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

209. 1. We learn from informed officials that the Ministry of Railways signed May 12 a preliminary agreement with French banking [Page 599] interests for a loan of pounds sterling 4 million for construction of a railway from Kunming (Yunnanful) to Kweiyang. The banks at present included are the Banque Franco-Chinoise and the Banque de L’Indo-Chine; it is stated that other French banks will join in the final agreement.

2. Sent to the Department, to Peiping, Shanghai, Yunnanfu, Tokyo.