693.002/632: Telegram
The Ambassador in China (Johnson) to the Secretary of State
[Received May 4—8:55 a.m.]
236. Supplementing my 233, May 3, 7 p.m., I added that during conversation Kung invited attention to the following: that while he appreciated the good intentions of the British Government in trying to protect British and Chinese interests in the customs, still the agreement would result in assisting Japan at China’s expense and would place China in a very difficult situation. He remarked that this was the first time since the Washington Conference that two foreign countries had entered into an agreement concerning China without China’s participation. He felt that this created a dangerous precedent. He pointed out that one of the interpretations of the agreement might be that it sanctioned Japan’s violation of the interests of foreign powers by military power at their seizure of revenue, in disregard of rights of holders including foreign nationals, of internal bonds, and by altering the status of the customs.
Dr. Kung asked me specifically whether it was true that the American Government would not object to the agreement as stated in the Reuter despatch. I told Dr. Kung that I had no information in regard to the attitude of the American Government concerning this matter, and that I was not informed as to whether the American Government had stated that it would not oppose the agreement. Dr. Kung asked me to convey these views to you and I said that I would. Dr. Kung stated that the arrangement had put him in a very embarrassing position. He does not wish to alienate British sympathy. He has refused to issue any instructions to Maze in regard to matter, apparently in this matter yielding to the request of the British that he not oppose it. Young informed me this morning that local Commissioner of Customs called on Kung and stated that he had received a telegram from Maze indicating his difficulties in the light of present agreement. Kung told Commissioner of Customs that he was not issuing specific instructions; that standing instructions should be sufficient to enable Maze to know what he should do, as he was an officer of the Chinese Government. This of course leaves Maze in a very difficult situation because he will now be pressed by Japanese and British to pay over moneys deposited in his name in Hong Kong and Shanghai Bank under an agreement to which his Government is not a party.