893.48/1037
Memorandum by the Chief of the Division of Far Eastern Affairs (Hornbeck) of a Conversation With the Chinese Ambassador (Sze)
The Chinese Ambassador called, and the conversation began with discussion of miscellaneous phases of the current situation in China. There was then brought up the subject of the conversation held on January 364 and the views exchanged at that time. The Ambassador said that since then he had exchanged a number of communications with the Chinese Minister of Finance, H. H. Kung, urging upon Kung adoption of the suggestions which the Ambassador had made with regard to procedure in relation to the Chicago Bank Loan.65 He said that as recently as yesterday he had received a telegram from Kung in which Kung advanced certain views and asked for the Ambassador’s opinion, and that he (the Ambassador) had telegraphed back again urging adoption of his (the Ambassador’s) suggestions. He said that he was convinced that the thing to do was to begin the making of payments and that the Chicago Bank Loan was the obligation with regard to which the beginning should be made. He said that he could not understand the failure of his Government not to see the matter in the light in which he saw it. He said that he would keep on the line which he was pursuing.
I asked the Ambassador whether he had any information with regard to a rumor to the effect that H. H. Kung is likely to retire from the Ministry of Finance and that there are divergencies of view between Kung and T. V. Soong.66 The Ambassador said that he had not had quite that information, but that he had had in a personal letter information to the effect that Kung was becoming very tired of his “job” and would like to go abroad as an Ambassador.
The Ambassador asked me whether I had heard anything about the Hukuang Loan.67 I told him that I had, and I gave him the substance of the information which we have in Peiping’s mail despatch No. 117, December 4, 1935,68 on the Hukuang Loan. I made the comment that [Page 575] the Chinese Government’s reply to the joint memorandum of the British, the French and the American Ambassadors of August last was unsatisfactory and was regarded as another evidence of the disinclination of the Chinese Government to deal effectively with such matters.69 The Ambassador shook his head with a gesture of despair.
I deliberately avoided inquiring expressly whether the Ambassador had been taking any further steps toward obtaining readjustment of the R. F. C.70 and the F. C. A.71 obligations, as regards schedule of payments; but I gained the impression both from what the Ambassador said and from what he omitted saying that he has not recently been active in that connection. I took occasion to throw out the suggestion that if in the future officials of other departments choose to make statements to the Ambassador affirming or implying that the American Government will pursue a particular course of action with regard to those obligations or other obligations, it might be well for the Ambassador to let this Department know of the such assurances or intimations upon which, when conferring with this Department, he relies. The Ambassador indicated that he welcomed the suggestion and regarded it as one which might prove helpful.
The Ambassador then reverted to the efforts which he is making in connection with the Chicago Bank Loan. He said that he was pressing the matter so hard that perhaps some of his own people might suspect that he himself had a personal interest, which, he said emphatically, he had not. He said that he nevertheless would keep right on urging the soundness of his view and his plan. I expressed gratification that he was thus being active in the matter.
- See Memorandum by Mr. Raymond C. Mackay of the Division of Far Eastern Affairs, p. 459.↩
- See Foreign Relations, 1919, vol. i, pp. 505 ff.↩
- Former Chinese Minister of Finance, Executive Member, National Economic Council of China.↩
- Final agreement for a railway loan from a four-power banking group (American, British, French, German), signed at Peking, May 20, 1911; John V. A. Mac-Murray (ed.), Treaties and Agreements With and Concerning China, 1894–1919 (New York, 1921), vol. i, p. 866.↩
- Not printed; for enclosure, see memorandum from the Chinese Ministry for Foreign Affairs to the American Embassy, Foreign Relations, 1935, vol. iii, p. 765.↩
- For joint memorandum see Foreign Relations, 1935, vol. iii, p. 763; for Chinese reply see ibid., p. 765.↩
- Reconstruction Finance Corporation.↩
- Farm Credit Administration.↩