet, convoy or battle group and defend them against smaller, powerful, short-range attackers. Destroyers, originally called torpedo-boat destroyers in 1892, evolved from...

s of no more than 800 tonnes displacement and 12 torpedo boat
Torpedo boat
A torpedo boat is a relatively small and fast naval vessel designed to carry torpedoes into battle. The first designs rammed enemy ships with explosive spar torpedoes, and later designs launched self-propelled Whitehead torpedoes. They were created to counter battleships and other large, slow and...

s. Through the interwar years, German opinion had protested these restrictions as harsh and unjust, and demanded that either all of the other states of Europe disarm down to German levels, or alternatively, Germany be allowed to rearm to the level of all the other European states. In Britain, where after 1919 there was much guilt over the alleged excessively harsh terms of Versailles, the German claim to "equality" in armaments often met with considerable sympathy. More importantly, every German government of the Weimar Republic
Weimar Republic
The Weimar Republic is the name given by historians to the parliamentary republic established in 1919 in Germany to replace the imperial form of government...

 was implacably opposed to the terms of Versailles, and given that Germany was potentially Europe’s strongest power, from the British perspective it made sense to revise Versailles in Germany’s favor as the best way of preserving the peace. The British attitude was well summarized in a Foreign Office memo from 1935 that stated "...from the earliest years following the war it was our policy to eliminate those parts of the Peace Settlement which, as practical people, we knew to be unstable and indefensible". The change of regime in Germany in 1933 did cause alarm in London, but there was considerable uncertainty about what Hitler’s long term intentions were. In August 1933, the chief of the Committee of Imperial Defense (CID), Royal Marine General Sir Maurice Hankey, visited Germany, and wrote down his impressions of the “New Germany” in October 1933. Hankley’s report concluded with the words: “Are we still dealing with the Hitler of Mein Kampf
Mein Kampf
Mein Kampf is a book written by Nazi leader Adolf Hitler. It combines elements of autobiography with an exposition of Hitler's political ideology. Volume 1 of Mein Kampf was published in 1925 and Volume 2 in 1926...

, lulling his opponents to sleep with fair words to gain time to arm his people, and looking always to the day when he can throw off the mask and attack Poland? Or is it a new Hitler, who discovered the burden of responsible office, and wants to extricate himself, like many an earlier tyrant from the commitments of his irresponsible days? That is the riddle that has to be solved”. This uncertainty over what Hitler's ultimate intentions in foreign policy were was to colour much of British policy towards Germany until 1939.

Equally important as one of the origins of the Treaty were the deep cuts made to the Royal Navy after the Washington Naval Conference
Washington Naval Conference
The Washington Naval Conference also called the Washington Arms Conference, was a military conference called by President Warren G. Harding and held in Washington from 12 November 1921 to 6 February 1922. Conducted outside the auspices of the League of Nations, it was attended by nine nations...

 of 1921-22 and the London Naval Conference
London Naval Conference
There were three major international naval conferences in London, the first in 1908-09, the second in 1930 and the third in 1935. The latter two, together with the Washington Naval Conference in 1921-22 and the Geneva Conferences , resulted in agreements between the major powers on navy vessel...

 of 1930. The cuts imposed by the two conferences, combined with the effects of the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...

, caused the collapse of much of the British shipbuilding industry in the early 1930s. This would seriously hinder efforts at British naval rearmament later in the decade, and would lead the Admiralty
Admiralty
The Admiralty was formerly the authority in the Kingdom of England, and later in the United Kingdom, responsible for the command of the Royal Navy...

 to greatly value treaties which imposed quantitative and qualitative limitations on potential enemies as the best way of ensuring British sea supremacy. The British Empire faced worldwide defense commitments, but lacked both the industrial infrastructure and financial resources to build up a navy capable of being simultaneously strong in both Far East
Far East
The Far East is an English term mostly describing East Asia and Southeast Asia, with South Asia sometimes also included for economic and cultural reasons.The term came into use in European geopolitical discourse in the 19th century,...

ern and European waters. It was therefore important that potential enemies place voluntary limitations on the size and scale of their navies. In particular, Admiral Sir Ernle Chatfield, the First Sea Lord
First Sea Lord
The First Sea Lord is the professional head of the Royal Navy and the whole Naval Service; it was formerly known as First Naval Lord. He also holds the title of Chief of Naval Staff, and is known by the abbreviations 1SL/CNS...

 between 1933–1938, came to argue in favor of such treaties. They promised a highly standardized classification of different warships, and discouraged technical innovations that, under the existing conditions, the Royal Navy could not always hope to match. Admiral Chatfield especially wished for the Germans to do away with their Deutschland-class
Deutschland class cruiser
The Deutschland class was a series of three panzerschiffe , a form of heavily armed cruiser, built by the Reichsmarine officially in accordance with restrictions imposed by the Treaty of Versailles...

 Panzerschiffe (known in the press as "pocket battleships" to the British), as such ships, embracing the characteristics of both battleships and cruisers, were highly dangerous to Chatfield’s vision of a world of highly regulated warship types and designs. As part of the effort to do away with the Panzerschiffe, the British Admiralty stated in March 1932 and again in the spring of 1933, that Germany was entitled to "a moral right to some relaxation of the treaty [of Versailles]".

In February 1932, the World Disarmament Conference
World Disarmament Conference
The Conference for the Reduction and Limitation of Armaments of 1932-34 was an effort by member states of the League of Nations, together with the U.S. and the Soviet Union, to actualize the ideology of disarmament...

 opened in Geneva
Geneva
Geneva In the national languages of Switzerland the city is known as Genf , Ginevra and Genevra is the second-most-populous city in Switzerland and is the most populous city of Romandie, the French-speaking part of Switzerland...

, Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....

