File No. 793.94/229.


Referring to my cable of February 9, 7 p.m. The conference scheduled for today has been postponed, as I am credibly informed, for the reason that while the Chinese Government is willing to discuss ten of the demands the Japanese Government is insisting that the entire list shall be accepted in principle and negotiated on. The Chinese Government appears to be contemplating the adoption of a well defined policy regarding concessions; namely, that they shall cover only specific enterprises or activities over expressly delimited areas commensurate with the scope of the respective undertaking, to the exclusion of all arrangements for a general preference or options carrying contingent implications. In this way it is hoped that the principle of equal opportunity may be maintained. The Government is reported ready to make liberal grants of concessions to the Japanese on this basis.