893.24/1071: Telegram
The Consul at Hanoi (Reed) to the Secretary of State
[Received June 4—6 a.m.]
77. The Chief of the Military Cabinet has just informed me that he had a preliminary conversation with General Sumita this morning in regard to the transit cargo at Haiphong. In general, the following represents the Japanese program as outlined in this preliminary conversation; the Japanese consider all transit cargo ordered by or paid for by the Government of Chiang Kai-shek, regardless of the name in which it stands at Haiphong, to be destined for the Government of Chiang Kai-shek; the Japanese intend to take all such transit cargo; and all other transit cargo will be sold locally for the benefit of the owners or will be permitted to be reexported upon submission of evidence acceptable to the Japanese that the transit cargo in question is privately owned. The Chief of the Military Cabinet was unable to say what the Japanese would accept as sufficient evidence of private ownership. He stated that from his conversation with General Sumita, he gathered that the Japanese estimated the transit cargo at Haiphong that they considered to be for the Government of Chiang Kai-shek to amount to about 20,000 tons, or from one-fourth to one-third of the total transit cargo at Haiphong. He added further that he did not believe the Japanese would make any move against the transit petroleum stocks that are actually stored on the premises of the Standard-Vacuum Oil Company and the Texas Oil Company.
General Sumita is seeing the Governor General this afternoon—the latter is departing tomorrow morning for a visit in the south of about a month. The negotiations concerning the transit cargo will be handled by the Chief of the Military Cabinet in the absence of the Governor General.
Sent to Cavite for repetition to the Department, Chungking, Peiping, Hong Kong, Shanghai. Shanghai please repeat to Tokyo.