893.51 Salt Funds/173: Telegram
The Ambassador in China (Johnson) to the Secretary of State
[Received 11:40 a.m.]
175. Shanghai’s 371, March 9, 4 p.m. [and] my 154, March 12, 10 a.m. Under date of March 22 British Embassy addressed letter to Kung referring to memorandum of the Associate Director General of the Salt Administration stating that the question of representations to the Japanese Government was under consideration. British Embassy stated that the basis of such representations would be that “apart from the interests of His Majesty’s Government in existing loans secured on salt revenues and in the British staff, the preservation of the Administration is most important for future rehabilitation.” British Embassy concluded by stating that under the circumstances British Embassy was anxious to urge upon Kung the importance of [Page 675] preventing the disruption of the Administration and the necessity of maintaining the authority of the foreign staff. To this letter Kung replied in substance under date of March 24:
“The Chinese Government is anxious that every practicable step be taken to preserve the Salt Administration and to prevent its disruption, and will be grateful for the assistance of your Government to that end. As to the position of the: foreign-officers, I would point out that the present abnormal conditions, and particularly difficulties of communication, have made it impracticable in all cases fully to maintain the principles by whatever joint responsibility of foreign and Chinese officers in matter of administration; but in principle I consider that as to essential functions the joint responsibility of the Directors General and of the subordinate foreign and Chinese officials should be maintained substantially as it existed during the years prior to the outbreak of hostilities. I am issuing instructions to the Salt Administration to the effect that there should be no derogations from this principle except to such extent as is unavoidable during the emergency, and that any such derogations are only temporary in character.”
Repeated to Peiping and Shanghai.