. Among the more hotly debated issues at the conference was the German demand for gleichberechtigung (“equality of armaments”) (i.e. abolishing Part V of Versailles) versus the French demand for sécurité (“security”) in armaments (i.e. maintaining Part V as the best way of ensuring French security). The British position was an attempt to play the “honest broker”, and sought to seek a compromise between the French claim to sécurité and the German claim to gleichberechtigung, which in practice meant backing the German claim to rearm beyond Part V, but not allowing the Germans to rearm enough to threaten France. Various British compromise proposals along these lines were rejected by both the French and German delegations as unacceptable. In September 1932, Germany walked out of the conference, claiming it was impossible to achieve gleichberechtigung. By this time, the electoral success of the National Socialist German Workers Party
National Socialist German Workers Party
The National Socialist German Workers' Party , commonly known in English as the Nazi Party, was a political party in Germany between 1920 and 1945. Its predecessor, the German Workers' Party , existed from 1919 to 1920...

 had alarmed London, and it was felt unless the Weimar Republic
Weimar Republic
The Weimar Republic is the name given by historians to the parliamentary republic established in 1919 in Germany to replace the imperial form of government...

 could achieve some dramatic foreign policy success, Adolf Hitler
Adolf Hitler
Adolf Hitler was an Austrian-born German politician and the leader of the National Socialist German Workers Party , commonly referred to as the Nazi Party). He was Chancellor of Germany from 1933 to 1945, and head of state from 1934 to 1945...

 might come to power. In order to lure the Germans back to Geneva, after several months of strong British diplomatic pressure on the French, in December 1932, all of the other delegations voted for a British-sponsored resolution that would allow for the "theoretical equality of rights in a system which would provide security for all nations". Germany agreed to return to the conference. Thus, before Hitler became Chancellor, it had been accepted that Germany could rearm beyond the limits set by Versailles, through the precise extent of German rearmament was still open to negotiation.

During the 1920s, Hitler’s thinking on foreign policy went through a dramatic change. At the beginning of his political career, Hitler was hostile to Britain as one enemies of the Reich, but strongly influenced by the British opposition to the French occupation of the Ruhr
Ruhr
The Ruhr is a medium-size river in western Germany , a right tributary of the Rhine.-Description:The source of the Ruhr is near the town of Winterberg in the mountainous Sauerland region, at an elevation of approximately 2,200 feet...

 in 1923, Hitler came to rank Britain as a potential ally. In Mein Kampf
Mein Kampf
Mein Kampf is a book written by Nazi leader Adolf Hitler. It combines elements of autobiography with an exposition of Hitler's political ideology. Volume 1 of Mein Kampf was published in 1925 and Volume 2 in 1926...

, and even more in its sequel, Zweites Buch
Zweites Buch
The Zweites Buch is an unedited transcript of Adolf Hitler's thoughts on foreign policy written in 1928; it was written after Mein Kampf and was never published in his lifetime.-Composition:...

, Hitler strongly criticized the pre-1914 German government for embarking on a naval and colonial challenge to the British Empire
British Empire
The British Empire comprised the dominions, colonies, protectorates, mandates and other territories ruled or administered by the United Kingdom. It originated with the overseas colonies and trading posts established by England in the late 16th and early 17th centuries. At its height, it was the...

, and in Hitler’s view, needlessly antagonizing the British. In Hitler’s view, Britain was a fellow “Aryan
Aryan
Aryan is an English language loanword derived from Sanskrit ārya and denoting variously*In scholarly usage:**Indo-Iranian languages *in dated usage:**the Indo-European languages more generally and their speakers...

” power, whose friendship could be won by a German "renunciation" of naval and colonial ambitions against Britain. In return for such a “renunciation”, Hitler expected an Anglo-German alliance directed at France and the Soviet Union, and British support for the German efforts to acquire Lebensraum
Lebensraum
was one of the major political ideas of Adolf Hitler, and an important component of Nazi ideology. It served as the motivation for the expansionist policies of Nazi Germany, aiming to provide extra space for the growth of the German population, for a Greater Germany...

in Eastern Europe. As the first step towards the Anglo-German alliance, Hitler had written in Mein Kampf of his intention to seek a “sea pact”, by which Germany would “renounce” any naval challenge against Britain.

In January 1933, Hitler became the German chancellor. The new government in Germany had inherited a strong negotiating position at Geneva from the previous government of General Kurt von Schleicher
Kurt von Schleicher
Kurt von Schleicher was a German general and the last Chancellor of Germany during the era of the Weimar Republic. Seventeen months after his resignation, he was assassinated by order of his successor, Adolf Hitler, in the Night of the Long Knives....

. The German strategy was to make idealistic offers of limited rearmament, out of the expectation that all such offers would be rejected by the French, allowing Germany to go on ultimately with the maximum rearmament. The ultra-nationalism
Nationalism
Nationalism is a political ideology that involves a strong identification of a group of individuals with a political entity defined in national terms, i.e. a nation. In the 'modernist' image of the nation, it is nationalism that creates national identity. There are various definitions for what...

 of the Nazi regime had alarmed the French, who put the most minimal possible interpretation of German "theoretical equality” in armaments, and thereby played into the German strategy. In October 1933, the Germans again walked out of the conference, stating that everyone else should either disarm to the Versailles level, or allow Germany to rearm beyond Versailles. Through the Germans never had any serious interest in accepting any of the various British compromise proposals, in London, the German walk-out was widely, if erroneously blamed on French “intransigence”. The British government was left with the conviction that in the future, that opportunities for arms limitation talks with the Germans should not be lost because of French “intransigence”. Subsequent British offers to arrange for the German return to the World Disarmament Conference were sabotaged by the Germans putting forward proposals that were meant to appeal to the British, while being unacceptable to the French. On April 17, 1934, the last such effort ended with the French Foreign Minister Louis Barthou
Louis Barthou
Jean Louis Barthou was a French politician of the Third Republic.-Early years:He was born in Oloron-Sainte-Marie, Pyrénées-Atlantiques, and served as Deputy from that constituency. He was an authority on trade union history and law. Barthou was Prime Minister in 1913, and held ministerial office...

