893.51/2395: Telegram
The Minister in China (Reinsch) to the Secretary of State
[Received 4.25 p.m.]
Your telegram August 30, 2 p.m. No communication has been made to the Chinese Government concerning the withholding of financial assistance, with the exception of the memoranda inclosed in my despatch 2573 [2572] March 7th14 which related entirely to the War Participation loan which had been objected to by the Shanghai Peace Conference. While an agreement for generally withholding financial assistance was proposed the matter never got beyond the stage in my despatch 2446 January 1015 although there exists tacit understanding to make no loan to the Central Government which might be utilized for resumption of hostilities, also considered impolitic to make any Central Government loans except conditioned upon understanding with South. I do not believe any tacit understanding exists with respect to provincial loans.
[Page 522]Hupeh loan contract contains nothing concerning purposes or supervision. Loan is presumably made for administrative provincial expenses. Any conditions which the Department might consider necessary for safeguarding could probably be added. Provincial Government bank and Consul General Cunningham hope for earliest possible decision.