893.50 Recovery/6–2648: Telegram
The Secretary of State to the Ambassador in China (Stuart)
930. Dept fully appreciates difficulties incorporate sweeping changes China agreement as indicated Emb 1159 June 26, and agrees Emb should have maximum latitude negotiation subject following observations. Changes Deptel 921 June 24 were forwarded in belief that in general on standard articles substantive revisions European agreements should be applied China, and that purely drafting changes standard articles should be offered China, if possible, so as to avoid unnecessary Chinese resentment. Some changes of form, if not applied China, would have an undesirable substantive connotation for China agreement.
For example, failure delete former Art VI (Assets in US) and include its substance as new Art II para 1(a) (ii) would imply greater emphasis this undertaking for China than for European countries, whereas if anything, reverse is actually the case. Foregoing, plus necessity find a place for previous Art V para 2, new Art II para 2, indicates desirability retain new draft Art II.
Dept will rely Emb judgment whether divergence China from ERP text on points of form and language would create sufficient Chinese resentment to warrant effort effect changes. In general, Dept believes that, within physical limitations Emb 1159, serious attempt should be [Page 580] made incorporate all changes transmitted Deptels 920 and 921. With exception introductory sentence Art II para 1, Chinese should find such changes readily acceptable since most of them are concessions.
Dept will not transmit further changes standard articles unless significant points of substance or face involved. Question of minutes to be appended agreement as Annex will be discussed subsequent telegram.43
Only other unresolved questions here on China agreement are (1) wording new Art V para 5 introductory sentence in light Embtel 1149 June 25 and (2) MFN treatment Japan on which instructions will follow.44
Sent Nanking 930 rptd Shanghai 1151.