793.94/6844: Telegram
The Ambassador in Japan (Grew) to the Secretary of State
[Received January 29—8:45 a.m.]
17. Referring to recent reports from China in regard to Japanese activities, I was informed orally by the Foreign Office today that [Page 27] Hirota had absolutely no idea of going to China at the present time; that the Japanese Minister to China has received no new instructions and that so far as my informant was aware all there was to these stories was that the Kwantung Army hoped to reach a definite understanding with the Chinese local authorities as to the western boundary of Jehol; such arrangement would necessarily be local, because anything else would bring up the question of recognition of “Manchukuo”, which no Chinese official could possibly consider at the present time. So far as loans to China are concerned, I was informed that no Japanese loans are in prospect, as the Nanking Government could not consider a loan from Japanese sources, and Japanese bankers would not lend money to China in view of the fact that old debt questions are still outstanding. The Foreign Office seems to be of the opinion that the present is no time to attempt new negotiations with China.
Repeated to Peiping.