740.00119 PW/3–946: Telegram

The Chargé in the United Kingdom (Gallman) to the Secretary of State

2789. After having studied U. S. notes of February 9 to Soviet and Chinese Govts, and after some informal exchange of views regarding Soviet policy in Manchuria, Sterndale Bennett has given us a memorandum setting forth for strictly confidential information of Dept. certain information received from British Embassy in Chungking as well as certain tentative conclusions of Foreign Office regarding possible Soviet aims in Manchuria. Memorandum concluded with statement that British Chargé in Moscow35 has been instructed to inform [Page 1117] Soviet Govt, with reference to reports of removal of Jap equipment from Manchurian factories that HMG reserve all their rights and wish to place on record their view that disposal of Jap assets is matter for discussion and settlement between Allied nations having claims to Jap reparations. Roberts is also instructed to add that in absence of agreement resulting from such discussion HMG regard it as appropriate that the state in whose territory they are located should retain such assets on a custodian basis to be debited against that state’s eventual share of Jap reparations. HMG cannot acquiesce in unilateral removal of assets by third party nor can they recognize any agreement between individual Govts, which purports to arrange for final disposal and ownership of Jap property rights, interests and assets. According to memorandum, as soon as Roberts has made communication to Soviet Govt, British Embassies in Washington and Chungking will hand copy of it to U.S. and Chinese Govts, respectively. Sterndale Bennett says instructions to Roberts in above sense went forward March 8.

British Embassy at Chungking reported on February 22 that Chinese Vice Minister of Foreign Affairs confirmed that Russians had undoubtedly removed much machinery as war booty but added that as Chinese officials were not permitted to investigate no detailed information was available.

On evening February 22, Chinese Minister for Foreign Affairs sent for Counsellor of British Embassy (in absence of Ambassador in Shanghai) and informed him that there were at present two issues affecting Chinese relations with Soviet Govt, in Manchuria. First was withdrawal of troops. Soviet Govt, had undertaken to withdraw by February 1 and although Chinese Govt, had enough troops on the spot to take over the whole territory Chinese Govt, had had no reply to repeated inquiries addressed to Soviet Embassy regarding date of withdrawal. Second issue was disposal of Jap industrial assets in Manchuria. Soviet contended all Jap equipment was war booty while Chinese maintained all enemy property in Chinese territory should pass to Chinese Govt, as advance on Jap reparations. This thesis had been contained in memorandum36 sent by Dr. Wang to Messrs. Byrnes, Molotov and Bevin during meeting in London last September of Foreign Ministers. In this connection, Sterndale Bennett referred to British position that enemy assets located in Allied state should be retained by that state on custodian basis (see Embassy’s 2682, March 736) and said that British Counsellor, Chungking, had received impression from Dr. Wang that U.S. had agreed to Chinese position that all such assets in Manchuria should go to China at once and not be held for final disposition by an Allied Reparations [Page 1118] Commission. Foreign Office would appreciate clarification of U. S. views on this point. Sterndale Bennett apparently felt that point 1 in Dept.’s 1868, February 28,36a which deals with this subject is somewhat ambiguous.

According to British Embassy report, Dr. Wang also said that latest Soviet statement on subject had been communicated to Chinese authorities at Changchun at beginning of February and took line that China would have no grounds for complaint since Soviet Govt. proposed to hand over portion of captured Jap equipment and make arrangements for joint Sino-Soviet operation of the rest, which included majority of more important plants. There was no mention of equipment reported to have been removed to Siberia. Chinese had not replied to this communication but would maintain their stand on principles mentioned above.

As regards possibility of referring Manchurian problem to Security Council, Dr. Wang said policy of his Govt. would depend on nature of Soviet replies to questions put to them which would continue to be strongly pressed.

Foreign Office considers following to be possible aims of Soviets in Manchuria:

Complete restoration of position held by Russia before 1904, despite provisions of Sino-Soviet agreement of last August.
Determination to remain in Manchuria so long as may be necessary to ensure:
The removal of such Japanese equipment as may be required, as war booty; and
Establishment of an administration, whether Chinese, Communist or otherwise, amenable to Soviet Govt.
Desire to make evacuation of Soviet troops from Manchuria conditional upon evacuation of American troops from North China.

Memorandum states Foreign Office would welcome further advice of Dept. as to Russian aims and would be glad to know whether Dept. considers there is any action which can usefully be taken at this stage. Memorandum adds that in event of question being referred to Security Council, HMG would of course be ready to deal with it there in close collaboration with U. S. Govt.

Sterndale Bennett expressed orally his serious concern at situation which was developing and said that in view of press reports that U. S. had presented another note regarding Manchuria to the Russians perhaps some of statements in memorandum would already be out of date. He emphasized that while Foreign Office hoped it would be kept informed of U. S. opinions and actions so that if considered necessary or advisable British could take similar steps, he did not, in any way, wish to suggest a policy of “ganging up” on the Russians.

  1. Frank Kenyon Roberts.
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