greater
part of the land tax to the service of the debt. The functions of the
Caisse were restricted to the receipt of the funds necessary for this
service. It was entirely deprived of its former power to interfere in
the machinery of government. Moreover, some L10,000,000, being
accumulated surpluses in the hands of the Caisse after meeting the
charges of the debt, were handed over to the Egyptian treasury. The
Egyptian government was henceforth free to take full advantage of the
financial prosperity of the country.

Evils of the Capitulations.

In one respect the Anglo-French agreement made no alteration--it left
untouched the extra-territoriality enjoyed by Europeans in Egypt in
virtue of the treaties with Turkey, i.e. the system of Capitulations.
One of the anomalies under that system had, it is true, been got rid of,
for, as has been stated, consular jurisdiction in civil matters had been
replaced in 1876 by that of the Mixed Tribunals. In criminal cases,
however, foreign consuls still exercised jurisdiction, but the main evil
of the Capitulations regime was the absence of any proper machinery for
enacting laws applicable to the whole of the inhabitants of Egypt. No
change could be made in any law applicable to Europeans without the
unanimous consent of fifteen foreign powers--a state of affairs wholly
incompatible with the condition of Egypt in the 20th century, "an
oriental country which has assimilated a very considerable portion of
European civilization and which is mainly governed by European methods."
It was, however, far easier to acknowledge that the Capitulations regime
was defective and had outlived its time than to devise a remedy and get
all the nations interested to accept it. The solution favoured by Lord
Cromer (vide Blue-books, _Egypt No. 1_ (1906), pp. 1-8, and _Egypt No.
1_ (1907), pp. 10-26) was the creation of a council--distinct from the
existing native legislative council and assembly--composed of Europeans,
which should have the power to pass legislation which when promulgated
by the Egyptian government, with the assent of the British government,
would bind all foreigners resident in Egypt. Every reservation for the
benefit of British subjects should enure for the benefit of subjects of
other powers. The jurisdiction exercised by consuls in civil and
criminal affairs Lord Cromer proposed should cease _pari passu_ with the
provision by the Egyptian government, under the powers conferred b