793.003/1030: Telegram
The Secretary of State to the Ambassador in the United Kingdom (Winant)
6230. 1. We received on December 8 the Chinese Government’s reply to our document of November 27. The substance of the Chinese reply is as follows:
[Here follows substance of Chinese memorandum of December 7, printed on page 392.]
2. As regards (b) (1) above, we are inclined to adopt an attitude similar to that of the British Government as expressed in paragraph numbered 2 of Mr. Eden’s letter of December 4 (your 6870, December 4, 8 p.m.) and assume that with the abolition of the treaty port system it is not the intention of the Chinese Government to confine foreign overseas shipping to particular ports. We accordingly propose not to make any further counter-suggestion to the Chinese on this point.
3. As regards the questions of inland navigation and coasting trade, which questions would seem to constitute the only remaining matter of difference between us and the Chinese, we are prepared to accept an appropriately revised wording of the formula suggested by the Chinese which would be consistent with the provisions of the draft [Page 397] full article on this subject previously proposed as an alternative to reserving the matter for the later comprehensive treaty. We accordingly expect to suggest to the Chinese that the second sentence of the quoted portion of paragraph (b) (2) [3] above be revised to read as follows: “It is further understood, however, that, if vessels of any third powers are permitted to participate in the coasting trade or inland navigation, vessels of the United States of America shall be allowed the same privileges.”
4. With reference to Mr. Eden’s comments in his letter of December 7 (your 6931, December 7, 11 p.m.), it is requested that you inform Mr. Eden along lines as follows:
Although we have naturally been desirous, for reasons which Mr. Eden will himself of course appreciate and some of which we have referred to in previous telegrams, to expedite so far as possible the conclusion of the brief treaty on extraterritoriality, we have made no concessions to the Chinese merely for the sake of saving time. On the contrary on several occasions action which we had been desirous of taking and which we were after full consideration prepared to take has been postponed by us because of our desire to cooperate to the fullest extent possible with the British Government and in the earnest hope of reducing to a minimum the very few divergencies between our views and those of the British Government—divergencies which have arisen as a very natural result of necessary differences between our respective practices and procedures.
As previously mentioned, our concept in proposing the brief treaty has been that it would effect abolition of extraterritorial and other special rights and would take care of such related matters as might require attention because of abolition of extraterritoriality. We had, of course, hoped to avoid extraneous matters and matters of particularization which might cause the negotiations to be unnecessarily prolonged (thereby tending to lessen the psychological benefits which might be expected to accrue from the treaty) and which might more appropriately be reserved for the later comprehensive treaty. From the beginning we have had no thought of seeking to reserve or to obtain from China anything that is not usual and normal in modern international relations between friendly countries and we have, it is believed, made this clear both to the Chinese Government and to the British Government. We have proceeded on the assumption that the Chinese Government has had in mind objectives identical with ours and has desired, as strongly as we have desired, to see the relations between the United States and China placed, through the medium of the brief treaty, on a basis of what is normal, usual, equitable and just in international relations.
The concept of the British Government in regard to the question of relinquishment of extraterritorial and related rights has from the outset [Page 398] of our discussions proved to be substantially the same as ours. As mentioned above, and previously in paragraph numbered three of our 5931, November 25, 7 p.m., such divergence of views as has obtained between this Government and the British Government in regard to such questions as the coasting trade and inland navigation arises from differences in the established practices and procedures of the two Governments.
Treatment of commercial subjects by this Government and treatment thereof by the British Government are necessarily affected by considerations and requirements which are not identical. As previously mentioned, we are not in position reciprocally to offer to the Chinese a simple formula suitable for inclusion in the present treaty providing for national treatment in commerce for the reason that in our consideration of such matters we must take into account difficult problems of State and Federal jurisdiction.
In addition, we are not in position reciprocally to offer the Chinese rights of coasting trade or inland navigation. Nevertheless, in an endeavor to meet British wishes, we accepted a formula designed among other things to place coasting trade and inland navigation in the category of pending matters. Accordingly we proposed to the Chinnese that these matters be held in abeyance. We proposed as an alternative a formula suggested by the British Government. As a third suggested procedure we proposed the insertion of a full article on inland navigation and coasting trade along the lines of articles written into our modern treaties with other countries. The question of proposing such an article was raised with the British Government as early as October 31 and received comment in Mr. Eden’s letter to you of November 12 (your 6401, November 13, midnight) to the effect that if the inclusion of an additional article in the treaty became unavoidable the British Government would be agreeable to accepting one along those general lines. As the Chinese have been insistent in dealing with the coasting trade and inland navigation in the present treaty, we did not see how we could do other than keep such action as might be decided upon within the framework of our policy not to seek special rights. Our inability to offer reciprocal rights necessitated the action which we took and which had received full consideration. In this connection we mentioned in paragraph numbered six of our 5931 that we believed that we had come as closely as is possible within the necessary framework of our concepts, policies, and practices to paralleling the British suggestions.
It may be of interest that Dr. Soong has stated categorically to our Ambassador at Chungking that China does not propose to allow foreign flag vessels to participate in coasting and inland waterways trade. If this statement accurately reflects the policy of the Chinese Government [Page 399] (and our impression of the trend of Chinese official and public opinion and feeling of recent times is that it does), we, for our part, consider that we cannot do other than to recognize that China, accorded an equal and sovereign place in the family of nations, will be completely within her rights in reserving inland navigation and coasting trade to the Chinese flag.
Accordingly our decisions with respect to the points raised by Mr. Eden involve, in our view, not the making of “concessions” to the Chinese but the effecting of the relinquishment of our special and unilateral rights with no limitation other than the usual and normal limitation, which is a cardinal tenet of our general commercial policy, that our interests shall not be discriminated against as compared with the interests of third countries.
It had been our hope to have the treaty signed about December 8 or 9; signing must now, of course, await final action in regard to the questions of inland navigation and coasting trade.