811.79690 Pan American Airways/48: Telegram

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

45. Your 17, February 27, 5 p.m.

1.
The press in China has carried announcements of the arrangements made for Pan American planes to fly to the Portuguese controlled port of Macao but I have heard of no objection made by the Japanese to this project nor do I know of any negotiations for a “clipper ship base in China”.
2.
On January 13 Bixby, vice president of Pan American Airways, called on me in Peiping and handed me a letter from himself stating that his company had concluded arrangements with the Portuguese colony for operating rights and an air mail contract which entitled the company to transport mail originating in Macao from Macao to the Philippines and the United States and mail from the United States and the Philippines to Macao. Contract does not cover air mail from places in China to the United States or to the Philippines. The letter stated that the Chinese Government had made an arrangement with the French for an air line between Canton and Hanoi (see Nanking telegram 26, October 4, 11 a.m.98) and that the Chinese were unwilling to make similar arrangements with Portugal whereby air mail might be exchanged in Macao between China mail planes and the Pan American planes and complained of the discrimination. The letter asked that I take informal action to obtain Chinese consent to such an arrangement. Bixby informed me orally that the Portuguese at Macao would [Page 640] welcome such an exchange whether or not the mail passed through the Macao post office.
3.
I wrote to Peck99 on January 14 asking him to say to Kung, Minister of Finance, in my name that Pan American had made arrangements to connect San Francisco with Macao and to ask him to use his influence in the Government to bring about calling of Chinese planes at Macao to make possible exchange of mail. Kung told Peck October [January] 15 that he thought it would not be difficult to get authorization for the pacts in view of the fact that the proposal of the American company did not involve landing American planes in China. On January 25 Peck inquired about the matter incidentally at the Ministry of Communications and found it was at a deadlock. On January 26th he talked with Kung again and Kung suggested that the easiest way to achieve the result would be for the Portuguese Government first to inform the Chinese Government that it would have no objection to the arrangement. Peck conveyed this idea to Bixby. Peck suggested to me that he be authorized to see the Minister for Foreign Affairs in order to acquaint him with the status of the company’s application and I said I saw no objection to this. On February 8 Bond of Pan American told Peck that Pan American had instructed its agent at Lisbon to present to the Portuguese Government the plan suggested by Kung and fearing that this might be carried out and find the Foreign Office without information regarding it Peck called on Vice Minister Hsu Mo the same day and described the situation. Hsu Mo said that if the Portuguese Government gave the suggested notification the Chinese Government would consider it. On February 13 I thanked Kung for his helpful cooperation and he showed a desire to have project succeed. No further conversation[s with] Chinese officials have occurred. As the matter stands the Chinese Government is awaiting an approach from the Portuguese Government.
4.
The Department will note that this whole project is one for which Pan American Airways, a private American company, is attempting to gain the approval of the Chinese authorities. Discussions have been in progress between company officials and Chinese officials for several months. The informal and exclusively oral discussions between Embassy officials and Chinese officials have been intended merely to assist the company in its efforts to bring about contact between the Chinese Government’s planes and its own planes at Macao a port not under Chinese jurisdiction through making Macao a landing station for Chinese planes already flying between Shanghai and Canton.
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Full reports of above will be forwarded the Department by mail.1

Johnson
  1. Not printed.
  2. Willys R. Peck, Counselor of Embassy in China at Nanking.
  3. None printed. Department’s telegram No. 19, March 6, 6 p.m., stated: “Department appreciates having this information and has informed Post Office Department.”