893.51/4955
The Minister in China (MacMurray) to the Secretary of State
[Received September 1.]
Sir: I have the honor to refer to my telegram No. 245, of June 13, 1926, 9 a.m., in regard to the seizure of the salt revenues from the Changlu salt production district, near Tientsin, by the Military Governor of Chihli, General Chu Yü-p’u. In this telegram I stated that the British, French and Japanese Ministers, representing the nationalities interested in the Reorganization Loan, had agreed to recommend to their respective governments that, for the protection of the salt administration and the loans secured upon its revenue, if this interference did not cease, the interested nations would assemble at the salt field near Tangku sufficient military and naval forces to prevent further interference with the functioning of the salt administration. I further stated that the British Minister had inquired whether the American Government would be disposed to join in [Page 953] such action. The Department replied on June 15th (telegram No. 120, June 15, 1926, 4 p.m.) to the effect that the American Government could not participate in the suggested joint military action.
I now have the honor to state that the suggested military action did not take place, and I have been informed by the Acting Associate Chief Inspector of the Salt Gabelle, a British subject, that an agreement has been practically concluded between General Chu Yü-p’u, on the one hand, and the Ministry of Finance and Salt Administration, on the other, whereby the former obtains a subsidy of $300,000 per month, local currency, from the Changlu salt revenue. This agreement has not yet been formally ratified by the Ministry of Finance and by General Chu himself, but the Acting Chief Inspector was confident that it would be so ratified. In return for this subsidy, General Chu guarantees not to interfere with the collection of revenue by the salt administration in the Changlu district. The Central Government will thus obtain about $9,000,000 per annum, local currency, instead of $13,000,000, which is the normal total revenue collected in this district.
I have [etc.]