711.94/216210/14
Memorandum of a Conversation
Conformably with an arrangement made earlier in the day, Mr. Hamilton, Mr. Ballantine and Mr. Schmidt43a met with Colonel Iwakuro and Mr. Wikawa at the latter’s apartment.44
Asked by Colonel Iwakuro whether we had any suggestions, Mr. Ballantine suggested a rewording of paragraph one of section two on the basis of wording which the Japanese had proposed in their draft of June 845 for inclusion in the third paragraph of the preamble with the addition of the word “unprovoked” … Section two, paragraph one, as reworded would thus read as follows:
“The Government of Japan maintains that the purpose of the Tripartite Pact was, and is, defensive and is designed to contribute to the prevention of the unprovoked extension of the European war.”
In reply to the question whether this represented everything which we desired in this paragraph, Mr. Ballantine said that these suggestions were purely tentative. He added, however, that this rewording was only part of an idea which we wished to discuss. The Japanese had objected to the incorporation of excerpts from the Secretary of State’s speech in the Annex and Supplement on the part of the Government of the United States drafted May 31, 1941. It had occurred to us that there might be arranged an exchange of letters in which the Secretary of State would set forth fully the attitude of [Page 479] the United States toward the European war and would incorporate parts of his speech clarifying that attitude. The Japanese would then on their part reply to this letter.
Colonel Iwakuro said that the reaction in Japan to the incorporation of statements from the Secretary’s speech would be unfavorable, whether in the form of an exchange of letters or as an annex and supplement to the agreement, and he urged that this question be set aside for clarification after the agreement had been reached and an atmosphere of cordiality created in the relations between Japan and the United States. He added that they had already fully informed the Japanese Government of the attitude of the United States toward the European conflict as expressed in speeches by the Secretary of State.
Mr. Wikawa asked what type of reply would be expected and whether it would be “secret” or “published”. Mr. Hamilton said that he did not believe the reply could be treated as “secret” but that it need not necessarily be published.
Mr. Hamilton inquired if it would be possible, as the Secretary of State had suggested, for Japan by some unilateral act to indicate that it appreciates and understands the attitude of the United States toward the European war and realizes that that attitude is based on self-defense. In reply, Colonel Iwakuro asked whether the United States would entertain an expression by Japan of its own views of self-defense. Mr. Hamilton immediately pointed out that this question was not one merely of self-defense for Japan and that it would not have arisen except for the Japanese attitude toward the European war as expressed by the conclusion of the Tripartite Pact. Colonel Iwakuro then said that Japan would want to send a letter incorporating various statements which had been made by Japanese leaders. Mr. Hamilton expressed the opinion that such a reply would probably not lead to a meeting of minds.
Colonel Iwakuro discussed at some length the deterioration of relations between the United States and Japan and the division of opinion in Japanese circles which had preceded the conclusion of the Tripartite Pact. The attitude of the United States, Colonel Iwakuro said, had left to Japan no other course than to sign the Tripartite Pact. For this reason, he said, it was most desirable that an improvement in American-Japanese relations be accomplished before taking up the consideration of such detailed controversial issues. He stated emphatically that Japan cannot at this time repudiate the Tripartite Alliance. He felt that once “good feeling” had been restored, other differences would be satisfactorily ironed out.
Mr. Hamilton suggested that we take careful note of what had been said and that we turn to the consideration of economic matters. The question of Japanese special companies, particularly the North [Page 480] China Development Company and the Central China Promotion Company, was brought up. Speaking hypothetically, Mr. Ballantine inquired whether American companies would be allowed to operate similar enterprises to those engaged in by subsidiary concerns. Colonel Iwakuro replied that Japan’s policy was to welcome other companies and that they would be allowed to operate similar enterprises. Regarding present monopolies, Mr. Wikawa said that under Chinese law companies engaged in certain enterprises must necessarily have more than fifty percent Chinese ownership, but that with this exception there were no restrictions or monopolies and that Japan’s policy would be strictly in accordance with Chinese law.
Mr. Hamilton pointed out that we are continually receiving reports which indicate that American citizens engaged in business enterprises in occupied China are very bitter because of the Japanese restrictions and obstructions interfering with the prosecution of their business affairs. He inquired how we could justify the Japanese acts to these American businessmen. Colonel Iwakuro replied that this situation prevails but that it is caused by the existence of hostilities and the necessity of taking extraordinary measures for the prosecution of the hostilities. In reply to a question by Mr. Hamilton, Colonel Iwakuro said that all restrictions had been inspired by war conditions and that when peace had been restored these restrictions would all be removed and “fair and square” treatment accorded to nationals of all third powers. In reply to the question whether the Japanese would consider putting in a letter or an annex clarification of Japan’s intentions regarding currency, equality of economic opportunity and of treatment, et cetera, the Japanese said that if we would present a letter asking any questions of that nature, the Japanese Government would be glad to reply fully and satisfactorily. The Japanese reiterated assurances that American citizens and companies would be welcomed in China and that there will be no discrimination.
