893.515/681: Telegram
The Ambassador in the Soviet Union (Bullitt) to the Secretary of State
[Received July 26—4:52 a.m.]
308. Dr. Yen, Chinese Ambassador, who returned to Moscow last night, called on me today and said that he had just received an urgent telegram from T. V. Soong saying that, although the American Government had promised to appoint a financial expert to make the same sort of visit to China that Leith-Ross is about to make, no American had been appointed.59 Yen said that Soong had telegraphed saying that it was urgent that an American should be appointed at once and should reach China at least as soon as Leith-Ross.
I asked Yen what I had to do with this matter about which I knew nothing. He replied that Soong had asked him to appeal to me personally to try to expedite the appointment.
I asked Yen if he knew what Leith-Ross intended to propose. He replied that the British Government had intimated to the Chinese Government that if the Chinese Government would tie Chinese currency to the pound the British Government would see to it that the Chinese Government should receive a 10,000,000-pound credit or loan in Great Britain.
Yen then said that he had a piece of news of the utmost importance which he could communicate to me in strictest confidence. He went [Page 323] on to say that within the past few days the Japanese Government had presented four demands to the Chinese Government: (1st) recognition of “Manchukuo”; (2d) military alliance; (3d) economic alliance (Yen said he thought this meant privileges of customs union with limitations); (4th) cultural collaboration.
I asked Yen if he thought General Chiang Kai-shek could or would accept these demands. Yen replied that he believed acceptance was impossible and added that he had telegraphed General Chiang Kaishek saying that it was better for China to fight even though fighting meant suicide rather than accept more Japanese demands.