's rejection of the latest German offer as unacceptable in the so-called "Barthou note" which ended French participation in the Conference while declaring that France would look after its own security in whatever way was necessary. At the same time, Admiral Erich Raeder
Erich Raeder
Erich Johann Albert Raeder was a naval leader in Germany before and during World War II. Raeder attained the highest possible naval rank—that of Großadmiral — in 1939, becoming the first person to hold that rank since Alfred von Tirpitz...

 of the Reichsmarine persuaded Hitler of the advantages of ordering two more Panzerschiffe, and in 1933 advised the Chancellor that Germany would be best off by 1948 a with a fleet of three aircraft carrier
Aircraft carrier
An aircraft carrier is a warship designed with a primary mission of deploying and recovering aircraft, acting as a seagoing airbase. Aircraft carriers thus allow a naval force to project air power worldwide without having to depend on local bases for staging aircraft operations...

s, 18 cruisers, eight Panzerschiffe, 48 destroyers and 74 U-boats. Admiral Raeder argued to Hitler that Germany needed naval parity with France as a minimum goal, whereas Hitler from April 1933 onwards, expressed a desire for a Reichsmarine of 33.3% of the total tonnage of the Royal Navy. In November 1934, the Germans formally informed the British of their wish to reach a treaty with Britain, under which the Reichsmarine would be allowed to grow until the size of 35% of the Royal Navy (the figure was raised because the phrase of a German goal of “one third of the Royal Navy except in cruisers, destroyers, and submarines” did not sound well in speeches). Admiral Raeder felt that the 35:100 ratio was unacceptable towards Germany, but was overruled by Hitler who insisted on the 35:100 ratio. Aware of the German desire to expand their Navy beyond Versailles, Admiral Chatfield repeatedly advised it would best to reach a naval treaty with Germany, so to regulate the future size and scale of the German Navy. Through the Admiralty described the idea of a 35:100 tonnage ratio between London and Berlin as “the highest that we could accept for any European power”, it advised the government that the earliest Germany could build a Navy to that size was 1942, and that though they would prefer a smaller tonnage ratio than 35:100, a 35:100 ratio was nonetheless acceptable. In December 1934, a study done by Captain Edward King, Director of the Royal Navy's Plans Division suggested that the most dangerous form a future German Navy might take from the British perspective would be a Kreuzerkrieg (Cruiser war) fleet. Captain King argued that guerre-de-course German fleet of Panzerschiffe, cruisers, and U-boats operating in task forces would be highly dangerous for the Royal Navy, and that a German "balanced fleet" that would be a mirror image of the Royal Navy would be the least dangerous form the German Navy could take. A German "balanced fleet" would have proportionally the same number of battleships, cruisers, destroyers, etc. that the British fleet possessed, and from the British point of view, this would be in the event of war, the easiest German fleet to defeat.

Through every government of the Weimar Republic had violated Part V of Versailles, in 1933 and 1934, the Nazi government had become more flagrant and open in violating Part V. In 1933, the Germans started to build their first U-boats since World War I, and in April 1935, launched their first U-boats. On April 25, 1935, the British Naval attaché to Germany, Captain Gerard Muirhead-Gould
Gerard Muirhead-Gould
Rear Admiral Gerard Charles Muirhead-Gould DSC was an officer of the Royal Navy.Muirhead-Gould was born in London. He was the son of Arthur Lewis Gould and Emily Gertrude Lilias Muirhead. He joined the Royal Naval Cadets in January 1904...

 was officially informed by Captain Leopold Bürkner of the Reichsmarine that Germany had laid down twelve 250 ton U-boats at Kiel
Kiel
Kiel is the capital and most populous city in the northern German state of Schleswig-Holstein, with a population of 238,049 .Kiel is approximately north of Hamburg. Due to its geographic location in the north of Germany, the southeast of the Jutland peninsula, and the southwestern shore of the...

. On April 29, 1935, the Foreign Secretary Sir John Simon
John Simon, 1st Viscount Simon
John Allsebrook Simon, 1st Viscount Simon GCSI GCVO OBE PC was a British politician who held senior Cabinet posts from the beginning of the First World War to the end of the Second. He is one of only three people to have served as Home Secretary, Foreign Secretary and Chancellor of the Exchequer,...

 informed the British House of Commons
British House of Commons
The House of Commons is the lower house of the Parliament of the United Kingdom, which also comprises the Sovereign and the House of Lords . Both Commons and Lords meet in the Palace of Westminster. The Commons is a democratically elected body, consisting of 650 members , who are known as Members...

 that Germany was now building U-boats. On May 2, 1935, the Prime Minister Ramsay MacDonald
Ramsay MacDonald
James Ramsay MacDonald, PC, FRS was a British politician who was the first ever Labour Prime Minister, leading a minority government for two terms....

 told the House of his government’s intention to reach a naval pact to regulate the future growth of the German Navy.

