The Secretary of the British Embassy ( Craigie ) to the Chief of the Division of Far Eastern Affairs, Department of State ( MacMurray )

My Dear MacMurray: With reference to our conversation on the 23rd instant, I find on inquiry that the Japanese proposals to us for a relaxation of the arms embargo were communicated to the State [Page 549] Department in a Note from this Embassy No. 88 dated February 5th 1920,53 and in a Memorandum dated 3rd. January 1921.54

As regards the suggestion that the Vickers’ contract constituted a violation of the arms embargo it may perhaps be as well for me to recapitulate here what I mentioned verbally. As stated in the contract itself, it is for the provision of a “commercial type” of aeroplane. The contract was signed with the duly authorized representative of the Chinese Government and not with the Ministry of War, and the mere fact that some of the machines were seized during the fighting round Pekin last summer by certain Chinese generals who have since proved incapable of using them, constitutes no evasion of the arms embargo. Sir Beilby Alston reported last December that in point of fact only one Handley Page machine had been used in the fighting. This was due to the action of an intoxicated Swiss mechanic who, alone of the Company’s employes, ignored the instructions of the British Legation. He appears to have been engaged in bomb dropping and was immediately dismissed in consequence. No British machines have been used for reconnaissance purposes and, with this one exception, no British machine had, up to last December, been used for military purposes at all. Sir Beilby Alston considers that this is a proof of the efficiency of the drastic measures which have been taken by the British authorities.

In this connection it is worthy of note that, according to information received from His Majesty’s Legation at Pekin, American aeroplanes were actually used in the fighting in South China, and on at least one occasion were employed in dropping bombs at Canton.

In the Note from this Embassy No. 123 of February 25th 1920,55 we notified the State Department that His Majesty’s Government did not consider that aircraft fell within the scope of the Arms Traffic Convention,56 unless fitted or supplied with guns or bombs, bombing apparatus or ammunition. From that expression of view the United States Government have never, so far as we are aware, recorded their dissent, and though it was adopted by His Majesty’s Government quite independently of any question of the arms embargo in China, yet its bearing upon the point under discussion is evident.

The above does, I think, clearly demonstrate that the Vickers’ contract cannot in any sense be regarded as a breach of the embargo. As I pointed out in the course of our conversation, it is for considerations based rather on Consortium than on embargo grounds that His Majesty’s Government have refused to countenance the recently concluded Handley-Page contract.

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Sir Auckland Geddes57 has despatched a telegram designed to correct the impression which appears to prevail in London on the subject of the lukewarmness of the American Government in regard to the China arms embargo policy and explaining the difficulties with which they are confronted as regards the passage … of legislation for the purpose of continuing the existing prohibition of the export of war material to China.

Believe me [etc.]

R. L. Craigie