893.659 Matches/12

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

No. 103

Sir: I have the honor to refer to my despatch No. 98, of February 21, 1936, 19 in reference to the proposed match monopoly and to enclose herewith, for the files of the Department, a memorandum of a conversation19 which took place regarding this subject between Mr. Blackburn, of the British Embassy, and Mr. Peck, Counselor of Embassy at Nanking.

It will be noted that Mr. Blackburn stated that the British Embassy has taken very little action in reference to this proposed match monopoly, because the British financial interests involved are slight. It will be noted, also, that in reply to a question asked by Mr. Blackburn, Mr. Peck said that the American Government takes the position that all American economic enterprises in China are by treaty protected from monopolistic interference, although he admitted that Article XV of the American-Chinese Treaty of 184420 deals only with the rights of “citizens of the United States engaged in the purchase or sale of goods of import or export”.

I have thought it advisable to inquire whether the American Consulate General at Shanghai has any information calculated to supplement or revise the finding of the American Commercial Attaché that practically no American capital is invested in the two American companies involved in the discussions for the proposed match monopoly.

I should be glad to receive from the Department any advice which it may be moved to give me, on the basis of information already submitted, in reference to the extent to which the Embassy should continue its opposition to the proposed match monopoly. The British [Page 603] Embassy appears to have no intention of taking active steps in the matter, because the British financial interests involved are slight. The policies of the Chinese Government in reference to the development of manufacturing industries in China will, if present indications are taken into account, have a dual object, the bringing about of conditions which will foster the expansion of such manufacturing industries and the devising of methods whereby the Government may be enabled to derive revenue therefrom. It seems to be taken as a foregone conclusion in the Ministry of Finance that the match monopoly will come into being, despite all obstacles and if any foreign company were to seek to maintain an independent business in manufacturing and selling matches, beyond doubt it would require the most active assistance on the part of a foreign government to enable it to succeed in its endeavor. The Chinese Government feels that in placing the manufacture and sale of matches in China under monopolistic government control it is following respectable precedents abroad, e. g., that of France.

Respectfully yours,

Nelson Trusler Johnson
  1. Not printed.
  2. Signed at Wang Hiya, July 3, 1844; Hunter Miller (ed.), Treaties and Other International Acts of the United States of America, vol. 4, p. 559.