893.61331/45: Telegram

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

274. Department’s 124, May 22, 6 p.m. Following telegram has been received from Nanking:

“May 28, 11 a.m. [noon?]. Your May 26, 4 p.m., penultimate paragraph. I have confirmed from an official of the Executive Yuan that the Yuan has approved and referred to the Central Political Committee a plan for a Government tobacco leaf monopoly. Informant specifically confirmed the following features set down in despatch of May 1 [19?] from Shanghai: the committee composed of the Ministers of Foreign Affairs, Finance and Industries had already reported to the Executive Yuan with the result just mentioned; tobacco raised from American seed in the provinces of Honan, Anhwei and Shantung will be monopolized and tobacco curing plants and warehouses will be established; private manufacturers of cigarettes in China will necessarily buy China grown tobacco as described above from the Government monopoly; tobacco grown from Chinese seed will likewise be monopolized ultimately; import duties on foreign leaf tobacco will be increased so that Government monopoly’s sales may receive no injury from this source. Informant expressed the opinion that considerable time must elapse before the monopoly can be put into operation.

Copy mailed to Shanghai”.

The Embassy is filing written protest with the Ministry of Foreign Affairs against projected monopoly and proposed raising of the import [Page 606] duty on leaf tobacco. British Embassy has already made informal oral representations to the Ministry of Foreign Affairs against the monopoly.