In a more general sense, because of the British championship of German "theoretical equality” at the World Disarmament Conference, London was in a weak moral position to oppose the German violations. The German response to British complaints about violations of Part V were that they were merely unilaterally exercising rights the British delegation at Geneva were prepared to concede to the Reich. In March 1934, a British Foreign Office memo stated "Part V of the Treaty of Versailles...is, for practical purposes, dead, and it would become a putrefying corpse which, if left unburied, would soon poison the political atmosphere of Europe. Moreover, if there is to be a funeral, it is clearly better to arrange it while Hitler is still in a mood to pay the undertakers for their services". In December 1934, a secret Cabinet committee met to discuss the situation caused by German rearmament. The British Foreign Secretary Sir John Simon
John Simon, 1st Viscount Simon
John Allsebrook Simon, 1st Viscount Simon GCSI GCVO OBE PC was a British politician who held senior Cabinet posts from the beginning of the First World War to the end of the Second. He is one of only three people to have served as Home Secretary, Foreign Secretary and Chancellor of the Exchequer,...

 stated at one of the committee’s meeting that "If the alternative to legalizing German rearmament was to prevent it, there would be everything to be said, for not legalizing it". But since London had already rejected the idea of a war to end German rearmament, the British government chose a diplomatic strategy that would exchange abolition of Part V in exchange for German return to both the League of Nations, and the World Disarmament Conference". At the same meeting, Simon stated "Germany would prefer, it appears, to be `made an honest woman'; but if she is left too long to indulge in illegitimate practices and to find by experience that she does not suffer for it, this laudable ambition may wear off". In January 1935, Simon wrote to King George V
George V of the United Kingdom
George V was King of the United Kingdom and the British Dominions, and Emperor of India, from 6 May 1910 through the First World War until his death in 1936....

 that “The practical choice is between a Germany which continues to rearm without any regulation or agreement and a Germany which, through getting a recognition of its rights and some modifications of the Peace Treaties enters into the comity of nations and contributes in this or other ways to European stability. As between these two courses, there can be no doubt which is the wiser". In February 1935, at a summit in London between the French Premier Pierre Laval
Pierre Laval
Pierre Laval was a French politician. He was four times President of the council of ministers of the Third Republic, twice consecutively. Following France's Armistice with Germany in 1940, he served twice in the Vichy Regime as head of government, signing orders permitting the deportation of...

 and the British Prime Minister Ramsay MacDonald
Ramsay MacDonald
James Ramsay MacDonald, PC, FRS was a British politician who was the first ever Labour Prime Minister, leading a minority government for two terms....

 led to an Anglo-French communiqué issued in London that proposed talks with the Germans on arms limitation, an air part, and security pacts for Eastern Europe and the nations along the Danube.

In early March 1935, talks intended to discuss the scale and extent of German rearmament in Berlin between Hitler and Simon were postponed when Hitler took offense at a British government White Paper
White paper
A white paper is an authoritative report or guide that helps solve a problem. White papers are used to educate readers and help people make decisions, and are often requested and used in politics, policy, business, and technical fields. In commercial use, the term has also come to refer to...

 justifying a higher defense budget under the grounds that Germany was violating Versailles, and claimed to have contracted a “cold”. In the interval between Hitler “recovering” from his “diplomatic cold” and Simon's visit, the German government took the chance to formally reject all of the clauses of Versailles relating to disarmament on the land and air. In the 1930s, the British government was obsessed with the idea of a German bombing attack destroying London, and so placed a great deal of a value reaching an air pact outlawing bombing. The idea of a naval agreement was felt to be a useful stepping stone to an air pact. On March 26, 1935, during one of his meetings with Simon, and his deputy Sir Anthony Eden
Anthony Eden
Robert Anthony Eden, 1st Earl of Avon, KG, MC, PC was a British Conservative politician, who was Prime Minister from 1955 to 1957...

, Hitler stated his intention to formally reject the naval disarmament section of Versailles, but was prepared to discuss a treaty regulating the scale of German naval rearmament. On May 21, 1935, Hitler in a speech in Berlin formally offered to discuss a treaty offering a German Navy that was to operate forever on a 35:100 naval ratio. During his "peace speech" of May 21, Hitler disallowed any intention of engaging in a pre-1914 style naval race with Britain, and stated: "The German Reich government recognizes of itself the overwhelming importance for existence and thereby the justification of dominance at sea to protect the British Empire, just as, on the other hand, we are determined to do everything necessary in protection of our own continental existence and freedom". For Hitler, his speech illustrated the quid pro quo of an Anglo-German alliance, namely British acceptance of German mastery of continental Europe in exchange for German acceptance of British mastery over the seas.

Negotiation


On May 22, 1935, the British Cabinet voted to take up formally Hitler's offers of May 21 as soon as possible. Sir Eric Phipps
Eric Phipps
Sir Eric Clare Edmund Phipps, GCB, GCMG, GCVO, PC was a British diplomat.-Family and early life:Phipps was the son of Sir Constantine Phipps, later British Ambassador to Belgium, and his wife Maria Jane...

, the British Ambassador in Berlin, advised London that no chance at a naval agreement with Germany should be lost “owing to French shortsightedness”. Admiral Chatfield informed the Cabinet that it most unwise to “oppose [Hitler’s] offer, but what the reactions of the French will be to it are more uncertain and its reaction on our own battleship replacement still more so”. On March 27, 1935, Hitler had appointed Joachim von Ribbentrop
Joachim von Ribbentrop
Ulrich Friedrich Wilhelm Joachim von Ribbentrop was Foreign Minister of Germany from 1938 until 1945. He was later hanged for war crimes after the Nuremberg Trials.-Early life:...

, who served as both Hitler’s Extraordinary Ambassador-Plenipotentiary at Large (making part of the Auswärtiges Amt, the German Foreign Office) and as the chief of a Nazi Party organization named the Dienststelle Ribbentrop that competed with the Auswärtiges Amt was appointed to head the German delegation to negotiate any naval treaty. Baron Konstantin von Neurath
Konstantin von Neurath
Konstantin Freiherr von Neurath was a German diplomat remembered mostly for having served as Foreign minister of Germany between 1932 and 1938...

, the German Foreign Minister was first opposed to this arrangement, but changed his mind when he decided that the British would never accept the 35:100 ratio, and having Ribbentrop head the mission was the best way to discredit his rival.

