893.51/6702
Memorandum of Conversation, by the Chief of the Division of Far Eastern Affairs (Hamilton)
The British Ambassador called at his request. He said that he had called on the Secretary on Saturday last in reference to other matters and that the Secretary had indicated that we were giving thought to the question of the possibility of extending credits to China for the purchase of commodities of a type which could not be used for military purposes. The Ambassador said that he had not discussed with the Secretary this question but that in turning the matter over in his mind he wondered whether he should have pursued the matter further with [Page 554] the Secretary. He asked whether I could give him any further information in the matter. He said that the Chinese Ambassador at London had informed the British Foreign Office that at the forthcoming meeting of the League Assembly30 the Chinese would press for definitive action on the subject of the extension of assistance to China. He added that the Chinese Ambassador at London had indicated that some assistance would be forthcoming from the American Government.
I said that as the Ambassador was aware the Chinese Ambassadors at London, Paris and Washington had from time to time approached the governments to which they are accredited with various proposals for the extension of loans or credits to the Chinese Government. I said that the most recent such approach to this Government by the Chinese Ambassador here had taken the form of a suggestion that this Government extend credits to China for the purchase of commodities to be utilized for the relief of the many millions of destitute, homeless Chinese. I said that we have been giving the matter thought. I referred to the fact that some weeks ago the British Government had decided adversely in reference to a proposal that the British Government extend a loan to China. I said that it was my understanding that the Export Credit Guarantee Department of the British Government had been and was continuing to give certain consideration to various proposals involving the extension of credit to China for the purchase of certain types of commodities. I said that here we had a somewhat similar situation and that these proposals if and when they were put forward received attention. The Ambassador inquired whether it would be possible under existing legislation for the American Government to extend a credit to China for the purchase of commodities to be used for relief purposes. I said that I thought such action would be possible if the Government should decide that it was advisable to take the action. The Ambassador then remarked that the American Government had previously, in 1933, extended a credit to the Chinese Government. I assented. The Ambassador asked whether I thought a decision would be reached by us in the near future before the meeting of the League Assembly. I expressed doubt whether early action was to be expected and I said that the whole proposition was still just a general idea which was receiving thought but that the matter had not progressed to a point where we had come to grip with practical details. I said that if a decision should be reached to go ahead with the matter, we would probably wish to get in touch with the British Government. I also said that I would report the Ambassador’s call to the Secretary, having especially in mind my statement that if and as our consideration [Page 555] proceeded to a point where affirmative action on our part appeared likely, we would probably wish to get in touch with the British Government.