Secretary,

A full account of Count O'Kelly's conversations is appended dictated by himself.¹ If the estimate, made by M. Guerrero and M. Bethancourt, of our prospects under the proposed arrangement with Portugal, is correct, our line would appear to be to enter into the proposed arrangement. Mr. Lester, however, feels that our chances of success would be reduced, if it became known that we were working hand in hand with Portugal against Norway, because of Norway's prestige in the League.

What I do feel however is that it would be an extremely ticklish matter to carry out at this stage our part of the proposed bargain with Portugal, i.e. to obtain the support of the Commonwealth States for Portugal. It must be remembered, of course, that in any case under such an arrangement we would only undertake to advocate her candidature with the other members of the Commonwealth, and not to guarantee her the Commonwealth votes. The difficulty, however, would be to prevent the existence of such an undertaking between us and Portugal becoming known to the other members of the Commonwealth. I am very doubtful as to what you would think of the advisability of our entering into any such arrangement, which might, if it became known to the other members of the Commonwealth, be regarded by them as an intrigue in which, they might think, we were endeavouring to utilize their votes without placing all our cards on the table. What, therefore, we propose to do at the moment is to put off M. Guerrero and Vasconcellos by telling them that we cannot arrive at any decision in the matter until our Delegation arrives, and, in the meantime, to endeavour to find out, by casual and unofficial enquiries, from any representatives of the other members of the Commonwealth with whom we may come into touch, what States they are thinking of supporting for the Council. If we see that there is likely to be support for Portugal amongst them, we might find it possible to discharge our part of the bargain with Portugal, without any of the objectionable consequences referred to above.

Portugal, supported by the Latin American States, would undoubtedly be a strong candidate. She is a colonial Power; she is not a member of any group, and would, therefore, not 'close' a seat, and M. Vasconcellos is stated to be personally popular.

This new development has sprung on us quite suddenly, but I feel that for us, on the evidence presented to-day, there is a possibility of the proposed arrangement with Portugal containing the elements of a win. Before, however, I could recommend to our Delegation that we should agree to enter into the proposed arrangement with Portugal, I would require to know your reactions to the objections to this course which I have enumerated above.

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