On June 2, 1935, Ribbentrop arrived in London. The talks began on Tuesday, June 4, 1935 at the Admiralty office with Ribbentrop heading the German delegation and Simon the British delegation. Ribbentrop, who was determined to succeed at his mission, no matter what, began his talks by stating the British could either accept the 35:100 ratio as "fixed and unalterable" by the weekend, or else the German delegation would go home, and the Germans would build their navy up to any size they wished. Simon was visibly angry with Ribbentrop’s behavior, stated that “It is not usual to make such conditions at the beginning of negotiations” , and walked out of the talks. On Wednesday, June 5, 1935, a change of opinion came over the British delegation. In a report to the British Cabinet, that they “definitely of the opinion that, in our own interest, we should accept this offer of Herr Hitler’s while it is still open...If we now refuse to accept the offer for the purposes of these discussions, Herr Hitler will withdraw the offer and Germany will seek to build to a higher level than 35 per cent...Having regard to past history and to Germany’s known capacity to become a serious naval rival of this country, we may have cause to regret it if we fail to take this chance...”. Also on June 5, during talks between Sir Robert Craigie
Robert Craigie (diplomat)
Sir Robert Craigie GCMG, CB was the British ambassador in Japan from 1937 through 1941.-Career as Ambassador:In July 1939 took part in negotiations with Japanese Minister of Foreign Affairs Hachiro Arita, leading to the acceptance of the Craigie-Arita formula, by which the British government...

, the British Foreign Office’s naval expert and chief of the Foreign Office's American Department and Ribbentrop’s deputy, Admiral Karl-Georg Schuster, the Germans conceded that the 35:100 ratio would take the form of tonnage ratios, during the Germans would more or less build their tonnage up to whatever the British tonnage was in various warship categories. On the afternoon of that same day, the British Cabinet voted to accept the 35:100 ratio, and Ribbentrop was informed of the Cabinet’s acceptance in the evening. During the next two weeks, talks continued in London on various technical issues, mostly relating to how the tonnage ratios would be calculated in the various warship categories. Ribbentrop was desperate for success, and agreed to almost all of the British demands. On June 18, 1935, the A.G.N.A was signed in London by Ribbentrop, and the new British Foreign Secretary, Sir Samuel Hoare. Hitler called June 18, 1935 the day of the signing of the A.G.N.A. “the happiest day of his life” as he believed that the A.G.N.A marked the beginning of an Anglo-German alliance.

The Agreement


The terms of the Anglo-German Naval Agreement as signed in London on June 18, 1935 read as follows:

"Exchange of Notes between His Majesty's Government in the United Kingdom and the German Government regarding the Limitation of Naval Armaments-London, June 18, 1935.

(1)

Sir Samuel Hoare to Herr von Ribbentrop
Your Excellency, Foreign Office, June 18, 1935

During the last few days the representatives of the German Government and His Majesty's Government in the United Kingdom have been engaged in conversations, the primary purpose of which has been to prepare the way for the holding of a general conference on the subject of the limitation of naval armaments. I have now much pleasure in notifying your Excellency of the formal acceptance by His Majesty's Government in the United Kingdom of the proposal of the German Government discussed at those conversations that the future strength of the German navy in relation to the aggregate naval strength of the Members of the British Commonwealth of Nations should be in the proportion of 35:100. His Majesty's Government in the United Kingdom regard this proposal as a contribution of the greatest importance to the cause of future naval limitation. They further believe that the agreement which they have now reached with the German government, and which they regard as a permanent and definite agreement as from to-day between the two Governments, will facilitate the conclusion of a general agreement on the subject of naval limitation between all the naval Powers of the world.

2. His Majesty's Government in the United Kingdom also agree with the explanations which were furnished by the German representatives in the course of the recent discussions in London as the method of application of this principle. These explanations may be summarised as follows:-

(a) The ratio of 35:100 is to be a permanent relationship, i.e. the total tonnage of the German fleet shall never exceed a percentage of 35 of the aggregate tonnage of the naval forces, as defined by treaty, of the Members of the British Commonwealth of Nations, or, if there should in future, be no treaty limitations of the Members of the British Commonwealth of Nations.

(b) If any future general treaty of naval limitation should not adopt the method of limitation by agreed ratios between the fleets of different Powers, the German Government will not insist on the incorporation of the ratio mentioned in the preceding sub-paragraph in such future general treaty, provided that the method therein adopted for the future limitation of naval armaments is such as to give Germany full guarantees that this ratio can be maintained.

(c) Germany will adhere to the ratio 35:100 in all circumstances, e.g. the ratio will not be affected by the construction of other Powers. If the general equilibrium of naval armaments,as normally maintained in the past, should be violently upset by any abnormal and exceptional construction by other Powers, the German Government reserve the right to invite His Majesty's Government in the United Kingdom to examine the new situation thus created.

(d)The German Government favour, the matter of limitation of naval armaments, that system which divides naval vessels into categories, fixing the maximum tonnage and/or armament for vessels in each category, and allocates the tonnage to be allowed to each Power by categories of vessels. Consequently in principle, and subject to (f) below, the German Government are prepared to apply the 35 per cent. ratio to the tonnage of each category of vessel to be maintained, and to make any variation of this ratio in a particular category or categories dependent on the arrangements to this end that may be arrived at in a future general treaty on naval limitation, such arrangements being based on the principle that any increase in one category would be compensated for by a corresponding reduction in others. If no general treaty on naval limitation should be concluded, or if the future general treaty should not contain provision creating limitation by categories, the manner and degree in which the German Government will have the right to vary the 35 percent. ratio in one or more categories will be a matter for settlement by agreement between the German Government and His Majesty's Government in the United Kingdom, in the light of the naval situation then existing.

(e) If, and for so long as other important naval Powers retain a single category for cruisers and destroyers, Germany shall enjoy the right to have a single category for these two classes of vessels, although she would prefer to see these classes in two categories.

