Between the Devil and the Deep sea.

The Netherlands have for a long time been known for its tradition of free trade and non-intervention. This was also the case during the beginning of the Great Depression. From the early 1930s, however, most surrounding countries were changing their trade policy into more protectionism. The Dutch trade faced increasing difficulties and an internal debate grew about how to deal with these external threats concerning the Dutch economy. At first the Dutch government was reluctant to change its policy but after de failure of The London Conference it became clear that free trade and non-intervention were out of date. The Dutch trade policy thus developed into a more active policy with protectionist features. The Dutch trade relations with Britain became all the more important, because the trade relations with Germany faced increasing difficulties and became limited by German trading quota’s. The British were on their turn also a difficult trade partner. The Ottawa Conference had resulted in imperial preferential politics favouring trade within the British Empire. Furthermore they ignored many agreements made in earlier trading treaties. This was the case in the agreements made in the Sumatra Treaty of 1871. The treaty agreed upon favourable import tariffs for Britain on Sumatra as well as favourable tariffs for the Netherlands in British Guinea. But Britain announced higher import tariffs in their colonies for all countries including the Netherlands. A fierce debate between Dutch government officials started whether to comply Britain to its agreements or to let the matter rest. They all agreed that the British violations of the treaty harmed the Dutch trade, but they disagreed upon the most effective response. This discussion prolonged for several years. One of the most important arguments against compliance was that an interpretative discussion with Britain about the contents of the treaty might threaten Dutch-British political relations. In 1937 the Dutch government finally responded in a letter to the British Foreign Office that they: “reserved themselves the right to refer to this matter again in the future and that any payments of customs duties on Netherlands goods in British Eastern ports which are in excess what they should be to our interpretation of the treaty must be considered as being without prejudice to future reference.” The political climate within Europe became more and more complicated and a dispute with the most important informal ally was seen as dangerous. The Dutch treatment of the British violations of the Sumatra Treaty was thus the outcome of a trade-off between economic interests and national security, which is in line with Realist theories about international relations and the Dutch international position. The Dutch international policy has always been a policy of trade-offs and responding to external threats. The shift towards a more active policy should therefore not so much be seen as a real shift but rather as an adaptation which gives the most security to our vulnerable position.