to raise the Dobruja issue, only to end with the Italian invasion of Albania on 7 April 1939. These conflicts spread rapidly, eventually triggering World War II. The goal of Atatürk to protect southeast Europe failed with the dissolution of the pact. In 1938, the Turkish Army at peacetime strength consisted of 174,000 soldiers and 20,000 officers forming 11 army corps, 23 divisions, one armoured brigade, 3 cavalry brigades, and 7 frontier commands. Issue of Hatay Turkish Prime-Minister İsmet İnönü was very conscious of foreign policy issues. During the second half of the 1930s, Atatürk tried to form a closer relationship with Britain. The risks of this policy change put the two men at odds. The Hatay issue and the Lyon agreement were two important developments in foreign policy that played a significant role in severing relations between Atatürk and İnönü. In 1936, Atatürk raised the "Issue of Hatay" at the League of Nations. Hatay was based on the old administrative unit of the Ottoman Empire called the Sanjak of Alexandretta. On behalf of the League of Nations, the representatives of France, the United Kingdom, the Netherlands, Belgium, and Turkey prepared a constitution for Hatay, which established it as an autonomous sanjak within Syria. Despite some inter-ethnic violence, an election was conducted in 1938 by the local legislative assembly. The cities of Antakya (Antioch) and İskenderun (Alexandretta) joined Turkey in 1939. Economic policies Atatürk instigated economic policies to develop small and large scale businesses, but also to create social strata (i.e. industrial bourgeoisie coexisting with the peasantry of Anatolia) that were virtually non-existent during the Ottoman Empire. The primary problem faced by the politics of his period was the lag in the development of political institutions and social classes which would steer such social and economic changes. Atatürk's vision regarding early Turkish economic policy was apparent during the İzmir Economic Congress of 1923. The initial choices of Atatürk's economic policies reflected the realities of his time. After World War I, due to the lack of any real potential investors to fund private sector industry, Atatürk established many state-owned factories for agriculture, machinery, and textile industries. State intervention, 1923–1929 Atatürk and İsmet İnönü's pursuit of state-controlled economic policies was guided by a national vision; their goal was to knit the country together, eliminate foreign control of the economy, and improve communications within Turkey. Resources were channeled away from Istanbul, a trading