Ambassador Wright to the Secretary of State.

No. 8.]

Sir: As an indication of the serious attention that is being given by the Japanese statesmen to the various problems relating to Manchuria I have the honor to report that following the tour of the premier, Marquis Saionji, and his suite of experts already referred to in the embassy’s dispatches No. 440 of April 16 and No. 463 of May 24, it is now announced that another deputation consisting of several parties of high officials will shortly proceed to Manchuria on similar tours of inspection. The first of these parties, consisting of Admiral Viscount Ito, member of the high military council, Field Marshal Count Nozu, Admiral Inouye and Privy Councillors Kioura, Nishi, and Takasaki started from Tokyo on the 30th ultimo.

Within the last few days a number of articles have appeared in the Japanese newspapers which seem to forecast the Japanese Government’s policy with reference to commercial and industrial industries in Manchuria. I have the honor to inclose translations of a number of these, together with a clipping from the Japan Mail of May 29, relating to the official deputations above referred to.

I have, etc.,

Luke E. Wright.
[Inclosure 1—Translation.]

japanese export trade in manchuria in korea the japanese government’s policy.

[Editorial from the Jiji Shimpo of May 30, 1906.]

As a result of the Japanese-Russian war Manchuria is now within our sphere of influence. Though there is a splendid opportunity for our weaving industry to develop, we regret to publish the following statistics of the imports of cotton cloths to Manchuria during 1904:

Article. American Japanese.
Taels. Taels.
Sheetings 3,643,515 5,763
Drills 1,704,385 12,443
Total 5,347,900 18,206

[Page 193]

But in order to open new markets for cotton cloths in the interior of Manchuria, the following points should be observed:

The Chinese have strong confidence in any long-established trade-mark. It is therefore necessary to have definite trade-marks and win their confidence.
Besides having definite trade-marks, it is also necessary to maintain unity in the quality of articles.
It is necessary to produce large amounts of articles in order to command the markets.
Besides the three things already referred to, it is necessary to have able agents.

A union for exporting cotton cloths from Japan to Manchuria has been organized by the Osaka, Miye and Okayama spinning companies, and the Kanekin and Temma weaving companies. The Mitsui Bussan Kwaisha is to act as their sole agent in Manchuria. All the members of the union have decided to have a common trade-mark and to export at least 12,000 bales (about $1,200,000) of cotton cloths a year. The Mitsui Company has also decided to work for the union without any compensation. Remarkable progress, however, can hardly be expected in Manchuria trade unless the traders have banking and other facilities, as there are powerful competitors. Though in Korea the Japanese have succeeded in driving out English and American cotton cloths, we are not yet to be satisfied. The following are the essential points of the statement made by the spinning and weaving companies to the ministers of finance and of communications in asking for aid:

To have about 6,000,000 yen advanced on the exported goods. Bills of exchange to be paid in Manchuria after 4 months with 4 per cent interest.
As there is no other way of extending the markets for the exports other than to sell them on credit, allowing a long time for payment. The companies hope that the authorities may so arrange matters as to have goods delivered before payment of bills is made, if the party concerned is reliable.
That the Chinese Eastern Railway will charge nothing or half rates on the exports referred to.
That the steamships carrying the exports will charge half rates.

Mr. Sakatani, minister of finance, who has been occupied with the problems of extending the markets for Japanese goods in Manchuria and Korea, was pleased with the determined steps taken by the companies referred to, including the Mitsui Company. By order of the minister of finance, the chief of the bureau of finance in the finance department, conferred with the governors of the Nippon Ginko and the Yokohama Specie Bank on this matter. They have decided to advance money without any limitations on all the exports to Manchuria at the rate of 4.5 per cent. The notification to this effect was to be sent out yesterday to the banks’ branches in Manchuria. The minister of communications also conferred with the ministers of finance and of agriculture and commerce, and they seem to have decided to act in cooperation. The war department is to be consulted for making a special arrangement with the Chinese Eastern Railway, while the authorities will issue orders to the Nippon Yusen Kaisha and the Osaka Shosen Kaisha.

No negotiation has yet been made with the Dai Ichi Ginko about 3,000,000 yen to be advanced on the exports to Korea; but as the ministers of finance and of communications agree with each other on this matter, the Dai Ichi Ginko will also consent to advance the money at the rate of 4.5 per cent as soon as it is formally approached.

