751G.94/136: Telegram
The Chargé in France (Matthews) to the Secretary of State
[Received 8 p.m.]
599. I saw Chauvel this morning and conveyed to him with due emphasis on the importance of the question the contents of the Department’s telegram No. 504, September 19, 5 p.m. He frankly admitted what I have suspected for some time that he himself would [Page 139] like to give me more detailed information but that he could not do so without the permission of Baudoin. He, therefore, asked that I give him a memorandum in the sense of paragraph 3 of the Department’s telegram [504?] which he promised to go to [Baudoin with?]. This I have done immediately. He said that he felt we should have the full text of the political agreement and detailed information in so far as it is available in Vichy with respect to the military negotiations now in progress.
As to the factual regime [résumé?] contained in the Department’s numbered paragraph 1, he suggested several clarifications. With reference to (a) on “The privileged position” of Japan in Indochina he explained (as stated in the memorandum quoted in my telegram 591, September 19, 10 p.m.) that the Japanese had requested national treatment—that is, complete equality with French in economic and commercial matters. This the French Government had rejected and are opposed to concluding any general economic agreement specifically granting a favored position to Japan. What they are prepared to do, however, is to ascertain exactly what imports and exports Japan is interested in and to grant de facto preferential treatment with respect thereto or at least the principal items. The French desire, however, to maintain freedom of action to negotiate similar preferential commercial agreements with other countries covering products in which they are interested.
I remarked that in other words what was intended was the establishment for Indochina of a separate tariff bargaining regime based on the same bilateral preferential treatment that had governed French trade policy for some years back and he confirmed the correctness of this.
As to paragraph 5, he stated that the “political agreement” recognizes permanent French interest not only in Indochina (as stated to me by Baudoin) but also in the entire Far East.
As to paragraph c, he stated that the political agreement is subject to the conclusion in reality of only the military accord. When and if the military accord is reached, Japanese troops will immediately enter Indochina.
I remarked that if such a situation actually develops since the “political agreement” apparently contains largely assurances desired by France, there would seem to be no object in making it contingent upon reaching an economic agreement. Chauvel stated that such was the case and that the economic accord would require months of negotiation in any event. In other words, Baudoin’s statement to me did not convey an entirely accurate picture since Japanese troops would [Page 140] enter Indochina immediately upon the conclusion of a military accord rather than wait the negotiation of the economic accord.
The rest of the Department’s factual summary Chauvel stated is correct.