693.94244/9: Telegram

The Ambassador in Japan (Grew) to the Secretary of State

104. Department’s 52, May 8, 6 p.m.

1.
As the Minister for Foreign Affairs has been obliged to postpone receiving me owing to constant occupation in the Diet and Privy Council I called this morning on the Vice Minister for Foreign Affairs and made the desired oral and informal approach.
2.
The Vice Minister said that the smuggling operations in China which were being carried on both in the North and in the South were due in considerable measure to the high Chinese tariff on certain commodities. Japanese firms had also protested against these smuggling operations as well as against the high tariff rates. The Nanking Government on its own volition had withdrawn its coast guard ships from waters adjacent to the demilitarized zone. Meanwhile the Japanese Government is carefully studying the situation. The Vice Minister said that he did not feel competent to discuss the situation in greater detail but that he would report my observations to the Minister for Foreign Affairs as soon as possible.

Repeated to Peiping.

Grew