Memorandum by the Minister in China (Johnson)26

This morning by arrangement I called upon Dr. Hsu Mo, Vice Minister for Foreign Affairs,27 and stated that I wanted to inquire what prospect there was of some satisfactory arrangement regarding an investigation and settlement of our claims. I pointed out that we had [Page 756] submitted a long list of claims last year and had supplemented this list by another list in April of this year. I stated that at a conversation which I had had with Dr. Wang Ching-wei,28 Acting Minister for Foreign Affairs, in October of last year the latter had stated that the Ministry of Foreign Affairs was making an investigation of these claims, writing to the several provincial governments and to the several Ministries and collecting all available data for the purpose of examining the claims and arranging them into categories. I stated that we had waited very patiently for some results on this investigation but that thus far we had heard very little. I pointed out once more that we had hoped by an arrangement such as we had proposed to put claims once for all into a category of cases that no longer needed to be constantly worried about in intercourse between the Legation and the Foreign Office. I stated that the continued existence of these claims as unfinished business hung like a cloud over our intercourse; that it was a source of trouble to the Ministry of Foreign Affairs and an embarrassment to us as, in the state of uncertainty now existing, American interests were constantly besetting us with requests for some settlement. I pointed out that this situation tended to becloud China’s credit and make it difficult to obtain progress along any line of business.

Dr. Hsu Mo stated that he understood this and he felt that he understood and was sympathetic with the American point of view. He said that the Foreign Office was still engaged in making a survey of the claims listed by us and they had found that generally the cases represented claims that the Chinese Government had no intention of repudiating. There were other claims, however, for which they could find no evidence and for which they would have to ask us for evidence in the form of contracts, et cetera. There were still other claims arising out of situations responsibility for which the Chinese Government must disclaim. No government could acknowledge responsibility in such matters. Dr. Hsu Mo admitted that perhaps the American Government thought such claims well founded and there therefore existed a dispute which naturally should be the subject of arbitration, but the Chinese Government was unwilling even to admit such matters to arbitration because of the principles involved.

I stated that it seemed to me that the Chinese Government could lose nothing by arbitrating these questions where principles were involved; that presumably any neutral commission would decide such matters in accordance with well recognized principles and that such decisions would tend to confirm the Chinese Government’s position if it was well founded, rather than disturb it. I pointed out that the American Government was not anxious to embarrass the Chinese Government by pressing for payment of claims when it knew that money [Page 757] was difficult to find, but that nevertheless it seemed to us that it would be vastly beneficial to the Chinese Government if this whole question could be relegated to the jurisdiction of some competent machinery that would take it once and for all out of the realm of diplomatic dispute. I again expressed the hope that we would soon know what the Chinese Government’s decision would be in this matter.

Dr. Hsu Mo stated that they were still studying the question and still pursuing their inquiries in regard to the numerous claims mentioned in our list.

Nelson Trusler Johnson
  1. Copy transmitted to the Department by the Minister in China in his unnumbered despatch dated May 24; received June 15.
  2. Mr. Laurence E. Salisbury, Second Secretary of Legation at Peiping, and Mr. George Atcheson, Jr., Second Secretary of Legation at Nanking, were also present.
  3. Also known as Wang Chao-ming.