(f) In the matter of submarines, however, Germany, while not exceeding the ratio of 35:100 in respect of total tonnage, shall have the right to possess a submarine tonnage equal to the total submarine tonnage possessed by the Members of the British Commonwealth of Nations. The German Government, however, undertake that, except in the circumstances indicated in the immediately following sentence, Germany's submarine tonnage shall not exceed 45 percent. of the total of that possessed by the Members of the British Commonwealth of Nations. The German Government reserve the right, in the event of a situation arising, which in their opinion, makes it necessary for Germany to avail herself of her right to a percentage of submarine tonnage exceeding the 45 per cent. above mentioned, to give notice this effect to His Majesty's Government in the United Kingdom, and agree that the matter shall be the subject of friendly discussion before the German Government exercise that right.

(g) Since it is highly improbable that the calculation of the 35 per cent. ratio should give for each category of vessels tonnage figures exactly divisible by the maximum individual tonnage permitted for ships in that category, it may be necessary that adjustments should be make in order that Germany shall not be debarred from utilising her tonnage to the full. It has consequently been agreed that the German Government and His Majesty's Government in the United Kingdom will settle by common accord what adjustments are necessary for this purpose, and it will be understood that this procedure shall not result in any substantial or permanent departure from the ratio 35:100 in respect of total strengths.

3. With reference to sub-paragraph (c) of the explanations set out above, I have the honour to inform you that His Majesty's Government in the United Kingdom have taken note of the reservation and recognise in the right therein set out, on the understanding that the 35:100 ratio will be maintained in default of agreement to the contrary between the two Governments.

4. I have the honour to request your Excellency to inform me that the German Government agree that the proposal of the German Government has been correctly set out in the preceding paragraphs of this note.

I have. & c.

SAMUEL HOARE

----

(2)

(Translation)

Herr von Ribbentrop to Sir Samuel Hoare

Your Excellency, London, June 18, 1935

I have the honour to acknowledge the receipt of your Excellency's note of to-day's date, in which you were so good as to communicate to me on behalf of His Majesty's Government in the United Kingdom the following:-

(Here follows a German translation of paragraphs 1 to 3 of No. 1.)

I have the honour to confirm to your Excellency that the proposal of the German Government is correctly set forth in the foregoing note, and I note with pleasure that His Majesty's Government in the United Kingdom accept this proposal.

The German Government, for their part, are also of the opinion that the agreement at which they have now arrived with His Majesty's Government in the United Kingdom, and which they regard as a permanent and definite agreement with effect from to-day between the two Governments, will facilitate the conclusion of a general agreement on this question between all the naval Powers of the world.

I have, & c.

JOACHIM VON RIBBENTROP,

Ambassador Extraordinary and Plenipotentiary of Germany".

French reaction


The Naval Pact was signed in London on June 18, 1935, without the British government consulting with France and Italy, or later, to inform them of the secret agreements which stipulated that the Germans could build in certain categories more powerful warships than any the three Western nations then possessed. The French regarded this as treachery. They saw it as a further appeasement of Hitler, whose appetite grew on concessions. And they resented the British agreeing, for what they thought a private gain, to scrap further the peace treaty and thus add to the growing overall military power of Nazi Germany. Great Britain, as the French contended, had no legal right to absolve Germany from respecting the naval clauses of the Versailles Treaty.

Impact


Because of the lengthy period of time needed to construct warships, and the short duration of the A.G.N.A., its impact was limited. It was estimated by both German and British naval experts that the earliest year Germany could reach the 35% limit was 1942. In practice, lack of shipbuilding space, design problems, shortages of skilled workers, the scarcity of foreign exchange to purchase necessary raw materials that Germany lacked, and the lack of steel and non-ferrous metals caused by the Kriegsmarine being third in terms of German rearmament priorities behind the Wehrmacht
Wehrmacht
The Wehrmacht – from , to defend and , the might/power) were the unified armed forces of Nazi Germany from 1935 to 1945. It consisted of the Heer , the Kriegsmarine and the Luftwaffe .-Origin and use of the term:...

 and the Luftwaffe
Luftwaffe
Luftwaffe is a generic German term for an air force. It is also the official name for two of the four historic German air forces, the Wehrmacht air arm founded in 1935 and disbanded in 1946; and the current Bundeswehr air arm founded in 1956....

 led to the Kriegsmarine
Kriegsmarine
The Kriegsmarine was the name of the German Navy during the Nazi regime . It superseded the Kaiserliche Marine of World War I and the post-war Reichsmarine. The Kriegsmarine was one of three official branches of the Wehrmacht, the unified armed forces of Nazi Germany.The Kriegsmarine grew rapidly...

(as the German Navy had been renamed in 1935) being nowhere close to the 35% limit by the time that Hitler denounced the A.G.N.A. in 1939.

However, the requirement that the Kriegsmarine divide its 35% tonnage ratio by warship categories had the effect of forcing the Germans to build a symmetrical "balanced fleet" building program that reflected British priorities. Since in the viewpoint of the Royal Navy's leadership, a German "balanced fleet" would be the easiest German fleet for the Royal Navy to defeat and a German guerre-de-course fleet the most dangerous, in the British viewpoint, the A.G.N.A. brought considerable strategical benefits. Above all, since the Royal Navy did not build "pocket battleships", Admiral Chatfield valued the end of the Panzerschiff building caused by the A.G.N.A. When the Kriegsmarine began planning for a war with Britain in May 1938, the Kriegsmarine's senior operations officer, Commander Hellmuth Heye concluded the best strategy the Kriegsmarine could follow was a Kreuzerkrieg fleet of U-boats, light cruisers and Panzerschiff operating in tandem. Commander Heye was critical of the existing building priorities dictated by the A.G.N.A. under the grounds that there was no realistic possibility of a German "balanced fleet" defeating the Royal Navy. In response, senior German naval officers started to advocate a switch to a Kreuzerkrieg type fleet that would pursue a guerre-de-course strategy of attacking the British Merchant Marine, but were overruled by Hitler who insisted for reasons of prestige that Germany should build a "balanced fleet" that would attempt a Mahanian strategy of attempting to win maritime supremacy through a decisive battle with the Royal Navy in the North Sea
North Sea
In the southwest, beyond the Straits of Dover, the North Sea becomes the English Channel connecting to the Atlantic Ocean. In the east, it connects to the Baltic Sea via the Skagerrak and Kattegat, narrow straits that separate Denmark from Norway and Sweden respectively...

