893.51 Salt Funds/153: Telegram

The Acting Secretary of State to the Ambassador in China ( Johnson )

74. Reference Ambassador’s telegram 575, November 25, 5 p.m., from Peiping,12 in regard to Salt Administration. You are authorized to cooperate with your principally interested colleagues in an informal endeavor to persuade the Chinese Government to refrain from such action as would lessen the extent of foreign participation in the administration of the Salt Gabelle. Department is of the opinion that such approach should be not in the interest of the continued efficient functioning of the Salt Gabelle, which per se would seem to be a matter solely of Chinese concern, but rather in the interest of those foreign bondholders whose security for loans made to the Chinese Government might be affected adversely by elimination or curtailment in the effective functioning of foreign employees of the Salt Gabelle.

As the contemplated action of the Chinese Government would if taken apparently affect British, French, Japanese, and German interests equally if not more than American interests, you are authorized to cooperate but not to take the lead in this matter.13

Moore
  1. Not printed.
  2. The Ambassador in China in his despatch No. 318, January 19, 1937, reported informal representations to the Chinese Government by the American Ambassador and the British Ambassador in conversations with Dr. Hsu Mo, Chinese Vice Minister for Foreign Affairs, in December 1936. Dr. Hsu Mo gave assurance that the Chinese Government had no intention whatever of doing anything that would impair the efficiency of the Salt Administration. (893.51 Salt Funds/156)