893.5151 Manchuria/12: Telegram
The Ambassador in Japan (Grew) to the Secretary of State
Tokyo, October 21, 1937—5
p.m.
[Received October 21—9:25 a.m.]
[Received October 21—9:25 a.m.]
486. Department’s 333, October 18 [19], 3 p.m., paragraph 4 to Peiping. Manchukuo foreign exchange control.
- 1.
- We understand that following institution of Japanese exchange control in January the Japanese Finance Department has not permitted the export of capital to Manchuria except under rigid safeguards against such capital leaking out of Manchuria to foreign countries. According to press accounts, the primary purpose of the new Manchuria regulation is by enforcing in Manchuria exchange control as drastic as that enforced in Japan to facilitate the flow of capital to Manchuria.
- 2.
- Assuming that the representations which might be made at Tokyo would emphasize the inconsistency between the Manchuria exchange measures and Japanese declarations with regard to the maintenance of the open door in Manchuria, the reply of the Japanese Government would probably be that until Manchukuo is recognized “no dispute whatever can be entertained with regard to that country” (see our telegram No. 87, April 16, 7 p.m., 193548).
- 3.
- It is our opinion that from financial as well as from political considerations there is little likelihood of representations, if made, having any useful result.
- 4.
- Our representations and the Japanese rejoinder would probably be given publicity in Japan if not in the United States and they would inevitably be interpreted in this country in the light of recent announcements of American attitude with regard to the Far Eastern conflict. We are not, of course, in a position to estimate whether the [Page 933] present objectives of American policy require, in the circumstances indicated, that a caveat be entered.
Repeated to Peiping.
Grew