. Historians such as Joseph Maiolo, Geoffrey Till and the authors of the Kriegsmarine Official History have agreed with Chatfield's contention that a Kreuzerkrieg fleet offered Germany the best chance for damaging British power, and that Britain did benefit strategically from the A.G.N.A. by ensuring such a fleet was not built in the 1930s.

In the field of Anglo-German relations, the A.G.N.A. excised considerable importance. The British expressed hope as Craigie informed Ribbentrop that the A.G.N.A "was designed to facilitate further agreements within a wider framework and there was no further thought behind it". In addition, the British viewed the A.G.N.A. as a "yardstick" for measuring German intentions towards Britain. Hitler regarded the A.G.N.A as marking the beginning of an Anglo-German alliance and was much annoyed when the A.G.N.A was not followed up by what he regarded as the intended result. By 1937, Hitler started to increase both the sums of Reichmarks and raw materials to the Kriegsmarine, reflecting the increasing conviction that if war came, then Britain would be an enemy, not an ally of Germany. In December 1937, Hitler ordered the Kriegsmarine to start laying down six 16-inch gun battleships. At his meeting with Lord Halifax
E. F. L. Wood, 1st Earl of Halifax
Edward Frederick Lindley Wood, 1st Earl of Halifax, , known as The Lord Irwin from 1925 until 1934 and as The Viscount Halifax from 1934 until 1944, was one of the most senior British Conservative politicians of the 1930s, during which he held several senior ministerial posts, most notably as...

 in November 1937, Hitler stated that the A.G.N.A. was the only item in the field of Anglo-German relations that had not been "wrecked". By 1938, the only use the Germans had for the A.G.N.A. was to threaten to renounce the treaty as a way of pressuring London to accept continental Europe as Germany's rightful sphere of influence. At a meeting on April 16, 1938 between Sir Nevile Henderson
Nevile Henderson
Sir Nevile Meyrick Henderson, KCMG , was the third child of Robert and Emma Henderson and was born at Sedgwick Park near Horsham, West Sussex. Ambassador of Great Britain to Germany from 1937 to 1939, he believed that Adolf Hitler could be controlled and pushed toward peace and cooperation with...

, the British Ambassador to Germany and Hermann Göring
Hermann Göring
Hermann Wilhelm Göring, was a German politician, military leader, and a leading member of the Nazi Party. He was a veteran of World War I as an ace fighter pilot, and a recipient of the coveted Pour le Mérite, also known as "The Blue Max"...

, the latter stated it [the A.G.N.A.]had never been valued in England, and he himself bitterly regretted that Herr Hitler had ever consented to it at the time without getting anything in exchange. It had been a mistake, but Germany was nevertheless not going to remain in a state of inferiority in this respect vis-à-vis a hostile Britain, and would build up to a 100 per cent. basis". In response to Göring's statement, a joint Admiralty-Foreign Office note was sent to Henderson informing him that he should inform the Germans that:
"Field Marshal Göring's threat that in certain circumstances Germany might, presumably after denouncing the Anglo-German Naval Agreement of 1935, proceed to build up to 100% of the British fleet is clearly bluff [emphasis in the original]. In view of the great existing disparities in the size of the two navies this threat could only be executed if British construction were to remain stationary over a considerable period of years whilst German tonnage was built up to it. This would not occur. Although Germany is doubtless capable of realizing the 35% figure by 1942 if she so desires, or even appreciably earlier, it seems unlikely (considering her difficulties in connection with raw material, foreign exchange and the necessity of giving priority to her vast rearmament on land and in the air, and considering our own big programme) that she would appreciably exceed that figure during the course of the next few years. This is not to say we have not every interest in avoiding a denunciation of the Anglo-German Agreement of 1935, which would create a present state of uncertainty as to Germany's intentions and the ultimate threat of an attempt at parity with our Navy, which must be regarded as potentially dangerous given that Germany has been credited with a capacity for naval construction little inferior to our own. Indeed, so important is the Naval Agreement to His Majesty's Government that it is difficult to conceive that any general understanding between Great Britain and Germany, such as General Göring is believed to desire, would any longer be possible were the German Government to denounce the Naval Agreement. In fact, a reaffirmation of the latter in all probability have to figure as part of such a general understanding.
From the political aspect, the German Navy has we think been to Germany mainly an instrument for putting political pressure on this country. Before the war, Germany would have been willing to cease, or greatly moderate, her naval competition with this country, but only in return for a promise of our neutrality in any European conflict. Hitler has attempted the same thing by different methods, but he has seen one side of the picture as all German politicians have only seen one side of the picture. It is clear from his writings that he was enormously impressed with the part played by the pre-war naval rivalry in creating bad relations between the two countries. From this he argued that the removal of this rivalry all that was necessary to obtain good relations. By making us a free gift of an absence of naval competition he hoped that relations between the two countries would be so improved that we should not, in fact, find it necessary to interfere with Germany's continental policy. He overlooked, as all German politicians have overlooked for many years past, that this country is bound to react, not only against danger from any purely naval rival, but also against dominance of Europe by any aggressive military power, particularly if in a position to threaten the Low Countries and the Channel ports. British complaisance can never be purchased by trading one of these factors against the other and any country that attempts it is bound to create for itself disappointment and disillusion as Germany is doing".


