893.51/6336: Telegram

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

128. My 118, March 16, 11 a.m. The following letter addressed to me as American Ambassador, dated March 21, has been received from Dr. H. H. Kung:

“With reference to my letter of March 13 transmitting a copy of Mr. Clark’s telegram of March 9 concerning the Hukuang loan, in response to which letter Mr. Peck in your absence kindly telegraphed to Washington, I should appreciate your good offices in now forwarding to Washington a further communication to the representatives of the American creditors, as follows: the British, French and German Groups have accepted the proposed Hukuang loan announcement. Phrasing such as that suggested by Mr. Clark has not been requested in previous settlements. Moreover sentence in opening paragraph of the proposed announcement, stating that the other provisions of the contract remain unchanged, makes it unnecessary to change paragraph 1 as Mr. Clark suggested. As to his other suggestion, the change will [Page 668] be duly constituted as I have already assured him and as stated in the memorandum communicated March 1 will remain in force until the loan is fully redeemed.

In view of the foregoing I do not wish to make further changes, since I consider the statement to be clear and accurate in the premises. In order to avoid further delay and particularly because I wish to complete the arrangements before sailing for Europe April 2, I should like to be advised promptly that the representatives of the American creditors accept the draft for recommendation to bondholders as has been done by the representatives of other than American creditors who are understood to hold a much greater proportion of the bonds than that held by Americans.

Also I should be grateful if you would request that the Chinese Ambassador be advised, for his information.”

Sent to the Department; Peiping, by mail.