893.51/2764: Telegram
The Secretary of State to the Ambassador in Great Britain (Davis)3
376. Referring to your 576, April 9 and Department’s 344 of April 3. The issue as to whether the restrictions attached by Japan to including the railroad line from Jehol to Taonanfu in the field of the consortium could be harmonized with the agreement made by Mr. Lamont with the Japanese group, apparently acting with the knowledge of their Government, was submitted by the Department to Mr. Lamont. Conditions 1 and 2 in section D were not contemplated by the agreement according to information now received from Lamont.
It is suggested by Lamont that the attitude taken by the Governments should be that they should give no decision on these issues which should be left entirely to the associations of bankers for their study. This attitude in our opinion would not be wise because of the basic political character of these two provisions. No. 1 is based on the idea that in Manchuria there must be no enterprise promoted that might give the South Manchurian line competition. The disavowal by Japan that she claims monopoly or preferred position would be contradicted by this assumption. In view of all of section [Page 528] D, provision no. 2 is based on the idea that for strategic reasons railroads may be constructed and operated by Japan without respect to the provisions of the treaty of peace ending the Russo-Japanese War4 which are contained in article 7. That this provision is needless likewise seems apparent as the Japanese claim in condition no. 2 is safeguarded by the agreement of the consortium saying that when the bankers of any one or more nations do not wish to take part the other associations or association may undertake the enterprise.
The Department finds itself for this reason in agreement with what seems to be the view of the Government of Great Britain that Japan in adding these two provisions regarding Manchuria and Mongolia is making a last endeavor to gain for herself an addition to what was contained in the understanding with Mr. Lamont by making conditions which she can use in the future to support new claims in these regions. You are instructed on this account to make an oral communication to the British Government advising them of our agreement with them and to propose that it might be wise for the Foreign Office to communicate with France regarding agreement upon joint action by the three Powers in opposing the new Japanese provisions. The Department trusts that arrangements may be made rapidly for such united action so that conditions regarding the organization of the combination for Chinese loans may be finally agreed upon before Mr. Lamont leaves the Chinese Capital. You are instructed, therefore, to suggest to His Majesty’s Government that we would be pleased to receive any proposal they might make as to how the united action should be made.
Decisions by His Majesty’s Government regarding this matter should be reported to our Embassy in France. Communicate this telegram to our Embassy there, as no. 766, for information and for guidance should Great Britain accept the proposal for united representation by the three Powers.
- See last sentence for instructions to repeat to Paris as no. 766.↩
- Foreign Relations, 1905, p. 826.↩