File No. 893.51/1873

The Acting Secretary of State to the French Ambassador ( Jusserand )

No. 2085

Excellency: I have the honor to acknowledge the receipt of your excellency’s note of February 15, 1918, relating to the proposed participation by the French group in a loan to China for currency reform in which there is communicated to me the information that the French group is disposed on its part to accept the proposed arrangement whereby a portion of that group’s participation would be advanced by the American group but with the reservation that no reimbursement would be made until circumstances should permit the flotation of Chinese loans in European markets.

I note that in the opinion of the Government of France it is deemed desirable that an American group be organized as soon as possible and take part on its own account as well as that of the French and English groups in the contemplated transaction.

In reply I have to assure your excellency that the American Government is greatly interested in the proposed reform of the currency in China and is hoping that the way will be opened for the participation of an American group in the proposed loan for that purpose. The possibility of such participation is now a matter under consideration by the United States Government.

I am interested to learn from your excellency’s note that the British group is disposed to accept participation under an arrangement for an advance by the American group of a portion of the British share to be repaid later. The latest information received by the Department of State, previous to your note under acknowledgment, was to the effect that the British Minister of Finance was unwilling to have the British group participate. The Department was informed also that if such participation could be agreed to by the British group it would first be necessary under the intergroup agreement to obtain the consent of the Japanese group to an advance by the American group of the British share.

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So soon as a definite decision is made by the United States Government as to the advisability of allowing American participation in the proposed loan, I shall be glad to inform your excellency of that decision.

Accept [etc.]

Frank L. Polk