Mr. Ballantine then pointed out that in certain places in occupied China it was possible for American citizens to do business only through the agency of Japanese subjects and Japanese banks. Colonel Iwakuro said that this situation also was the result of war conditions and certain extraordinary circumstances deriving therefrom, for example, the necessity to maintain the value of Japanese military notes circulating in central China. Mr. Hamilton pointed out that our present discussion was directed toward peace and therefore not concerned with the existing situation and conditions. He inquired whether, when peace is restored, these restrictions resulting from war exigencies would disappear at once or after one year or two years and asked for an expression of whatever thoughts the Japanese might have on this subject. Colonel Iwakuro immediately replied that these restrictions would disappear as soon as peace [Page 481] and order were restored. Mr. Hamilton asked for a more specific answer, pointing out that in 1903 the United States had in a treaty with China stated that extraterritorial rights would be given up as soon as conditions were right.46 Colonel Iwakuro replied that the exact moment of the removal of restrictions would depend upon the type of transaction or commodity involved and cited the example of the military notes in central China which must be taken up and converted into the legal currency of China.
In reply to a question by Mr. Ballantine, Mr. Wikawa said that even some Japanese merchants were complaining of the lack of a free market in China, but that when peace and order were restored free markets would return.
Mr. Ballantine brought up the question of the relations between the Chinese Government at Chungking and the Government of Wang Ching-wei following the negotiation of peace between Japan and the Chinese Government at Chungking. Mr. Ballantine said that in a previous conversation the Japanese had indicated a desire to leave to the Chinese the working out of the relationship between the Government of China at Chungking and the Wang Ching-wei Government at Nanking. Colonel Iwakuro stated that Japan desires that representatives from both Chiang Kai-shek and Wang Ching-wei be present at the negotiations of peace between Japan and China and that those negotiations were to be preceded by informal conversations with both parties. Mr. Hamilton suggested that such an arrangement would mean that Chiang Kai-shek would probably be required to recognize, at least informally, the position of Wang Ching-wei. Mr. Wikawa replied that the Chinese were very clever politicians and negotiators and that they would be able to get together. He added that even at present, although the two groups are supposed to be entirely separate, the Nanking officials fully inform Chungking of everything the Japanese tell them and in many ways the two “factions” are really one government. Colonel Iwakuro said that such a general peace treaty would be concluded, but that the Governments of Wang Ching-wei and Chiang Kai-shek would coalesce and form one Chinese Government before signatures were affixed to that treaty. Mr. Hamilton said that we would give careful consideration to what had been said with a view to furthering future conversations.
Colonel Iwakuro said that he would like to pose a question as to what we thought of his suggestion for a statement to be incorporated in an annex or an exchange of letters to the effect that the Governments of Japan and of the United States mutually recognize the defensive position each maintains respectively in the East Asia area and in the Western Hemisphere. Mr. Hamilton pointed out that the [Page 482] policy of this Government was to treat each and every nation in the Western Hemisphere as equal sovereign countries in all respects and that an era of good feeling had been created in the Western Hemisphere only after the adoption of our so-called Good Neighbor policy. Colonel Iwakuro’s suggestion might offend some of the American Republics and would raise many difficulties. As this suggestion had not been contained in any of the other drafts, Mr. Hamilton believed that it would be better to leave it out.
As a second question, the Japanese asked whether a statement could not be made by the United States that it has no ambitions for new political or military bases in East Asia. In reply to a suggestion that the statement in section six to the effect that neither Government has territorial designs in the Pacific area covered this question, Colonel Iwakuro said that there was in that statement no mention of military bases. Mr. Hamilton pointed out that to bring up the question of military bases at the present time might raise many new issues and that such questions might better be left for consideration at a conference after peace had been restored. Colonel Iwakuro agreed that details might be left for later negotiations but urged consideration of a statement of certain broad principles having to do with the question of military bases. Mr. Hamilton agreed that principles which could be generally accepted might be included, but that it would be better to leave all debatable questions for later consideration. Colonel Iwakuro asked whether the United States could make a statement that no new bases would be acquired and added that an enunciation on the part of the United States of such a principle would emphasize the peaceful intent of this country. Mr. Hamilton pointed out that Japan has been demanding and moving toward the establishment of bases in Thailand, Indochina, Hainan and other areas in the Southwest Pacific and that the American public would obviously immediately object to the United States’ making such a statement limiting its freedom of action under present circumstances. He went on to point out that, if Japan considered the question of acquiring military bases separate and apart from the renunciation of any territorial designs, a new question was brought up. He asked whether Japan would expect to obtain military bases in the Pacific area despite the fact that Japan does not have territorial designs there. He inquired whether the Japanese concept of this question included the possibility of acquiring military bases. Colonel Iwakuro replied that it did not, but that a statement by the United States that no new military bases would be acquired by this country was closely related to Japan’s possible need for military bases in the Southwest Pacific. He mentioned in passing the possibility of [Page 483] the United States’ acquiring a military base at Singapore and requested that this question be given careful consideration.
The Japanese urged that discussions be carried on with all possible speed and asked when they could telegraph Tokyo. Mr. Hamilton pointed out that there were outstanding three large questions: economic non-discrimination in China, stationing of Japanese troops in China, attitude of the two Governments toward the European war, and added that the question of a statement regarding military bases presented an additional serious question. He said that we would want to consider the possibility of discussing these questions with Mr. Hull, but that Mr. Ballantine would telephone Mr. Wikawa tomorrow with a view to arranging a further discussion.