At the conference in Munich
Munich
Munich The city's motto is "" . Before 2006, it was "Weltstadt mit Herz" . Its native name, , is derived from the Old High German Munichen, meaning "by the monks' place". The city's name derives from the monks of the Benedictine order who founded the city; hence the monk depicted on the city's coat...

 that led to the Munich Agreement
Munich Agreement
The Munich Pact was an agreement permitting the Nazi German annexation of Czechoslovakia's Sudetenland. The Sudetenland were areas along Czech borders, mainly inhabited by ethnic Germans. The agreement was negotiated at a conference held in Munich, Germany, among the major powers of Europe without...

 in September 1938, Hitler informed Neville Chamberlain
Neville Chamberlain
Arthur Neville Chamberlain FRS was a British Conservative politician who served as Prime Minister of the United Kingdom from May 1937 to May 1940. Chamberlain is best known for his appeasement foreign policy, and in particular for his signing of the Munich Agreement in 1938, conceding the...

 that if British policy was "to make it clear in certain circumstances" that Britain might be intervening in a European war, then the political preconditions for the A.G.N.A no longer existed, and Germany should denounce the A.G.N.A., thus leading to Chamberlain including mention of the A.G.N.A in the Anglo-German Declaration of September 30, 1938.

By the late 1930s, Hitler's disillusionment with Britain led to German foreign policy taking increasing anti-British course. An important sign of Hitler's changed perceptions about Britain was his decision in January 1939 to give first priority to the Kriegsmarine in relates in the allocation of money, skilled workers, and raw materials and to launch the Plan Z
Plan Z
Plan Z was the name given to the planned re-equipment and expansion of the Nazi German Navy ordered by Adolf Hitler on January 27, 1939...

 to build a colossal Kriegsmarine of 10 battleships, 16 "pocket battleships", 8 aircraft carriers, 5 heavy cruisers, 36 light cruisers, and 249 U-boats by 1944 to crush the Royal Navy. Since the fleet envisioned in the Z Plan was considerably larger than that allowed by the 35:100 ratio in the A.G.N.A, the Z Plan made it inevitable that Germany would renounce the A.G.N.A. Over the winter of 1938-39, the fact that it became increasing clear to London that the Germans no longer intended to abide by the A.G.N.A played a role in straining Anglo-German relations. Reports received in October 1938 that the Germans were considering denouncing the A.G.N.A were used by Lord Halifax in Cabinet discussions for the need for a tough policy with the Reich. The German statement of December 9, 1938 that they intended to build to 100% ratio allowed in submarines by the A.G.N.A. plus to build to the limits in heavy cruisers led to speech by Chamberlain before the correspondents of the German News Agency in London warning of the "futility of ambition, if ambition leads to the desire for domination". At the same time, Lord Halifax informed Herbert von Dirksen
Herbert von Dirksen
Herbert von Dirksen was a German diplomat who is best remembered as the last German Ambassador to Britain before World War II.- Biography :...

, the German Ambassador to Britain that his government viewed the talks to discuss the details of the German building escalation as a test-case for German sincerity. When the talks began in Berlin on December 30, 1938, the Germans took an obdurate approach, leading London to conclude that the Germans did not wish for the talks to succeed.

In response to the British "guarantee" of Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...

 of March 31, 1939, Hitler, who was enraged by the British move, stated "I shall brew them a devil's drink". In a speech in Wilhelmshaven
Wilhelmshaven
Wilhelmshaven is a coastal town in Lower Saxony, Germany. It is situated on the western side of the Jade Bight, a bay of the North Sea.-History:...

 for the launch of the Admiral Tirpitz battleship, Hitler threatened to denounce the A.G.N.A. if the British persisted with their "encirclement" policy as represented by the "guarantee" of Polish independence. On April 28, 1939 Hitler denounced the A.G.N.A. To provide an excuse for the denunciation of the A.G.N.A, and to prevent the emergence of a new naval treaty, the Germans began refusing to share information about their shipbuilding,and thus left the British with the choice of either accepting the unilateral German move or rejecting it, thereby providing the Germans with the excuse to denounce the treaty. At a Cabinet meeting on May 3, 1939, the First Lord of Admiralty, Lord Stanhope
James Stanhope, 7th Earl Stanhope
James Richard Stanhope, 13th Earl of Chesterfield and 7th Earl Stanhope KG, DSO, MC, PC , styled Viscount Mahon until 1905, and known as The Earl Stanhope from 1905 until 1967, was a British Conservative politician.-Background:Stanhope was the eldest son of Arthur Stanhope, 6th Earl Stanhope, and...

stated that "at the present time Germany was building ships as fast as she could but that she would not be able to exceed the 35 per cent ratio before 1942 or 1943". Chatfield who by this time was serving as Minister for the Co-ordination of Defence commented that Hitler had "persuaded himself" that Britain had provided the Reich with a "free hand" in Eastern Europe in exchange for the A.G.N.A. Chamberlain stated that Britain had never given such an understanding to Germany, and commented that he first learned of Hitler's belief in such an implied bargain during his meeting with the Führer at the Berchtesgaden summit in September 1938. In a later paper to the Cabinet, Chatfield stated "that we might say that we now understood Herr Hitler had in 1935 thought that we had given him a free hand in Eastern and Central Europe in return for his acceptance of the 100:35 ratio, but that as we could not accept the correctness of this view it might be better that the 1935 arrangements should be abrogated". In the end, the British reply to the German move was a diplomatic note vigorously disputing the German claim that Britain was attempting to "encircle" Germany with hostile alliances. The German denunciation of the A.G.N.A. together with reports of increased German shipbuilding in June 1939 caused by the Z Plan played a significant part in persuading the Chamberlain government of the need to "contain" Germany by building a "Peace front" of states in both Western and Eastern Europe, and of increasing the perception within the Chamberlain government in 1939 that German policies were a threat to Great Britain.

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