[Inclosure 2—Translation.]

japan’s export trade to manchuria and korea.

rebates on the interest of exchange.

It has already been reported in these columns that, for the purpose of encouraging export trade to Manchuria, the Yokohama Specie Bank has decided to advance money at the low rate of 4.5 per cent against the goods shipped to Manchuria. Upon further inquiry we have learned that any single exporter exporting 5,000,000 yen worth of articles will be paid rebates at the rate of [Page 194] one-half per cent. It will be seen, therefore, that those who export over 5,000,000 yen pay only 4 per cent for the money advanced against their goods. The drafts against the bills of lading thus to be bought by the Yokohama Specie Bank will be bought by the Government or the Bank of Japan at a lower rate of interest.

the dai ichi ginko and korean trade.

According to the statement of a director of the First Bank, it has close relations with Korea, and is anxious to develop our Korean trade as a post-bellum measure. If the Bank of Japan is willing to give it the necessary facilities, the First Bank will not hesitate to do just as the Specie Bank does for Manchurian trade.

the nippon ginko’s attitude.

The Specie Bank’s arrangement, says a director of the Bank of Japan, to advance money at a low rate of interest against merchandise shipped to Manchuria must be meant to encourage the Manchurian trade. If the Bank of Japan makes a special arrangement with the Specie Bank in this matter, it will not hesitate to do the same thing for the First Bank. Thus it will be seen that money at a low rate of interest will be advanced against the goods exported both to Manchuria and to Korea.

special arrangements.

There is no ground for the report that the Government has adopted the policy of protecting our exports to Manchuria and Korea. There is a considerable amount of money that the Government has to pay in Manchuria. Besides, the beans and bean cakes imported from Newchwang have to be paid for. These conditions always result in a one-sided exchange, and the inconvenience of shipping specie is felt. For this reason the Specie Bank has made the arrangement just referred to.

new markets.

The Mitsui Bussan Kaisha, sole agent in Manchuria for the five companies that have formed an export union, regards that union as a very important organ for developing Japan’s Manchurian trade, and has decided to work for the extension of markets without any compensation for a year. The company has already commenced the work, covering Newchwang, Dalny, Ańtung, Tieling, Mukden, Kuanchengtze, etc. The Mitsui Company is ready to popularize the union’s trade-mark by various means. For exporting rough cotton cloths to replace the native Chinese cloths a corporation with 200,000 yen for capital has been formed.

splendid opportunity for extending markets.

The Japanese civil administration office is now engaged in the work of exploitation. The Chinese in Manchuria have now a wonderful purchasing power owing to the influx of money during the recent war. It is now high time to take advantage of the new conditions and to export to Manchuria such things as the Chinese would like to have. Though a considerable amount of money is needed everywhere, and the scattered money should be collected as quickly as possible, the little encouragement that may be given to Manchurian trade will be a great gain in the future. The Chinese are peculiarly individualistic, and a large number of them will immigrate into Manchuria as they become used to Japan’s good administration. With the increase in immigrants we can extend the markets for our exports and make Manchuria one of our good customers.

[Inclosure 3.]


It is stated that the sequel of Marquis Saionji’s visit to Manchuria will be the immediate departure for that place of Admiral Viscount Ito, Field Marshal [Page 195] Nozu, and Admiral Inouye. These high personages are to proceed on a tour of inspection, and a similar intention is attributed to three other parties at later dates, one consisting of Admiral Togo and General Nogi; another of Baron Kioura, Marquis Ito, and Marquis Yamagata; and yet another of General Terauchi, Mr. Yamagata (minister of communications), and Mr. Mat-suoka (minister of agriculture and commerce). At a subsequent date a party of business men is expected to visit the three provinces.

Looking at the composition of these various parties one is led to infer that the Manchurian problem still awaits final solution as between the civil and the military views. We have little doubt that the former will ultimately carry the day, but it will occur to any thoughtful person that delay in such matters is very dangerous. Delay means an opportunity for the manufacture and circulation of rumors and the growth of a hostile public opinion in the West, the final issue thus being that when the liberal policy, inevitable from the first, is adopted, the Japanese will be said to have yielded to pressure rather than to the dictates of their own free judgment and volition.