Memorandum by the Minister in China (Johnson) of a Conversation With the Former Chinese Minister of Finance (Soong)65

During a call on Mr. Soong this evening I mentioned to him the fact that the Government had arranged to pay the two months’ arrears in American Boxer Indemnity payments over a period of ten monthly instalments. I said I had hoped that it might be possible that such a cumbersome method could be abandoned and the payments made at once. Mr. Soong said that he had arranged for the payments over a period of months when he was getting ready to resign, as he wanted to clear the matter up and did not wish to startle the incoming Minister of Finance with a sudden payment.

I informed Mr. Soong that I had certainly inferred from conversations which we had all had at the time that the Italians, the British and ourselves had been given the same proposal in regard to the postponement of indemnity payments for a year, but that I had suddenly discovered, after the passage of some months, that the Italians had been receiving their indemnity regularly all along, whereas in the case of the British and ourselves a postponement had been made. Mr. Soong remarked that he had not himself told me that the Italians had agreed to the same arrangement that was made with the British. I admitted this but said that nevertheless I had taken this for granted. Mr. Soong stated that the same proposal had been made to the Italians but that they had refused to accept it and that in the end they had spent the Italian indemnity for that period upon arms and munitions of war in Italy; that of course this had to be done very quietly and without any publicity and that therefore little had been known about it at the time.

Mr. Soong stated that recently they had entered into an arrangement with the Italians whereby, as I understood him to say, the payment of something like two millions was to be made to the Italians and the Italians were turning over to the Chinese Government the entire balance of the Italian indemnity—I understood him to say amounting to something like twelve millions.

  1. Copy transmitted to Department by the Minister in China in his despatch of November 20, from Nanking; received December 18.