As the Lausanne negotiations hit a dead-end and were suspended, Mustafa Kemal gave a speech at Izmir Economic Congress on February 17, 1923 and made it clear that there would be no concessions on the capitulations:
Ottoman Empire was deprived of its independence physically and effectively. If a country cannot levy taxes on foreigners on its lands as it does on its own citizens, if a country is banned from regulating its own customs… And, if a country is not allowed to practice its rule of law for foreigners living on her lands, then that country is not independent…(SOURCE)
These words clearly manifested how the abolishment of the capitulations was crucial for the Turkish side. So much so, the suspension of the talks due to the capitulations disagreement did nothing to weaken the determination of the Turks. The Turkish side, having just endured a war that continued for ten straight years, and having lost almost everything, didn’t hesitate for a moment to start preparations for war again. When the Lausanne negotiations came to a halt due to the issue on capitulations, Mustafa Kemal ordered the Turkish army to start war preparations.
The truth is, the Allied Powers didn’t want the Lausanne negotiations to be suspended either. Having fought in WWI, that caused immense destruction, none of them were willing to resume hostilities; especially after the horrible war of four years destroyed both the victors and the losers. Furthermore, European countries couldn’t afford to be ‘not on the side of peace’. The Western public, weary and battered, wanted peace and therefore, the Allied Powers had to yield and not be persistent on capitulations. Being the side that stopped the peace negotiations was equal to being the side that did not want peace and it was clear that such an administration would be punished by not only its own public, but other countries as well. Europe wouldn’t risk that.
Furthermore, the Soviet Union, which had signed a treaty of friendship with Turkey in 1921, declared that if a new war broke out, it would fight alongside Turkey. This situation completely tipped the balance.
Seeing the decisive stance of Turkey, the Western countries took action to resume the talks and thus the second part of the Conference of Lausanne began on April 23, 1923. Lord Curzon and former ‘celebrities’ didn’t attend this time. Horace Rumbold, the High Commissioner to Istanbul, was heading the British delegation and the conference.
Capitulations represented the biggest obstacle to concluding the Conference of Lausanne. The Westerners didn’t want to give up on them, especially under heavy pressure from various economic groups. On the other hand, Turkey was adamant on refusing all sorts of limitations on its independence. Therefore, no agreement could be reached in the negotiations, and talks continued until May 4. Other financial issues continued to be a source of difficulty, as well.
After long discussions, it was decided to add the following clause to the treaty with regard to the capitulations:
Article 28: Each of the High Contracting Parties hereby accepts, in so far as it is concerned, the complete abolition of the Capitulations in Turkey in every respect.(SOURCE)
In the meantime, the other parties demanded that health capitulations should continue in Istanbul in the form of a commission of physicians, but the Turkish side rejected this, too. In the end, it was decided that for five years, three European doctors would be allowed to work in quarantine works in the capacity of consultants. This ended the health capitulations, as well. Five years later, these three foreign doctors were dismissed and the health-care industry was made completely domestic. Atatürk mentioned in his famous Nutuk (the Great Speech), ‘this wasn’t a capitulation. We agreed that a couple of foreign doctors serviced for five years’.(SOURCE)
In other words, the unyielding stance of the Turkish delegation saved the new Turkish Republic from capitulations, the shackles of the past. This way, Turkey not only achieved its full independence, but also completely dashed the British deep state’s dreams of ‘colonization’. The British deep state failed to repeat its scheme of slyly infiltrating states and building its economic and legal hegemony in new Turkey. That is why the capitulation concession on the part of the British delegation in the Lausanne negotiations was seen as a major defeat. Time, in its issue of April 14, 1924, made the following comment on this development:
“The Treaty of Lausanne was the first conspicuous failure of the British diplomacy in more than a century.” The piece continued with the following interesting remark that showed how the outrageous plans of the British deep state backfired: “In effect, the Lausanne Settlement turned Europe bag and baggage out of Turkey instead of turning Turkey bag and baggage out of Europe.“(SOURCE)