893.51/2279: Telegram

The Ambassador in France (Wallace) to the Acting Secretary of State

917. On June 21 I handed to Mr. Pichon a note in the sense of your telegraphic instruction 8546, June 11th, 10 a.m.25 with slight modifications growing out of the decision to prolong the renewal of the old consortium rather than holding meeting in Paris before June 18th, to constitute the new one. Subsequently a conference was held at the Foreign Office by representatives of the French group as the result of which, so I am informed unofficially, the Minister for Foreign Affairs adheres to the proposed formula set forth in his note of June 6.26 He points out that in effect this formula contemplates no practical change from the wording of the American formula and yet avoids the necessity of making defense on political grounds for it is obvious that French Government’s position at this stage is a delicate one. We have all been reluctant to urge our views to the point of real embarrassment for the Foreign Office. Furthermore the French group is distinctly of the opinion that the formula of their Foreign Office will constitute an executive and exclusive support and it favors the view of the Foreign Office rather than our own. The view of all of us here is [that] French formula, as composed, is so complete as to constitute no real change and that it would be well, if possible, to accept it without further discussion. This view is also reinforced [by] the belief that this interrogation [sic] may also assist in the solution of the present British situation. On this latter point Lamont will confer with Addis and British Foreign Office and Treasury officials in London on Friday.

Referring to your 8699, June 23rd, 4 p.m., Lamont has communicated with French group which is now considering matter and will secure views of British on Friday. I have taken steps to ascertain and will advise the Department as promptly as possible what the attitude of the French and British Government is with reference to the proposal to proceed as a three power group under the conditions stated. With the approval of French and British groups Lamont [Page 458] has handed to Odagiri reply to his recent letter in which he advised that as far as the banking groups are concerned any attempt to exclude Mongolia and Manchuria from the scope of the consortium would be inadmissible. He adds:

“The whole question that you bring up is one of such grave importance that we feel it is beyond the immediate competence of the financial groups to discuss. I am therefore bringing the matter to the attention of the Department of State at Washington. I presume that the other groups will take similar action with respect to their own Foreign Offices.”27

Wallace
  1. Ante, p. 447.
  2. Ante, p. 443.
  3. The final text of Mr. Lamont’s reply, a copy of which was transmitted to the Department of State, at its request, by the American group, July 19, 1920, is as follows (File No. 893.51/2876):

    Paris, June 23, 1919.

    Dear Sir: I have before me your letter of June 18, delivered to me at London and communicating to me for the information of the American Group the instructions which you have received from Tokio as to “the rights and options held by Japan in the regions of Manchuria and Mongolia where Japan has special interests.” You have, as I understand it, sent a letter in a similar sense to Sir Charles Addis, of the Hongkong and Shanghai Banking Corporation for the British Group, and M. Simon, of the Banque de l’lndo-Chine, for the French Group.

    For your information I beg to state that I have conferred informally with both the British and French Groups, and our views of the matter that you bring up are in accord. We cannot but believe that there is some misunderstanding upon the part of your principals in the matter, for if they were to make such an attitude final, the effect upon the relation of Japan to the New Consortium would be obvious. Mongolia and Manchuria are important parts of China, and any attempt to exclude them from the scope of the Consortium must be inadmissible. The “special interests” to which you allude have, in our opinion, never had to do with economic matters.

    The whole question that you bring us is one of such grave import that we feel that it is beyond the immediate competence of the financial groups to discuss, and I am therefore bringing the matter to the attention of the Department of State at Washington. I presume that the other groups will take similar action with respect to their own Foreign Offices.

    We have noted your reference to the declaration made by Mr. Takeuchi on behalf of the Japanese Banking Group and recorded in the Minutes of the Conference on June 18, 1912, at meeting of the six banking groups held in Paris on that date. For your information I beg to recall to you that at the same time there was recorded in the Minutes of the Conference the following declaration: “The British, German, French and American Groups stated that they were unable to accept or consider either of these declarations upon the ground that they were not competent to deal with political questions.” This declaration was accepted in conformity with the statement made by the Japanese Ambassador to Mr. Addis in London on June 11, 1912.

    I remain [etc.]

    Thomas W. Lamont