893.74/413a: Telegram
The Secretary of State to the Minister in China (Schurman)
257. The Division of Far Eastern Affairs has been advised by the Chinese Minister that the Chinese Minister for Foreign Affairs has informed him that the Japanese Minister in China is engaging in more intensive activities in opposition to the contract of the Federal Telegraph Company using newspaper propaganda and personal representations to officers in the Cabinet and to leaders in politics, and that he has arranged to have a private interview with the Chinese President regarding the contract. The demand of the Japanese Minister that the Chinese Government cancel the Federal wireless contract is supported by propaganda advocating that China either buy up the contracts with both the Mitsui and Federal Telegraph Companies or else consent to have the Peking station of the Mitsui Company placed under the joint operation of “the three Powers”. It is [Page 825] not clear what the quoted phrase in Koo’s message means. The Japanese Minister threatens that unless satisfaction is received Japan will exact compensation from China for violating the contract with the Mitsui Company. Koo intimates in his telegram that this intensified activity when the Minister of the United States is away from Peking makes more difficult the position of those who are supporting the Federal wireless contract, and that his hands would be strengthened if he could quote some statement in evidence of the continued interest of the American Government in the undertaking of the Federal Telegraph Company. In commenting on the question Sze suggested that it might help if you should send a note to the Minister for Foreign Affairs expressing the satisfaction of the American Government upon learning that the necessary steps with a view to the buying of land for the installation at Shanghai and to the signing of the bonds for the undertaking have now been taken, and if you should add that the American Government is particularly pleased with these developments since they seem to bring within reach of actual fulfillment this project for direct, independent communication between China and the United States, an enterprise which has become intimately and definitely identified with the realization of the open-door principle in China.
Perhaps it will be advisable to consult Koo before sending him a note of the tenor suggested above.