661.9331/11–1946: Telegram

The Consul General at Shanghai (Davis) to the Secretary of State

2271. Further report received from Bayne on Sinkiang situation, reference my telegram 1175, October 23; repeated to Department as 2066.

Governor Chang this province expected arrive shortly in Nanking for new instructions on dealing with Soviet Consul General at Tihwa. Since he had already offered Soviets joint operation of tin, petroleum and tungsten deposits on basis of blanket instructions received from Chiang Kai-shek when he took post, Governor’s instructions as previously reported to you have been both rejected and preempted by him in that he has already offered concessions to Soviets that do involve political sovereignty. Chang is also protesting as loss of face withdrawal of trade proposal made by Chinese to Soviets last year. Above is substance of Executive Yuan memorandum received from Foreign Office. Present uprising currently reported in press is not considered by Government as being directly connected with economic discussions. Present indications are that limiting instructions as reported will be adhered to by Nanking.

Sent Department as 2271; repeated Nanking as 1281.