493.11/878: Telegram
The Minister in China (Schurman) to the Secretary of State
[Received 5:13 p.m.]
6. Deferred Boxer indemnity payments were resumed December 31st.
Belgian, French and Italian Ministers have declined to accept payment by telegraphic transfer at exchange rate which at present exchange would reduce amount received to about three-eighths of sum due on basis of payment in gold.
According to article 6 of protocol of 190111 and exchange of notes of July 2nd, 1905,12 total indemnity constitutes a debt in gold and they argue that this must be paid in gold.
Chinese maintain that debt in gold can only mean gold standard debt as opposed to silver standard debt, that they have only to pay in the currency of each interested country at the rate fixed per tael in 1901 and 1905, and that the fact that paper franc which is currency in three countries has depreciated does not concern them.
[Page 593]Diplomatic body hold broadly that Chinese point of view is untenable and contravenes letter and spirit of existing documents.
Representatives of protocol powers propose therefore to address identic note to Chinese Government supporting contention that debt must be paid in gold. Please telegraph whether I am authorized to join in identic note.