693.002/472: Telegram
The Consul General at Shanghai (Gauss) to the Secretary of State
[Received January 29—3:43 p.m.]
170. I discussed Shanghai customs question this morning with Japanese Consul General who confirmed the conversation with the customs on lines reported in my No. 113, January 20, 6 p.m. and stated he “hopes” after Shanghai question is settled arrangements will be made release loan and indemnity quotas at Tientsin but adds he has no jurisdiction in that matter. He has no intention of submitting Shanghai arrangements to interested foreign representatives here before making them effective. He believes loan and indemnity quotas for Shanghai should be fixed for a fairly long period—6 months or a year—and not be subject to frequent revision. He asserts he cannot agree to deposit of revenues in any other than Yokohama Specie Bank [Page 638] and considers assurance of payment of foreign loan and indemnity quotas should satisfy foreign interests. I emphasized the American interest in the integrity of the customs and again outlined the assurances desired by the American Government.
2. I am inclined to believe that if pressed the Japanese may ultimately agree to periodic transfer of foreign loan and indemnity quotas to foreign banks after they have first been deposited in the Japanese bank.
Repeated to Tokyo, Hankow, and Peiping.