893.50 Recovery/7–2448: Telegram

The Ambassador in China (Stuart) to the Secretary of State

1358. To Dept, ECA and Agriculture. ReEmbtel 1335, July 21, repeated Shanghai 645, on Rural Reconstruction Commission. Moyer and Embassy officer July 23 discussed Foreign Office proposals with Dr. Tung Ling, director American Affairs Department. In this informal discussion we indicated to him what our recommendations to Department would be and endeavored enlist this support to obtain Foreign Minister’s agreement thereto, in effort expedite early conclusión these negotiations without use of suggested separate unpublished agreed minutes as proposed by Foreign Office.

Herewith our comments and recommendations reference being made to numbered points reftel: [Page 624]

In order meet Foreign Office proposal regarding subparagraph (e) paragraph (2), we suggest first sentence read as follows: “To appoint such executive officers and administrative staff as Commission deems necessary to carry out the program, it being understood that the chief executive officer shall be a citizen of China.”
We indicated to Tung in unmistakable language our desire have paragraph (3) retained in exchange of notes. We stressed value including these provisions in published exchange of notes from standpoints informing Chinese people regarding intentions of commission and serving to counter Chinese Communist propaganda regarding lack of positive rural reconstruction program of National Government. We also stressed importance outlining in definite terms the possible scope of Commission’s work since many different views held here with respect meaning of rural reconstruction. To meet Foreign Office objections to subparagraph (b) of paragraph (3), we suggest this subparagraph be merged with subparagraph (c) to read as follows: “Consultation with the Chinese Government concerning ways and means of progressively carrying out land reform measures, including steps to survey, register and appraise agricultural land, in areas where the coordinated extension-type program specified in subparagraph (a) of this paragraph is established.” This wording designed remove Foreign Office objection to inferred enforcement by Commission of Chinese laws and regulations. If our proposal accepted, lettering remaining subparagraphs should be altered accordingly.
We perceive no objection to Foreign Office proposal that words “or its chairman” be inserted immediately after words “if the Commission” in paragraph (4).
Reference Foreign Office suggested deletion paragraph (5), we make counterproposal to insert in penultimate paragraph Foreign Minister’s note to Ambassador immediately after “to direct cooperating agencies of the Government of China” the following words set off by commas “including the local officials concerned”. This wording while not so specific as that originally suggested for paragraph (5) appears to meet our needs and permits Chinese save face on delicate question authority National Government over provincial and other local officials, if you concur dropping paragraph (5), remaining paragraphs should be renumbered accordingly.
We recommend adoption Foreign Office proposal reference paragraph (7) regarding diplomatic privileges and immunities.
We recommend adoption Foreign Office proposals for deletion words “fiscal charges, including” and last sentence paragraph (8).
We recommend adoption Foreign Office proposal delete clause “and also reserves the right to withdraw the US members of the Commission” in paragraph (10) but insist upon retention entire second sentence this paragraph.

Regarding Tung’s suggestion on voting procedure contained penultimate paragraph reftel, we recommend inclusion this sentence as final sentence paragraph (1).

Foreign Office proposals and our recommendations were discussed by Moyer with Dawson prior to July 23 meeting at Foreign Office. [Page 625] We believe Dawson in full agreement our recommendations except those under points (3) and (6) this telegram. Cannot now be reached order determine his attitude these points. Moyer will confer with him at Shanghai evening July 24 or morning July 25.

Moyer now hoping return Washington after week or 10 days by which time we hope negotiations on exchange of notes may be finalized. Accordingly urgently request Department send instructions regarding above.