The Consul at Geneva ( Everett ) to the Secretary of State

No. 604 Political

Sir: I have the honor to enclose a copy of a memorandum51 prepared by the Industrial Cooperative Council of China which the Chinese Minister to Switzerland, Dr. Victor Hoo, handed to Mr. Vincent52 during and incidental to a conversation yesterday in regard to general conditions in the Far East. Dr. Hoo explained that, whereas the Cooperative Council was not official and the memorandum contained private views, the Chinese Delegation to the League had undertaken to transmit it to the League Secretariat on behalf of the Cooperative Council.

The memorandum describes conditions in areas of China under the control of the Chinese Government and may be briefly summarized as [Page 346] follows: Whereas field crops have been excellent this year, manufactured goods are very scarce; 903 [90%] of China’s factories have been bombed or taken over by the Japanese; machinery and means of transport are required to give employment to industrial refugees; Mr. W. K. H. Campbell (League expert)53 has given advice and drawn up a constitution for the use of the industrial cooperatives; and the Chinese Government is allocating three million dollars for the use of the 800 cooperatives that have already been formed. Pointing out that inasmuch as “drugs and medical supplies are internationally recognized as necessities and as textiles are the most common of all manufactured goods and most necessary to the people,” the Cooperative Council states that it “would like to ask the League of Nations to help in developing this part of the program” and expresses the hope that the next Assembly of the League will give favorable consideration to a request for half a million pounds.

Dr. Hoo expressed doubt that the League would grant the amount of money desired but said it was not unlikely that the League would furnish at its expense experts to advise and assist the Chinese in carrying on the work of the industrial cooperatives. He felt that there also existed some basis for hope that, if the League gave recognition to the industrial cooperatives in the manner anticipated, individual nations might be prompted to extend materials credits to China for reconstruction purposes in connection with the work of the cooperatives. Such credits, he pointed out, would not be open to possible objection or exception on grounds of affording political or military support to China and could be justified on humanitarian as well as commercial grounds.

With regard to action by China at the September session of the League Assembly, Dr. Hoo stated that the Chinese Delegation would of course again present the case of China and request assistance, but that he was not optimistic of favorable results. He said that the Chinese Delegation would probably utilise the action of the United States in serving notice of intention to terminate the 1911 Treaty of Commerce and Navigation with Japan54 as an argument for action along similar lines by States Members of the League and as a basis for requesting financial and economic measures against Japan. Dr. Hoo remarked that far too frequently League members justified inaction with regard to China on grounds that the League was not in position to take action without American leadership or cooperation. In this general connection, he mentioned France particularly as being averse at this time to any positive move in the Far East because it [Page 347] felt that complications in that quarter might weaken the front against Hitler. France therefore made it a point to discourage a positive stand by the League or its ally, England, in the Far East and to encourage adjustment or temporary patching up by England of its difficulties with Japan. (Dr. Hoo cited no facts or circumstances in support of these opinions). It would be possible at the forthcoming session of the Assembly, Dr. Hoo continued, for the Chinese Delegation to cite the recent American action with regard to the 1911 Treaty as an indication that the United States was assuming a position of leadership in the Far East and to insist that it was incumbent upon the League Members to follow that leadership in such a measure and manner as might be practicable.

Dr. Hoo made the foregoing remarks at random and, whereas they would seem to indicate the lines along which the Chinese Delegation is thinking, they are not taken as indicating that China has a fixed plan at this date for approaching the Assembly in September.55 It is, of course, possible that circumstances might arise during the next six weeks which would considerably modify the views expressed and the plan now envisaged by Dr. Hoo.

Respectfully yours,

Curtis T. Everett
  1. Not printed.
  2. John Carter Vincent, Consul at Geneva.
  3. British Technical Adviser to the Chinese Government.
  4. For correspondence concerning the termination of the Treaty of Commerce and Navigation of 1911, see pp. 558 ff.; for text of treaty, see Foreign Relations, 1911, p. 315.
  5. Because of the outbreak of war in Europe, sessions of the League Assembly were postponed.